Putting money in a savings account allows you to have funds available for emergencies or to save for short-term purchases. You can also earn interest when you invest your money in a savings account, though.
Let's say you have a pretty good balance -- around $10,000 -- in your savings account. Here's how much you might earn with this much cash in savings.
Here's what your returns on a $10,000 balance could look like
If you have $10,000 in savings, the amount of interest you can earn on that balance is going to depend on the annual percentage yield (APY) your savings account pays. The FDIC reports that the national average interest rate on savings accounts is 0.46% as of mid-December 2023. However, if you have a high-yield savings account, you could earn up to 5.30% APY.
The table below shows the amount of interest you could earn over time both if you had an account at a bank paying the national average rate and if you found a competitive high-yield savings account paying 5.30%, assuming interest is compounded annually.
| 0.46% APY | 5.30% APY |
|---|
| After 1 Year | $46.00 | $530.00 |
|---|
| After 5 Years | $232.13 | $2,946.19 |
|---|
| After 10 Years | $469.64 | $6,760.37 |
|---|
Data source: Author's calculations.
As you can see, you can earn a pretty substantial amount of interest -- especially over a long time period -- but you'll need to find the right bank account in order to make that happen. You should also know that savings account APYs aren't fixed -- they change over time. If rates go down in 2024, as many people expect they will in the new year, you may not get that 5.30% APY. But the rates on a high-yield savings account are always going to be higher than the national average rate.
Take the time to find the right savings account to maximize your interest
When you put your money into a savings account, your potential returns are always going to be more limited than if you invested in a brokerage account and put your money into the stock market. That's because you are not taking on any risk of loss, up to FDIC insurance limits, as long as your account is FDIC insured.
That doesn't mean the account you pick doesn't matter, though. A high-yield savings account should provide the same safe place to put your money as a savings account paying a much lower APY does, as long as you make sure that your account has FDIC coverage. And, like a savings account paying a much lower rate, your money should still be accessible, so you can withdraw it whenever you want.
The big difference, though, is that the high-yield account is going to give you the chance to earn a lot more interest. You can earn more in a single year than you would after a decade if you find an account paying 5.30% instead of 0.46%. Of course, you will want to consider factors like customer service, fees, and the process of transferring funds -- but plenty of great accounts offering impressive yields also excel in other aspects of the customer experience.
The more money you have in savings, the more it matters that you find the right account -- but even if you have much less than $10,000 set aside, it's worth taking the time to try to maximize your returns. That's especially true as you have a lot to gain and nothing to lose if you just take the time to look for an account offering the most competitive rates.
These savings accounts are FDIC insured and could earn you 11x your bank
Many people are missing out on guaranteed returns as their money languishes in a big bank savings account earning next to no interest. Our picks of the best online savings accounts could earn you 11x the national average savings account rate. Click here to uncover the best-in-class accounts that landed a spot on our short list of the best savings accounts for 2024.
FAQs
How much interest can you earn on $10,000? In a savings account earning 0.01%, your balance after a year would be $10,001. Put that $10,000 in a high-yield savings account that earns 5% APY for the same amount of time, and you'll earn about $500.
How much interest can you earn off 10k? ›
How much interest can you earn on $10,000? In a savings account earning 0.01%, your balance after a year would be $10,001. Put that $10,000 in a high-yield savings account that earns 5% APY for the same amount of time, and you'll earn about $500.
How much does a $10,000 CD make in a year? ›
Earnings on a $10,000 CD Over Different Terms
| Term Length | Average APY | Interest earned on $10,000 at maturity |
|---|
| 1 year | 1.81% | $181 |
| 2 years | 1.54% | $310.37 |
| 3 years | 1.41% | $428.99 |
| 4 years | 1.32% | $538.55 |
1 more row6 days ago
There's nothing wrong with keeping $10,000 in a savings account. But it might not earn you the highest yields.
How much will $10,000 make in a money market account? ›
Currently, money market funds pay between 4.47% and 4.87% in interest. With that, you can earn between $447 to $487 in interest on $10,000 each year. Certificates of deposit (CDs). CDs are offered by financial institutions for set periods of time.
