8 Best Ways To Earn More Interest for 2024

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The Federal funds interest rate sits at 5.5% right now, up a full percentage point from this time last year. Yet, the average savings account interest rate right now is a meager 0.46%, according to statistics from the FDIC.

You can earn more with a 12-month CD, where the average rate is 1.86%. But that will tie up your money for a year. Depending on your long- and short-term financial goals, savings accounts, CDs, and other types of accounts can all keep your money working harder for you.

If you have substantial funds and you’d like to get the best return, here are eight options.

Read More: 3 Things You Must Do When Your Savings Reach $50,000

What Is the Best Way To Earn Interest on a Large Amount of Money?

You have several options to earn interest rates much higher than the national average. Here are eight choices to invest your money and earn interest of 5% or higher.

High-Yield Online Savings Account

A high-yield savings account delivers interest rates as high as 10 times greater than the national average. To choose the best one for your needs, consider any qualifications you may have to meet, such as direct deposits or minimum balance requirements. You may also want to look at how easy it is to access your funds from the account or to make deposits.

Some savings accounts, like Go2Bank, provide a debit card linked to your savings, making it easy to withdraw funds from in-network ATMs with no fees.

Whatever bank you choose for your high-yield savings, read the fine print carefully to educate yourself on additional fees and limits to the interest rate you can earn. Some banks only offer high interest rates on low balances; the rate decreases the more money you hold in the account.

In rating the Best High-Yield Savings Accounts for 2024, GOBankingRates suggested BMO Alto Online Savings account for no fees and Milli Savings Account for its high APY of , the best you’ll find in an online savings account right now.  

Money Market Account

A money market account is similar to a savings account. Most offer the added option to write checks. Some money markets may offer higher interest rates than traditional savings accounts, but that’s not always the case. It pays to shop around.

GOBankingRates recently spotlighted the best money market accounts for 2024. VIO Bank’s Cornerstone Money Market Savings Account delivers a high APY of , with no monthly fees and a minimum opening deposit of just $100. You can set up automatic transfers to make saving money easier and watch your balance grow.

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Certificates of Deposit

Certificates of Deposit, or CDs, traditionally yield higher returns than savings accounts, with the trade-off of keeping your funds tied up for a set amount of time, ranging from 1 month up to five years or more. A CD allows you to lock in a high rate, regardless of interest rate fluctuations in the market.

Opening a CD can be a smart financial move if you’re saving for a specific event and don’t want to be tempted to touch the money prior to the event. Be aware that most CDs have minimum deposit requirements. In general, the larger the balance and the longer the term, the higher the interest rate will be. However, there are exceptions where financial institutions offer special promotional rates for 12-month CDs, too.

As with money in a savings or money market account, funds in CDs or certificates are insured up to $250,000 by the FDIC at banks and by the NCUA at credit unions.

Right now, you’ll find the highest interest rate for a 12-month CD at Colorado Federal Savings Bank. You can earn , but you’ll need a minimum deposit of $5,000, GOBankingRates reported.

You can ramp up your savings by using a strategy called CD laddering. A CD ladder is a series of CDs, each with a different maturity date. As one CD matures, you use that money to purchase a longer term CD to secure a higher interest rate. Ultimately, all your funds will be locked into high-interest, long-term CDs that mature at different dates, giving you ongoing access to funds as each CD matures.

US Treasury Bonds

If you’re looking for a secure long-term investment, U.S. savings bonds could help you meet your financial goals. Bonds range in price from $25 to $10,000 and they continue earning interest until their maturity date, or – in the case of Series E/EE bonds — even beyond.

The federal government currently offers two types of savings bonds. Series E/EE bonds have a fixed interest rate that guarantees they will double in value by their maturity date of 20 years in the future. The bond continues accruing interest for up to 30 years.

Series I bonds mature after 30 years and have a variable interest rate. You may not earn double what you paid. The yield on an I bond is adjusted every six months to keep pace with inflation, though, making it a relatively safe investment. Today’s I bonds yield 5.27%, which compares favorably to high-yield savings and money market accounts and some promotional CD rates. This rate is good for bonds purchased through Apr. 30, 2024. In the spring, the U.S. treasury will adjust the yield in line with inflation.

Bonds offer many advantages as a long-term savings vehicle. But be aware that you can’t sell an EE bond or an I bond until you’ve owned it for a year. If you cash in the bond before you’ve held it for at least five years, you’ll pay a penalty equal to the last three months of interest earned. You’ll also miss out on the interest payments you’ll receive as the bond reaches maturity.

Interest-earning Checking Account

If you want to maintain easy access to your money while still accruing interest, an interest-earning checking account could be the best solution. Financial services company SoFi offers a high-yield checking account that delivers 0.50% interest, which the online bank says is 7 times the national checking account average interest rate. Plus, there are no monthly maintenance fees and no minimum balance requirements.

