This Is How Much Money You Can Make With $10K in a High-Yield Savings Account

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Make sure you keep your money in a savings account with a great interest rate. Find out how much you can earn with $10,000 in a high-yield savings account. 

It’s never a bad idea to prepare for the unexpected, especially regarding your finances. Having extra cash in the bank is an excellent way to plan ahead for unexpected financial concerns. For many people, $10,000 is a solid amount of money to have in their emergency fund.

If you’re saving for emergencies, you should keep your money in a high-yield savings account to maximize the interest you earn. Curious how much interest you can make with $10,000 in the bank? Below, I’ll explain how much you can earn with this sum in a high-yield savings account.

Earn more interest with a high-yield savings account

Banks that offer savings accounts that earn interest use an annual percentage yield (APY) to describe the returns one can expect if they keep their money in their savings account for a year.

It’s not unusual for brick-and-mortar banks to offer low APYs for their savings accounts. Your local bank could offer as little as 0.01% APY for its savings account. While you will earn something, it won’t be much at that meager rate.

But a high-yield savings account could offer much more. Many online banks offer 4.00% APY or higher for these accounts. How much interest will you earn by stashing $10,000 in a high-yield savings account? Keep reading to find out.

$10,000 in savings generates this much in interest

To calculate how much interest you’ll earn, take your initial deposit ($10,000) and multiply it by the APY. Doing this will show how much money you’d earn if you keep the money in your bank account for one year.

For the following calculations, I went with a 0.01% APY for a standard savings account and a 4.50% APY for a high-yield savings account. The bank accounts on our best high-yield savings accounts list have APYs ranging from 4.15% to 5.05% — I settled somewhere in between.

These calculations assume an initial $10,000 deposit with no additional deposits made to your account:

$450 sounds much better than $1 to me. Beyond opening a bank account with a higher APY, boosting your earnings potential takes no additional work.

Earn even more with compound interest

The calculations above show how much interest you can earn, keeping $10,000 in the bank for one year. But you can earn even more thanks to compound interest, which is interest that you earn on interest. The longer you keep your money in your savings account, the more you make.

To illustrate the power of compound interest, here’s how much money you’ll make if you keep your initial $10,000 deposit in a high-yield savings account for anywhere from one to five years. Again, these calculations assume you make no additional contributions after the initial deposit.

Here’s a breakdown:

That’s $2,461.81 earned in five years, assuming the APY doesn’t change. It’s worth mentioning that APYs can and do change, so your APY likely won’t stay the same rate forever.

Do this to boost your bank account balance

You’re likely missing out on interest if you don’t have a high-yield savings account. If you have a significant amount of money saved up or are working on a big savings goal, you may want to open a high-yield savings account to maximize the interest you earn. Every bit of money earned from interest adds up and can help to improve your personal finances.

These savings accounts are FDIC insured and could earn you 11x your bank

Many people are missing out on guaranteed returns as their money languishes in a big bank savings account earning next to no interest. Our picks of the best online savings accounts can earn you 11x the national average savings account rate. Click here to uncover the best-in-class picks that landed a spot on our shortlist of the best savings accounts for 2023.

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