How much interest will I earn on $10,000 dollars? ›
Here's what your returns on a $10,000 balance could look like
| 0.46% APY | 5.30% APY |
|---|
| After 1 Year | $46.00 | $530.00 |
| After 5 Years | $232.13 | $2,946.19 |
| After 10 Years | $469.64 | $6,760.37 |
Dec 30, 2023
Monthly Interest for ₹10000 in Fixed Deposit
| Deposit Amount | Interest Rate (p.a.) | Monthly Interest Payout |
|---|
| ₹10000 | 8.00% | ₹ 67 |
| ₹10000 | 8.50% | ₹ 71 |
| ₹10000 | 9.00% | ₹ 75 |
| ₹10000 | 9.50% | ₹ 79 |
11 more rowsA one-year CD with a $10,000 opening deposit that earns the Bankrate partner average yield of 4.94 percent would be worth around $10,494 when it matures in 12 months' time. This high-yielding one-year CD would earn you around $320 more in total interest than a CD earning the national average rate.
How much does a $50,000 CD make in a year? ›
The best 1-year CDs could earn $2,625 in interest on $50,000. The best 2- to 5-year CDs could earn between $2,250 and $2,375 in interest on $50,000 per year.
What happens if you put $10,000 in a CD for 5 years? ›
The interest is significant and predictable
Let's say you put $10,000 into a 5-year CD with the rate discussed above – 4.75%. After the 5-year term is up you'll have earned $2,611 in interest for a total account balance of $12,611. That is a good rate of return for an option that comes with essentially zero risk.
Most Americans have $5,000 or less in savings
| Savings account balance | Percentage of respondents |
|---|
| $500 to $1,000 | 8% |
| $1,001 to $5,000 | 22% |
| $5,001 to $10,000 | 8% |
| $10,000 to $20,000 | 7% |
3 more rowsOct 18, 2023
How much money you can make by investing $10,000
| Year | Return | Ending balance |
|---|
| 1 | $800 | $10,800 |
| 5 | $4,693 | $14,693 |
| 10 | $11,589 | $21,589 |
| 20 | $36,610 | $46,610 |
1 more rowOct 1, 2023
FDIC and NCUA insurance limits
This insurance protects your money if the financial institution you bank with goes out of business or otherwise can't afford to let you withdraw your money. So, regardless of any other factors, you generally shouldn't keep more than $250,000 in any insured deposit account.
How much does a 1 year CD pay? ›
Not all CDs will charge a penalty; certain CDs, like no-penalty CDs, will not penalize you for an early withdrawal. Right now, the national average rate for a one-year CD is 1.81%. However, there are many one-year CDs that offer APYs above 4% and 5%.
How much does a $100,000 CD make in a year? ›
How much you earn on a $100,000 CD varies, depending on the APY. For example, if your CD has a 5% APY, you'd earn $5,000 after one year.
What happens if I put $10,000 in a high yield savings account? ›
The rate environment is favorable
On a $10,000 deposit, that would equate to $500 after one year. That's a substantial amount of interest, and it dwarfs the minimal 0.46% that most savers are currently getting with their regular savings accounts.
How much money can I make if I invest $10,000? ›
Here's how much you could earn with $10,000 in an IRA
| Time | 6% Annual Return | 8% Annual Return |
|---|
| 10 years | $17,908 | $21,589 |
| 20 years | $32,071 | $46,610 |
| 30 years | $57,435 | $100,627 |
7 days ago
Whether starting your own business, investing in stocks, or buying into an established business, you must ensure that you have a plan and conduct research. If you're prepared to do these things, then turning 10K into 100K quickly is entirely possible for you.
What would 5% interest be on $10000? ›
For example, let's say you invest $10,000 in a simple-interest account that earns 5%. You'll earn an estimated $500 in interest and your account will be worth $10,500 after a year.
Where can I get 7% interest on my money? ›
As of May 2024, no banks are offering 7% interest rates on savings accounts. Two credit unions have high-interest checking accounts: Landmark Credit Union Premium Checking with 7.50% APY and OnPath Credit Union High Yield Checking with 7.00% APY.
