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Discover Savings Account Interest Rate 2024 - Earn 4.25% APY

KEY TAKEAWAYS
  • This Discover savings account offers high-yield savings in the form of a 4.25% APY.
  • You don’t need a minimum deposit or to keep a specific balance to qualify for the interest earnings on this account.
  • Any interest you earn isn’t mitigated by fees because this account doesn’t charge maintenance fees or many other types of fees.
  • You can make up to six withdrawals per month from your account.

A savings account is an easy way to put money away for a rainy day while ensuring you have access to your funds when such emergencies come calling. A high-interest savings account lets you earn a bit on your savings while you’re not using them.?

The Discover Online Savings Account from Discover Bank offers an easy way to access high-yield savings.

Keep reading this Discover savings account review to find out:

  • How much you can earn with this savings account
  • What it takes to open a Discover savings account
  • Whether any other options might be better for you
  • How you withdraw money from a Discover online savings account

Our top picks for savings accounts

Discover savings account interest rate

The Discover Online Savings Account is a high-yield savings account. That means you earn interest on it well above the average rate for many other bank savings accounts.

The Discover Bank savings rate is an APY of 4.25% regardless of your balance. That’s an important consideration when shopping for high-yield savings accounts because many only provide high-level savings benefits when you keep a certain balance — sometimes, it’s $5,000 or more.

There is no minimum deposit requirement to open a savings account with Discover. You also don’t pay any type of monthly fee for this service, but you are limited to six total withdrawals from your account each statement cycle. That’s more than one a week, though, so it should be plenty if you plan accordingly in accessing and using your savings.

Discover Online Savings Account Interest Rate & Other Key Features

Feature Amount
APY 4.25%
Minimum deposit $0
Minimum balance $0
Monthly service fee $0
Withdrawal limit Six per statement cycle

How much can I earn with a Discover savings account?

You earn 4.25% APY on money in this savings account.?

The interest is compounded daily, with the total earned credited into your account on a monthly basis. Daily compounding allows you to earn a little bit more than you would at the same interest rate compounded monthly.

The exact amount you earn depends on:

To understand how interest may add up on your savings, consider some of the hypothetical situations below.

You make an initial deposit and leave it for five years.

Initial deposit Total amount after five years Interest amount earned
$2,500 $3,093 $593
$3,500 $4,331 $831
$5,000 $6,187 $1,187
$7,000 $8,662 $1,662

You make an initial deposit and leave it for 10 years.

Initial deposit Total amount after 10 years Interest amount earned
$2,500 $3,838 $1,328
$3,500 $5,359 $1,859
$5,000 $7,655 $2,655
$7,000 $10,718 $3,718

As you can see, your interest earnings can add up to thousands of dollars over time — and all you have to do is set and forget your savings.?

If you want to earn even more over time, you can add to your savings with future deposits. Each deposit you add begins to accrue interest in the same way, increasing the overall yield going forward.

To calculate how much you could earn, try using our savings calculator.

How the Discover savings interest rate compares

When compared with other bank account options, the Discover savings fares well.?

First, the APY it offers is more than five times the national average, so you’ll earn more money with this account than you would with regular or basic free savings accounts at large banks.

The lack of balance requirements creates an easy entry for this savings account, which isn’t always the case with high-yield products. Many national banks — and even some smaller banks and credit unions — have deposit requirements on their high-yield products that make it harder to earn a better interest rate.

Finally, the Discover savings account doesn’t include account fees for monthly maintenance, official bank checks, stop payment orders and other common transactions. You’ll find that some other high-yield savings accounts do charge a fee — or may charge a monthly fee if your account drops below a minimum balance threshold.

Discover Online savings vs. Capital One 360 Performance savings

These account options are very similar. Neither has a minimum balance requirement or account fees, and you’ll earn the same APY with each account. Interest on the Capital One 360 Performance savings account compounds monthly rather than daily, and if you plan to hold a fairly high balance, that can make more than a negligible difference in long-term interest earnings.

The bigger deciding factor, however, may be where you live. The Discover savings product is a true online savings account, which means there are no branch options for in-person customer service. However, you do get access to 24/7 customer service via phone or chat.

In contrast, Capital One savings account customers who live near a branch or Capital One Café may be able to access in-person customer service as needed. If that’s important to you — and your geographic location makes it possible — the Capital One 360 Performance savings account may be a better choice.

Discover Online savings vs. American Express High Yield savings

The APY you earn is 4.30% both with the Discover Online savings account and the American Express High Yield savings.

