BEST SAVINGS ACCOUNT INTEREST RATES IN MASSACHUSETTS: JUNE 2024

Vault’s Viewpoint: Overview of the Best Savings Rates In Massachusetts

Berkshire One Savings

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Why We Chose It

While some local banks in Massachusetts offer rates as low as 0.01% on traditional savings accounts, Berkshire Bank offers an APY of 4.00% on its Berkshire One Savings account. This account has a monthly $5 service charge, but it can be waived if you maintain an average daily balance of $250 or more.

With nearly 100 branches in the Northeastern U.S., Berkshire Bank is a good choice for people who want the option to visit a physical branch and get personalized assistance.

Pros

  • Relatively high rate compared to other local banks
  • Dozens of physical branches
  • Waivable monthly service fee

Cons

  • Relatively high initial deposit requirement
  • $5 monthly fee applies if you don’t maintain a certain balance
  • Some online banks and credit unions offer higher APYs

SCU Direct

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Why We Chose It

The SCU Direct Savings account offers an impressive 5.00% APY on balances up to $9,999.99. Rates decrease as your balance increases, but this account still offers rates significantly higher than the national average, so there’s plenty of opportunity to earn decent interest.

While SCU does have a local presence in Massachusetts, it has fewer physical branches than some competitors. Branches are primarily located in Norfolk and Plymouth counties, so this is something to keep in mind if you live outside those areas.

Pros

  • Low minimum initial deposit
  • No monthly fees
  • Relatively high rate

Cons

  • Few physical branches
  • APYs decrease as balance increases
  • Must be a member with a qualifying checking account to open

DCU Primary Savings

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Why We Chose It

Digital Federal Credit Union, commonly known as DCU, is headquartered in Marlborough, Massachusetts. And if you want to earn an impressive rate on a small savings balance of $1,000 or less, its Primary Savings account could be a smart option.

This account offers an APY of 6.17% on balances up to $1,000. The rate drops to 0.15% APY on the remaining balance. Since that range is so broad, this account is likely best for smaller deposits.

Pros

  • Impressively high APY for small balances
  • No monthly fee
  • Low minimum initial deposit

Cons

  • APY on larger balances is much lower
  • Must be a member to open

Forbright Bank Growth Savings

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Why We Chose It

Forbright Bank doesn’t have a local presence in Massachusetts, though MA residents can open an account online. The Forbright Growth Savings account offers the best high-yield savings rates in Massachusetts at 5.30%.

Besides its high rate, this account also comes with other perks. You aren’t required to make a deposit when opening a new account, and monthly fees are $0, so you won’t need to worry about added costs cutting into your interest earnings.

Pros

  • Very generous APY
  • No monthly fees
  • No initial deposit requirement

Cons

  • No physical branches in Massachusetts
  • Customer reviews are mixed

SoFi

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Why We Chose It

Like Forbright, SoFi doesn’t have a local presence in Massachusetts; it’s exclusively available online. SoFi’s savings account works slightly differently, as it’s a combined checking and savings product. That said, it could be a great choice if you’re comfortable with digital banking and prefer to do all your banking with the same company.

You’ll earn decent APYs on both your savings and checking balances, with rates of 4.60% and 0.50%, respectively. There are also no monthly fees or minimum initial deposit requirements with a SoFi Checking and Savings account.

Pros

  • Generous APY on savings and checking balances
  • No monthly fees
  • No minimum initial deposit requirement

Cons

  • Online only
  • Customer reviews are mixed

How Much Can You Earn With a Savings Account In Massachusetts?

Your interest earnings from the best savings accounts in Massachusetts will depend on your rate and total initial and ongoing deposits. If you start with a larger balance and make consistent, ongoing deposits, you’ll likely earn more interest on your money than you would with a small balance and no subsequent deposits.

For example, if you maintain a $1,000 balance in an account with a 4.00% APY, you’ll earn around $40 in interest your first year. But if you start with a $10,000 balance and make monthly $1,000 deposits, your interest earnings in your first year would be $618.44, assuming a 4.00% rate.

Here’s a look at how much interest you could earn in a year with the best savings accounts in Massachusetts if you maintain a $10,000 balance.