When you open a SoFi bank account, you’ll get both a checking and savings account. Money held in your SoFi savings earns a hefty . It’s not the highest in the nation, but a SoFi bank account delivers so many perks, including a referral program and checking rewards, that you’ll find tremendous value. Plus, SoFi is offering a $300 sign-up bonus when you open an account and establish direct deposit.

Landmark Credit Union also has a checking account that pays interest. The credit union’s Premium checking account delivers APY on balances up to $500 every month that you have a direct deposit of at least $250 and are enrolled in eDocuments, or paperless statements.

Rewards Checking Accounts

You can also earn money with a rewards checking account, although the rewards rarely rival the interest rates on high-yield checking or savings accounts. For instance, Landmark Credit Union has a rewards checking account where you can earn 1 point for every $2 in debit purchases where you sign at the point-of-sale. You can cash in points for gift cards, travel, or merchandise.

Keep in mind, some rewards checking accounts also have monthly fees, which can diminish the value of the rewards you earn.

Bank Bonuses

Many checking and savings accounts also offer substantial bonuses when you open an account for the first time. While these bonuses don’t provide an ongoing stream of income that will grow, you can invest the money in a savings account or CD to increase your yield.

Pay attention to the steps you need to take to earn the bonus. Some banks have direct deposit requirements, others have minimum opening deposit requirements, and some ask you to maintain a minimum daily balance.

For instance, Associated Bank, a regional bank with a presence in Wisconsin, Illinois, and Minnesota, has a sign-up bonus worth $600 if you set up direct deposit for $500 or more and maintain a balance of $10,000 or more in the first 90 days. Balances of $5,000 to $9,999 earn $400, and a balance between $1,000 and $4,999 earns $300, GOBankingRates reported.

Chase Bank has a bonus of $300 when you open a Chase Total Checking account and establish a direct deposit of $500 or more within the first 90 days, which expires January 22, 2025.

Keep in mind, bank bonuses, just like interest payments, are considered taxable income by the IRS. If your bank bonus and/or interest on your account totals more than $10, you’ll receive a 1099-INT reporting the payments. That money is counted as income when you calculate your adjusted gross income on your tax returns.

One advantage of CDs and savings bonds is that the interest you earn is deferred until you cash in the CD or bond. You don’t have to pay taxes on that money until the CD or bond matures and you cash it in.

Dividend Stocks

If your investment strategy carries some risk tolerance, dividend earning stocks could be one way to diversify your portfolio while earning passive income. Dividend earning stocks on the S&P 500 currently deliver an average of just 1.5%. Most online savings accounts easily surpass this rate.

But, when you invest your money in a dividend-earning stock, you not only earn extra income through dividends. However, if the stock rises in value, you could realize substantial gains. That’s one aspect making dividend-earning stocks so enticing to investors.

If you do the research and choose the right stocks, you could earn much more than 1.5%. A report from GlobalXETFs.com showed that high dividend stocks delivered an average annual yield of 6.4% between 1960 and 2017. If interest rates fall and the stock market continues rising in 2024, dividend stocks could become a savvy investment.

Right now, stocks like AT&T and Altria Group are delivering yields of 6.61% and 9.72%, respectively. PennantPark Floating Rate Capital leads the pack with a 10.17% yield with monthly dividend payments. These yields put these investments above most high-yield savings accounts in terms of earnings.

It’s important to note, though, that unlike checking, savings and money market accounts, money held in stocks is not protected by the federal government with FDIC or NCUA insurance. Dividend rates may go up or down, as does a stock’s value.

Stock dividends are also tax-deferred; you don’t pay tax on the dividends until you sell your stock shares. Most people roll their dividends into fractional shares of the stock, growing their stake without taking money out of their pocket.

Choosing the Best Place for Your Savings

When you’re deciding where to put your money to earn a high interest rate, consider your goals. Do you want easy access to your funds in the event of an emergency? Then a money market account with check-writing abilities might be your best choice.

If you’re saving for a specific occasion, such as a vacation or a wedding, a CD or savings bond will keep your money safe, and earning interest, until you need it.

A checking account with a high APY makes sense if you have discipline and want to keep your savings and spending money together for simplicity’s sake.

Rates are subject to change; unless otherwise noted, rates are updated periodically. All other information on accounts is accurate as of Feb. 28, 2024.

Editorial Note: This content is not provided by any entity covered in this article. Any opinions, analyses, reviews, ratings or recommendations expressed in this article are those of the author alone and have not been reviewed, approved or otherwise endorsed by any entity named in this article.

The information related to Chase Total Checking was collected by GOBankingRates and has not been reviewed or provided by the issuer of this product. Product details may vary. Please see the issuer’s website for current information. GOBankingRates does not receive commission for this product.

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