It’s National Savings Day! Here’s how to possibly earn hundreds more by switching savings accounts

Online banks have been raising interest rates for savings accounts for more than a year, following the lead of the Federal Reserve to combat surging inflation with rising rates. But if your money is only earning the national average – or less – elsewhere, then you’re likely not maximizing your savings. And that’s counter to the spirit of National Savings Day during a time when top savings yields are outpacing inflation.

Fortunately, you can possibly earn hundreds of dollars more per year just by switching savings accounts. Here’s how to get started today.

1. Find your current savings yield

Having money in a savings account doesn’t automatically mean the Fed’s rate increases are helping you. But after five Fed rate increases so far this year, the difference between 0.01 percent annual percentage yield (APY) – or even the national average of 0.58 percent – and what you could get from a high-yield savings account is growing.

You can easily earn 4.25 percent APY (or more) on a savings account at an online bank. That will yield you much more than seven times the national average in a year, without doing any more work.

How much could you earn? The median transaction account balance of $5,300 (according to the Fed) would give you around $225 of interest in a year, assuming the 4.25 percent APY stayed the same for a year and you didn’t add or withdraw money. That same balance would earn just 53 cents at 0.01 percent APY and $30.74 at the national average of 0.58 percent APY over the same period.

So, go ahead and check your bank’s statement to see what APY you’re currently getting.

You can use Bankrate’s Simple Savings Calculator to see how much more you could earn in a competitive high-yield savings account compared to savings accounts at some of the big banks.

2. Research the highest rates available

Bankrate tracks the highest-yielding savings accounts for you. Compare rates to find the best account for you.

In addition to the rate, also consider the following criteria:

• Minimum opening deposit requirement
• Methods to transfer, deposit or withdraw money, such as an ATM card or mobile check deposit
• Whether the account has a monthly service fee

Remember that savings rates are usually variable, so picking a competitive yield is more than just going with the highest rate today since it could easily change tomorrow.

3. Open a new savings account

You can open an account at an online bank quickly and conveniently. Many online banks advertise that the process takes minutes. Generally, you’ll see your interest payments on your monthly statement. This is where you can watch your balance grow, thanks to compound interest – your interest earning interest over time.

Another option for finding higher interest rates on savings accounts is to look at credit unions. Many of the best credit unions offer attractive yields on savings accounts and share certificates.

Other ways to boost your payout

Savings accounts aren’t the only way to earn some extra money to try and keep up with inflation in this increasing rate environment.

Here are some other ways to earn more money or potentially a higher yield.

• Bank account bonus: Some banks offer bonuses for opening a new account. Generally, you’re more likely to see these offered for opening a new checking account at an institution that you don’t currently bank at. But because customers have the same checking account for an average of 17 years (according to a Bankrate survey published in January), it might be worth reevaluating your checking relationship.
• CDs: A one-year CD at a competitive online bank generally earns a higher APY than the bank’s savings account. This could be a good way to earn a higher fixed APY, but you would also need to be OK with keeping your money tied up for the entire term of the CD.

Bottom line

To take advantage of the Fed’s recent 11 rate increases requires enrolling in a high-yielding savings account earning more than 4 percent. In a Bankrate survey published earlier this year, only 16 percent of people weren’t earning any interest on their short-term savings. You don’t have to earn the highest APY. But in this current rate environment, a yield of at least 4.25 percent APY should be your goal.