Guide to American Express High-Yield Savings: Choose From 3 No-Fee, No-Minimum Options
Updated April 17, 2024 at 10:14 am
You have many options for where to put your savings and financial institutions know it. They’re constantly changing their rates to lure you and your money into their fold. This is both good news for savers looking to maximize their return, but also daunting for those who don’t want to spend hours researching the best savings account options.
To help you narrow the playing field, we’ve reviewed all the savings account options from a popular bank: American Express, or Amex as it’s also known. While the online-only bank may be best known for its credit cards, it also offers banking services, including three savings options: the American Express® Savings High Yield Savings Account, American Express® Certificate of Deposit (CD) Account and Individual Retirement Accounts (IRAs). We’ll summarize the key features you need to know about each option to determine if it’s right for you and your savings goals.
Our Methodology Newsweek Vault’s Bank team uses various factors to determine which savings account are best for consumers looking to maximize growth potential to meet their financial goals. Evaluation factors include each bank’s fee schedule, savings interest rates, deposit insurance, minimum deposit or balance requirements, ease of opening and accessing your account, promotional offers, and other perks or benefits you may receive when opening or maintaining a high-yield savings account. Although we strive to maintain up-to-date information, savings interest rates and incentives change frequently.
Vault’s Viewpoint
- American Express offers three savings options with competitive rates and no fees or account minimums.
- The highest rate option is the American Express CD, but you can also get a competitive rate on the American Express High Yield Savings Account.
- Conservative retirement savers may like the Amex IRA, which works like the Amex high-yield savings or CD account inside a retirement account wrapper.
American Express Savings Account Options
American Express has come a long way from its start as a freight forwarding company in 1850. Today, it operates as a global payments company that offers numerous products to meet consumers’ financial needs. Among these are three types of savings accounts to grow your savings:
- Amex High Yield Savings Account
- Amex CDs
- Amex IRA
All of these accounts come with no minimums, no monthly fees and 24/7 customer service, making them enticing options for conservative savers. The American Express savings rates are competitive, but not the highest savings rates currently available. That said, these accounts are still worth considering given many competitors have minimum balance requirements or may charge fees.
American Express High Yield Savings
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Who Is This Best For?
The Amex high-yield savings account is a solid option for savers who want an easy place to stash some cash. With no account minimum or fees to worry about and FDIC insurance protecting your money against a bank failure, you can feel comfortable leaving your savings in Amex’s hands.
The account does not include ATM cards, debit cards or check-writing, however, so this is not the place to keep money you’ll need to access regularly. It also isn’t the highest-rate savings account currently available. Other online banks are paying upwards of 5% for their high-yield savings, so it may be worthwhile to shop around before committing. If you’re already an American Express customer, however, using an American Express Savings Account can be a convenient choice.
Pros
- No account minimum
- No monthly fees
- Interest is compounded daily and posted to your account monthly
- 24/7 customer service available by phone
- FDIC insured
Cons
- Does not include ATM or debit cards or checks
- Online transfers to other accounts can take a few days
- Can get a higher APY on other high-yield savings accounts
- No retail branches available
American Express CDs
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Who Is This Best For?
Amex’s CDs offer competitive rates, but you’ll find the best CD rates at other online banks. Amex CDs are best for people who already have other Amex products and want to keep their finances with one institution. They’re also good for people who worry about minimum balance requirements and monthly fees since you won’t find either of those at American Express.
While there are seven terms for Amex CDs, ranging from 11 months to 60 months, for the best rate, you want the 11-month CD, which currently pays 4.75%. The current rates across all CD terms at American Express are:
Pros
- No minimum balance requirement
- No monthly fees
- There is a 10-calendar-day grace period after maturity when you can add or withdraw funds without penalty
- 24/7 customer service available via phone
- FDIC insured
Cons
- Minimum term is 11 months and maximum term is 5 years
- Penalty for early withdrawal or if you close your CD before maturity
- Partial withdrawals are not allowed
- No retail branches available
As with most CDs, there are penalties for early withdrawals, so it’s best to be prepared to lock your money up for the full duration of the CD. The penalty for the 11-month CD is 90 days’ interest on the amount you withdraw early. For the remaining CDs, you’ll pay 270 days’ interest on the amount withdrawn.
| Term | APY |
| 11 months | 4.75% |
| 12 months | 4% |
| 18 months | 3.25% |
| 24 months | 4% |
| 36 months | 3% |
| 48 months | 3% |
| 60 months | 3% |
American Express IRA
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Who Is This Best For?
American Express’ individual retirement accounts are essentially savings accounts in a retirement wrapper. They offer the tax advantages of an IRA—meaning you don’t pay taxes on the money inside the account—with the low-risk features of a savings account. Unfortunately, the low-risk nature means you likely won’t get as high of returns as if you invested your savings in the stock market. This makes IRA CDs best for very conservative retirement savers who are more concerned with preserving their capital than growing their wealth.
Both traditional IRAs, which you fund with pre-tax dollars, and Roth IRAs, which you fund with after-tax dollars, are available and offer the same APYs. The Amex savings rate on the IRA accounts is lower than the rate offered on the non-retirement Amex High Yield Savings. You can earn 4.30% APY with an Amex IRA High Yield Savings Account, or up to 4% with an IRA CD.