When it comes to fees, minimum balance requirements and customer support, these savings accounts run neck and neck. Ultimately, the biggest difference between the Discover Online and American Express High Yield savings accounts is that you may be able to deposit larger checks more often into the Amex account.

Amex allows account holders to deposit up to $50,000 every seven days. Those deposits can be spread out over six total checks, and you can even deposit checks up to $25,000 each. With the Discover Online account, the mobile deposit limitations — particularly for new accounts — tend to be much more average in nature. You may be limited to hundreds of dollars or a few thousand dollars in mobile deposits a week. Otherwise, you may need to reach out to customer service for an overnight drop box where you can send checks to be deposited.

The average person probably isn’t worried about the need to drop $25,000 checks in their savings account quickly. However, if you want full flexibility in this regard, the Amex account may be the right choice.

Is a Discover savings account a good idea?

The Discover Online savings account is a solid choice for most people who want to leverage savings for a bit more interest earnings.?

While you can certainly find high-yield savings accounts that offer slightly higher APY, those usually come with rate tiers or minimum deposit requirements — meaning you have to keep a certain amount in the account to accumulate maximum benefits.

On top of being accessible for anyone and not requiring a minimum balance for the 4.25% APY, the Discover Online account doesn’t come with any maintenance fees or other expenses that might eat into your interest earnings.

However, this is solely an online bank, which means there’s no option for visiting a brick-and-mortar branch. If you’re not comfortable operating primarily via a mobile banking app and the occasional phone call, you might want to look at high-yield savings products from your local bank or credit union.

You can consider these pros and cons when deciding whether or not to open a Discover Online savings account.

Pros of the Discover Online Savings Account
  • APY well above the national average
  • No required minimum deposit or balance
  • No maintenance or transaction fees
  • 24/7 customer service
Cons of the Discover Online Savings Account
  • No brick-and-mortar branch locations
  • Limited to six withdrawals per statement cycle (month)
  • Potentially limited flexibility in making mobile deposits

How to open a Discover savings account

You can open a Discover Online savings account online in a few quick steps.?

First, you complete an account application. You’ll need to enter your name, address and other contact information and your Social Security number. You may also need to enter some basic financial data or estimates, but the application itself should only take a few minutes.

You can make your initial deposit right away or come back to this step later. You’ll need bank account information or a debit or credit card to fund your savings account initially. Once you’re done, your account will be confirmed via email.

How to withdraw money from a Discover savings account

You can’t simply run to the ATM to get a cash withdrawal from your Discover savings account, as it doesn’t come with a debit card.?

However, you can make up to six withdrawals a month via the following methods:

Other savings options at Discover Bank

Discover Online Bank is a fairly comprehensive bank that offers other ways to manage and save your money. You might also consider types of saving account options, such as a money market account or CD from Discover Bank.

Our top picks for savings accounts

FAQ: Discover Bank savings rate

What is the Discover savings account interest rate?

The savings account interest rate from Discover Bank is 4.25% APY. It’s compounded daily, with the total amount earned added monthly to your account.

Is Discover a high-yield savings account?

Yes, the Discover savings account is considered a high-yield savings product. The APY is well above the national average — as much as five times that figure. The rates also compete well with other savings accounts of this type that also don’t require minimum deposit or balance amounts.

How can I withdraw money from a Discover savings account?

You can withdraw funds by making a transfer to another Discover Bank account or an external bank account. You can also do a domestic or international wire transfer or use an Official Bank Check from Discover Bank.

How many Discover savings accounts can I have?

You can have as many Discover savings accounts as you want, as the bank doesn’t put a limit on this. However, you should limit yourself to how many accounts you can manage well.

How do I close my Discover savings account?

To close your Discover savings account, you will need to call the 24/7 customer service line. The number for that is 800-347-7000. Let the representative know you want to close your account, and they will walk you through the process.

Sarah Stasik
Sarah Stasik Personal Finance

Sarah Stasik is well versed in personal finance thanks to her previous role as a Revenue Cycle Manager for a Fortune 500 healthcare company. Using her inside knowledge and expertise, Sarah often covers topics ranging from insurance and the economics of private healthcare to personal finance and small business management.

Over the past 12 years, Sarah has contributed to numerous publications in the personal and small business finance sector, including content on budgeting, bankruptcy, small business accounting, and financial tech. Her writing focuses on making complex or seemingly daunting financial topics more accessible and providing helpful, relevant resources for readers.

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