Mistake #3: Not Doing Your Homework on Rates

As you saw above, savings rates on different accounts range from almost nothing to many times the national average. But many savers don’t spend any time checking what current accounts are paying—and therefore have no idea if the 2% return their bank offers is a great deal or a lousy one.

You don’t have to earn the very tip-top rate on your savings. But it’s worth shopping around to make sure your rate is at least somewhat competitive.

Solution: Always Shop Around

Fortunately, we make it easy to shop rates by checking our daily ranking of the best high-yield savings accounts, which always gives you at least 15 of today’s highest APYs. Currently, the top nationwide offer is 5.55% APY, but our list includes almost 20 choices that earn 5.15% or better.

If you’ve never held savings at a separate institution before, don’t worry. All of the banks and credit unions in our rankings carry the same $250,000 in Federal Deposit Insurance Corp. (FDIC) or National Credit Union Administration (NCUA) insurance. And moving money between banks can be done with an electronic transfer that takes one to three days.

Mistake #4: Not Considering a CD

Continuing to stash cash in your savings account is a great idea. But if you know you won’t need some of your funds for a while, you have another interest-boosting option at your disposal: certificates of deposit (CDs). Unfortunately, many savers overlook this useful bank account option, perhaps thinking it’s too complicated or that it’s not useful for smaller balances.

In actuality, CDs are pretty straightforward. You agree to keep a lump sum in the account for a specified term (usually ranging from 3 months to 5 years). In exchange, the bank or credit union promises you a known interest rate for that full duration. This differs from savings accounts, where the rate can be lowered at any time. Often, you can also earn a higher rate on CDs than savings accounts are paying,

Solution: Move Some Savings to a High-Paying CD

As with savings accounts, our daily rate research makes it very easy to shop for the best CD rates. Today’s top nationwide rate is 5.65% on a 3-month CD, but the top rates across terms range from 4.80% for a 5-year CD to 5.55% on a 6-month CD. Just be sure to choose a duration you can stick to because if you need to cash out before maturity, you’ll be hit with an early withdrawal penalty.

Many CDs in our rankings can be opened with as little as $500 or $1,000, so they aren’t just for the wealthy. And they can keep your savings growing because the threat of a penalty can help you resist the temptation to spend the funds.

Mistake #5: Letting a CD Auto-Renew

When a CD matures, banks and credit unions generally roll your funds into a brand-new CD of a similar duration. This is certainly easy, but it is almost always a losing financial proposition for you. That’s because the new CD you’ll receive is very likely to have a lower rate than you can earn by shopping around—potentially a lot lower. Secondly, you may not want your money locked up for a new term of several months or years.

Solution: Move Maturing CD Funds to Savings

Whenever you open a CD, mark a reminder on your calendar for about a month before it matures. If at that point your CD institution hasn’t told you how to provide instructions on what to do with your maturing funds, contact the bank or credit union yourself.

By acting before the CD’s maturity date, you can request that the funds be transferred to another account at that institution or another institution. You can also ask that the money be sent to you as a check or rolled into another CD. If you’re not sure what you want to do with the funds, you can transfer them into a savings account and decide on a more permanent plan later.

How We Find the Best Savings and CD Rates

Every business day, Investopedia tracks the rate data of more than 200 banks and credit unions that offer CDs and savings accounts to customers nationwide and determines daily rankings of the top-paying accounts. To qualify for our lists, the institution must be federally insured (FDIC for banks, NCUA for credit unions), and the account’s minimum initial deposit must not exceed $25,000.

Banks must be available in at least 40 states. And while some credit unions require you to donate to a specific charity or association to become a member if you don’t meet other eligibility criteria (e.g., you don’t live in a certain area or work in a certain kind of job), we exclude credit unions whose donation requirement is $40 or more. For more about how we choose the best rates, read our full methodology.