Savings calculator: How to grow your emergency fund
(NewsNation) — With the economy on shaky ground, more Americans may focus on saving, but many aren't making the most of their money.
A recent Vanguard survey found that nearly 60% of Americans earn less than 3% interest on their savings, and about a quarter earn under 1% — well below the 4%+ rates offered by top high-yield savings accounts.
Regular vs. high-yield savings account: What's the difference?
A few percentage points may not seem like much, but over time, the higher returns from a HYSA can add up to thousands of extra dollars, without any added risk.
Experts typically recommend setting aside three to six months' worth of essential living expenses in an emergency fund. A high-yield savings account lets that money grow essentially risk-free.Interest Earned:
Total Contributions:
Initial Deposit:
Total Savings:
The calculators on this website are provided for educational purposes only and are not a substitute for, nor should be construed as financial, legal, tax or other advice. All calculator results are estimates based on information you provide and may not reflect actual results based on all relevant information and factors. NewsNation is not responsible for the results or accuracy of information available via the calculators, and users should consult their own financial, tax, legal or other advisers regarding their individual needs.
From Your Money on NewsNation
Traditional savings accounts currently offer an average interest rate of just 0.42%, according to the Federal Deposit Insurance Corporation. In contrast, some HYSAs offer rates about ten times higher, above 4%, per Bankrate.
That extra interest comes with no added risk as long as you're using an FDIC-insured bank, which protects your deposits up to $250,000.
Here's how much more money you could save:
Traditional savings account
Savings: $10,000
Annual interest rate: 0.42%
Balance after 1 year: $10,042
Opening a savings account? Here's what to know
High-yield savings account
Savings: $10,000
Annual interest rate: 4.0%
Balance after 1 year: $10,400
There are a few things to keep in mind before opening a HYSA:
Interest rates can change: While a 4% rate can help grow your savings, it's not guaranteed. Rates may go up or down depending on decisions by the Federal Reserve.
Don't think of it like investing: Emergency funds are meant to be safe and easy to access. If you're looking to grow your money over the long run, there are better options for investing.
Watch out for fees and minimum deposits: Some HYSA accounts require a minimum deposit to earn the advertised interest rate. Others may charge monthly maintenance or withdrawal fees.
No brick-and-mortar locations: Many HYSA accounts are online-only, so if you prefer visiting a physical bank, that might not be an option.
Remember: The Internal Revenue Service treats the interest earned on a savings account as ordinary income, so it's taxed at the same rate as your regular earnings.
Copyright 2025 Nexstar Media, Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.
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