How to Open a Savings Account in Massachusetts

  1. Compare accounts: Avoid opening the first account you find. Instead, compare different options to find the highest rate and lowest fees available. Based on your research, make a list of your top five options.
  2. Identify the best option: Once you have a list of your top five options, narrow it down and choose one that best suits your situation. Ideally, you’ll want to find an account that aligns with your situation and goals and has a decent rate and minimal fees.
  3. Gather documents: Your chosen bank will ask for basic personal information when you open a new account. You’ll likely need to provide your name, address, email, phone number, and Social Security number. But it might also request proof of address and identity, so be prepared to provide a copy of a recent utility bill and a copy of your driver’s license.
  4. Await approval: Whether you apply for an account online, in person, or over the phone, you may need to await approval. Sometimes, you’ll be approved for a new savings account in a matter of minutes, but in other cases, it takes a few days. Ask your bank about its approval process for a better sense of timing.

Tips for Choosing the Best Savings Account for You in Massachusetts

Consider Your Needs

Before you start shopping around for a new savings account, consider your individual needs and goals. Some things you’ll likely want to think about include:

  • Your preferences about banking online vs. in-person
  • The amount you plan to deposit
  • The account features you’re seeking
  • Your short- and longer-term savings goals

Thinking through what you want from a new account can help guide you in your search.

Research Rates and Fees

A high-yield savings account with the highest possible rate can seem like the right choice, but you’ll also want to consider how potential fees might impact your interest earnings. Monthly fees, minimum balance fees and excessive transaction fees may apply with a savings account.

If an account has a high rate but its monthly maintenance fees are also steep, your earning potential could be significantly lower. The best savings accounts in Massachusetts have few fees and decent APYs, even if they’re not necessarily the highest rates available.

Research Minimum Balance Requirements

Besides rates and fees, also research both initial deposit and ongoing minimum balance requirements. Many savings accounts require a small opening deposit of $25 or $50, but larger minimum balance requirements might apply. In some cases, your bank might waive your monthly fees if you maintain a certain average daily balance, so doing so could be worth it.

Alternatives to a Savings Account

Certificate of Deposit (CD) Account

If you can afford to deposit your money for a longer term, a CD account might be a better choice than a savings account. CDs often have slightly higher rates than traditional savings accounts, as the bank requires you to deposit your funds for a few months or a few years. CD rates are also fixed for your chosen term, while savings rates can fluctuate often.

Checking Account

A checking account could be a better fit for those seeking an account for day-to-day spending. These accounts generally don’t have the same transaction limits that you might see with a savings account, so you can withdraw money, pay bills and make debit card purchases often without worry. That said, overdraft fees might apply with a checking account, and most checking accounts don’t earn interest.

Money Market Account

A money market account (MMA) has some characteristics of checking and savings accounts. With an MMA, you might get check-writing capabilities and a debit card. But as you’ll often see with a savings account, transaction limits could apply. Many MMAs offer rates that are comparable to those of high-yield savings accounts.

This type of account could be a great choice if you’re seeking a bit more flexibility than a savings account but also want to earn a high rate on your balance.

Frequently Asked Questions

What Are the Benefits of Going Local and Choosing a Massachusetts Bank for a High-Interest Savings Account?

Choosing a local bank in Massachusetts means you’ll be able to bank in person. This is beneficial if you enjoy the convenience of having physical branches nearby and want the option to easily connect with a human about your account.

Are There Any Massachusetts State Laws That Might Impact High-Interest Savings Accounts?

Massachusetts allows you to deduct up to $100 worth of bank interest from your gross income, or $200 if you’re filing a joint tax return. This provides a slight reduction in your income, which could be more favorable from a tax perspective.

How Do High-Interest Savings Account Rates in Massachusetts Compare to the National Average for Savings Rates?

According to the Federal Deposit Insurance Corporation (FDIC), the national average rate for savings accounts is currently around 0.45%. However, many of the best savings interest rates in Massachusetts are significantly higher than the national average. While you can’t expect 7% savings rates, a 4% or 5% rate might be available.

The post Best Savings Account Interest Rates In Massachusetts: June 2024 first appeared on Newsweek Vault.

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