Mar 31, 2026

What is a high-yield savings account?

Whether you’re stashing away money for a rainy day or your next joyful splurge, a savings account can be a smart option for reaching your goals. But not all savings accounts are the same.

If you keep your family’s emergency fund or long-term savings at a brick-and-mortar bank, your money is likely sitting idle. Traditional savings accounts often pay a fraction of a percent in interest. That means your cash is actively losing its purchasing power to inflation. You need a smarter solution.

A high-yield savings account (HYSA) can offer a much higher annual percentage yield (APY) than a standard savings account – often significantly higher than the national average. At CIT Bank, we offer several HYSAs with different rates and features such as Platinum Savings and Savings Connect . You can find a summary of all available savings accounts here.

Let’s dive into exactly what HYSAs are, how they work and how you can use one to help achieve your financial goals.

What are HYSAs? The basics explained.

A high-yield savings account is exactly what it sounds like: a savings account that pays you a significantly higher interest rate than a traditional bank.

When you deposit money into a bank, the bank uses those funds to offer loans to other customers. In exchange for keeping your money with them, the bank pays you interest. Traditional banks have massive overhead costs – physical branches, thousands of employees, expensive real estate. To help offset those costs, they keep more of the “spread” – the difference between interest rates charged to borrowers and paid to depositors.

Online banks like CIT Bank operate differently. Because they do not have the massive overhead costs of physical branches, digital banks can pass those savings directly to customers in the form of a higher Annual Percentage Yield (APY). Customers of online banks can access their money via the bank’s website or mobile app, easily making transfers to a connected checking account.

Benefits of high-yield savings accounts

Why should you make the switch? Here are four key reasons why savvy savers choose to park their cash in a high-yield savings account.

Higher APYs. HYSAs offer higher interest rates than standard savings accounts, meaning your money grows faster.
Compound interest. You’re not just earning interest on your deposits, you’re also earning interest on the interest you’ve previously earned, creating exponential growth over time. At CIT Bank, we calculate compound interest daily and add it to your balance monthly.
FDIC insurance. When choosing your HYSA, look for a bank that’s a member of the Federal Deposit Insurance Corporation (FDIC). The FDIC is a U.S. government agency that protects depositors’ money in the event of a bank failure, up to $250,000 per depositor for each account ownership category. Visit the FDIC website for more information.
Liquidity. Liquidity is a financial term that describes how easy it is for you to access your funds. HYSAs are liquid assets because you can easily withdraw your money without penalty whenever you need it. This makes them ideal for emergency funds, short-term goals and any savings that you want protected from stock market volatility.

How do online high-yield savings accounts work?

High-yield savings accounts work the same way as standard savings accounts, but the digital experience makes them easier to set up and manage. Here is how the process works:

Open your account online

Most banks allow you to open HYSAs via the bank’s website or mobile app. With CIT Bank, you can open a new account in about five minutes. You will need to provide proof of your identity and personal details such as your address, phone number, email address and Social Security number (SSN) or Individual Tax Identification Number (ITIN).

Make the minimum deposit

Balance requirements vary, so pay close attention to the details when opening your account. CIT Bank requires a minimum deposit of $100 to open a Platinum Savings or Savings Connect HYSA. You can fund your account using electronic transfer, wire transfer or by mailing a check.

Add to your account

The more money you have in your HYSA, the more interest you’ll earn. Maximize your benefits by transferring money from no- or low-interest accounts into your HYSA. You can easily transfer money from other banks or deposit paper checks using the CIT Bank mobile app. To make saving money even easier, CIT Bank offers three savings boosters as part of the SmartSaver suite of tools available in Platinum Savings and Savings Connect accounts: Savings Boost (a smart algorithm calculates how much you can afford to save and automatically moves money from your checking account into savings), recurring transfers (you choose the amount and set the schedule), and direct deposit (a portion of each paycheck goes right into your HYSA).

Earn interest on your balance

Once your money is deposited, you start earning a competitive variable interest rate. CIT Bank calculates compound interest on a daily basis, and you’ll see the money added to your account balance at the end of each month. Use our savings account calculator to estimate how much your money will earn.

Withdraw money as needed

When you need to access your savings, you have options. You can transfer funds electronically to a linked account at the same bank or another financial institution. CIT Bank customers can also request wire transfers or paper checks sent by mail.

Keep track of your account

Keep track of your account through online or mailed monthly statements. CIT Bank customers can set their delivery preferences and view statements online through the Document Center in the Communications menu.

How to choose a high-yield savings account

Not all savings accounts are the same, and not all banks offer HYSAs. When you’re considering opening a high-yield savings accounts, it pays to compare your options. Here are some things to look for:

Competitive rates. When comparing rates, look at the Annual Percentage Yield (APY), which is the total interest you can expect to earn in one year, including compound interest.
FDIC insurance. Not all digital banks are FDIC-insured. Look for the Member FDIC logo or check the FDIC website to confirm that your deposits are insured. Deposits with CIT Bank are FDIC-insured through our parent organization, First Citizens Bank and Trust Company.
Low minimum deposit requirements. Check the fine print to see how much is required to open your account (minimum opening deposit) and whether the bank requires a minimum balance to maintain the account. CIT Bank requires a minimum opening deposit of $100 for Platinum Savings and Savings Connect accounts.
No maintenance fees. Some banks charge you simply for holding your money. Avoid banks that charge account opening fees or monthly fees.
Daily compounding interest. Ensure your interest compounds daily, not monthly or annually, to maximize your returns.
Robust digital tools. At minimum, your digital bank should provide online and mobile banking tools you can use to securely access your account 24 hours a day, 7 days a week. Look for additional features such as mobile check deposit, security alerts and savings tools such as SmartSaver.
A reputable institution. Choose a bank that is known in the industry for competitive rates and excellent customer service.

Open your HYSA with CIT Bank

CIT Bank offers two powerful high-yield savings account options:

Platinum Savings . This account has a tiered rate structure that pays our most competitive interest rates on higher balances. If you have a substantial emergency fund or a large down payment saved up, Platinum Savings ensures that money is working incredibly hard for you.

Savings Connect . Savings Connect offers a competitive rate on any balance, no matter how large or small. It’s a great choice if you’re just getting started on your saving journey and want every penny to count toward your future financial goals.

Ready to maximize your earning potential? Get started with your new CIT Bank HYSA today.