Pros
- Roth and traditional IRAs available
- Available as either a high-yield savings account or CD
- No minimum balance requirement
- No monthly fees
- 24/7 customer service available via phone
- FDIC insured
Cons
- Lower returns than you may get if you invested your savings
- The IRS imposes an early withdrawal penalty on retirement accounts
- No retail branches available
- No tax or financial advisors available through the bank
Alternatives to Amex High-Yield Savings
American Express Online Savings vs UFB Secure Savings
UFB Direct is an online-only division of San Diego-based Axos Bank. Being an online-only bank means that UFB, like Amex, doesn’t offer customers branch locations. But if you’re comfortable with online banking, UFB’s high-yield Secure Savings account is worth considering. It pays 5.25% APY, 0.95% above the American Express savings rate.
Like the American Express High Yield Savings account, UFB’s Secure Savings account has no minimum deposit requirement or maintenance fees. Unlike Amex’s savings account, you get an ATM card with the UFB high-yield account.
Both UFB and American Express have highly-rated mobile apps for banking on the go. Amex gets 3.9 out of 5 stars on Google Play and 4.9 out of 5 in the Apple Store compared to 4.7 stars and 4.8 stars for UFB in Google Play and Apple, respectively. UFB also offers SMS banking, which lets you manage your account via text message when you have no wifi.
Both banks are FDIC-insured, but UFB adds a security guarantee wherein it covers any funds that are lost, misplaced or taken out of your account without your permission due to a UFB error, cybercrime or debit card theft.
You can open either account online in a matter of minutes.
American Express CDs vs BMO Alto Online CDs
BMO Alto is yet another online-only bank that offers competitive savings and CD options. Like Amex, BMO Alto’s CDs only extend up to five years. BMO Alto offers six-, 12-, 24-, 36-, 48- and 60-month CDs whereas Amex offers 11-, 12-, 18-, 24-, 36-, 48- and 60-month CDs. All of BMO Alto’s CDs offer higher rates than comparable Amex CDs, so if getting the biggest bang for your buck is your top concern, BMO may be a better choice.
BMO Alto’s CD rates peak at 5.15% on the bank’s six-month CD. Amex’s CDs only go as high as 4.75% and are not available for terms shorter than 11 months. The rate on BMO Alto’s 12-month CD is 5.05%, 1.05% higher than Amex’s 12-month CD and 0.3% higher than Amex’s 11-month CD.
There is no minimum balance requirement or account fees at either bank and interest is deposited monthly at both institutions. Being online only means you’ll need to rely on the bank’s web and mobile portals for your banking. The BMO Alto Digital Banking app is well-rated at 4.6 out of 5 stars on Google and Apple.
Amex IRA vs SoFi IRA
Both Amex and SoFi offer online IRA accounts, but with SoFi you get far more options. Amex’s IRAs come in only two flavors: traditional and Roth. For most savers, this is all you need. But if you are self-employed or looking to rollover an employer-sponsored plan into an IRA, you may want to use SoFi’s SEP or Rollover IRAs.
You also have more flexibility within the IRA accounts at SoFi, where you can invest your money in stocks, exchange-traded funds (ETFs), alternative investments, and more. You can choose your own investments or opt for the bank’s Automated Investing robo advisor, which will build and rebalance a portfolio for you at no charge. By comparison, you only get two options in an Amex IRA: high-yield savings with a 4.30% APY or a CD with a 4% APY. The upside to this is both of these options provide more reliable returns than the stock market, where things can go up and down moment by moment. The downside is over the long term, you’re more likely to get a higher overall return if you invest in stocks.
You should also be aware that investments are not FDIC-insured or bank-guaranteed. SoFi’s Automated Investing platform does have Securities Investor Protection Corporation (SIPC) insurance, though, which provides up to $500,000 protection per customer against bank failure. This includes $250,000 of cash protection.
There are no account minimums or maintenance fees with either Amex’s or SoFi’s IRAs, but you may pay a management fee or expense ratio for the investments you choose at SoFi, such as with ETFs.
Since you may be investing with SoFi, the online bank provides complementary one-on-one phone consultations with a financial planner. To participate, you’ll need to download the SoFi app. Like Amex’s app, SoFi’s app is well-rated on both Google, where it gets 4 out of 5 stars, and Apple, where it gets 4.8 out of 5 stars.
Frequently Asked Questions
Does American Express Have a Good High-Yield Savings Account?
American Express offers decent high-yield savings accounts, but they aren’t the highest-yielding options on the market. The benefit of an Amex high-yield savings account is that there are no fees or account minimums. You also don’t need to do anything to earn the high yield rate, unlike some other banks that require you to maintain a certain balance.
Who Has the Highest High-Yield Savings?
Some of the highest high-yield savings accounts currently available include BrioDirect High-Yield Savings Account, which pays up to 5.35%, and My Banking Direct High Yield Savings Account, which offers a whopping 5.55%. UFB High Yield Savings account is another good option, paying up to 5.25%
Is There Risk with High-Yield Savings?
Nothing is risk-free, but a high-yield savings account comes pretty close as long as you open it at an FDIC-insured institution. The FDIC insures accounts at these institutions for up to $250,000 per depositor, per account ownership category. This means all of your retirement accounts are insured for up to $250,000 against a bank failure and all of your non-retirement accounts are also insured for up to $250,000. But while you’re unlikely to lose money in a high-yield savings account, you also may not make much money. The biggest risk with these accounts is that your savings don’t earn enough to give you the growth you need for your financial goals.
Editorial Note: Opinions expressed here are author’s alone, not those of any bank, credit card issuer, hotel, airline or other entity. This content has not been reviewed, approved or otherwise endorsed by any of the entities included within the post. We may earn a commission from partner links on Newsweek, but commissions do not affect our editors’ opinions or evaluations.
