57% of Americans keep their savings in the wrong place. Here's what $20K can earn in 1 year in a traditional savings account versus a high-yield one

In other words, the vast majority of savers across the country are leaving a lot of money on the table. That’s because the difference between what you can earn in interest from a regular savings account and a HYSA is staggering. That gap isn’t just a technical detail either. It’s money your savings could be earning in the background, with no extra effort required.

Here’s how much $20,000 could earn in a regular savings account versus a high-yield one, and how you can easily make the switch to start earning more.

The real cost of keeping cash in the wrong account

As of March 16, 2026, the average savings account offers a paltry 0.39% yield, according to the FDIC, which means $20,000 would earn as little as $78 a year.

Given that the annual inflation rate as of February is 2.4%, according to the Bureau of Labor Statistics (BLS), you’re actually losing purchasing power over the course of a year by leaving cash in a typical savings account.

By comparison, some of the best HYSAs can offer annual interest rates of 4% or more, according to Experian, with an average rate around 1.64% (2). On a $20,000 deposit, that could mean earning $800 or more annually, while also outpacing inflation.

There are structural reasons for this massive gap between conventional savings accounts and high-yield savings accounts. The lowest rates are often offered by large, well-established banks that have plenty of customer deposits, limited competition and higher overhead costs to operate physical branches and ATMs (2).

Emerging fintech startups, or so-called “neo-banks,” are on the opposite end of the spectrum. Technology and online portals allow these firms to keep overhead costs lower, while the pressure to compete with major banks pushes them to offer better yields (2).

Over time, that difference can add up to thousands of dollars simply based on where your money sits.

The good news: switching from a low-yield account to a high-yield account is relatively easy.

How to make the switch

If you’ve got some excess cash or an emergency fund sitting in a traditional savings account, switching to a higher-yield option can take just a few minutes.

Start by comparing high-yield savings accounts across banks and online platforms. While the advertised rate is important, also check for minimum balance requirements, monthly fees and whether the account is FDIC-insured to protect your deposits.

For example, a Wealthfront Cash Account currently offers a base variable APY of 3.30%, and new clients can get a 0.75% boost during their first three months on up to $150,000 for a total APY of 4.05%. That’s more than 10 times the national deposit savings rate, according to the FDIC’s February report.