The offers on this page are from advertisers who pay us. That may influence which products we write about, but it does not affect what we write about them. Here's an explanation of how we make money and our Advertiser Disclosure.

Can you negotiate a higher savings account rate with your bank?

Negotiating a higher interest rate is rarely successful, but there are still ways to get a better return.

Yahoo Personal Finance· Getty Images
4 min read

A savings account with a high interest rate can help you make the most of your short-term savings goals. However, if your bank's annual percentage yield (APY) is low, you may be wondering what options you have to earn more.

For example, can you negotiate savings interest rates? Or do you need to switch to a different financial institution altogether to get a better return? Here's what you need to know.

Savings account interest rates are variable, which means they typically fluctuate over time. But in most cases, you can't qualify for a better APY on your account through negotiation alone.

That said, banks may offer opportunities for customers across the board to earn a higher interest rate by increasing your balances with the bank or switching to another account that offers a better return.

If your bank doesn't offer such opportunities, your best bet may be to switch to a financial institution that offers a high-yield savings account with a stronger APY.

Read more: 10 best high-yield savings accounts available today

While you're unlikely to be able to negotiate a better savings APY than what your bank offers all its customers, there may be ways to earn a better return by making adjustments to your relationship with your financial institution:

  • Add more money to your savings account: Some banks offer savings accounts with tiered interest rates, reserving their best APYs for customers with higher balances or those who make regular deposits into their savings accounts.

  • Move other accounts to your bank: Some financial institutions may offer special relationship savings rates to encourage customers to keep all their finances under one proverbial roof. In this scenario, your savings rate will typically be based on your total balances in eligible accounts, including bank accounts and investment accounts.

  • Switch to a different account: Banks often offer a variety of savings options, including traditional or high-yield savings accounts, money market accounts, and certificates of deposit (CDs). Depending on your bank, you may be able to get a better APY by switching to a money market account or CD. That said, these types of accounts can come with more limitations, so carefully review the account terms before making a switch.

  • Just ask: Although it's doubtful that your bank will hand you a better rate just because, it won't hurt to ask. You may consider this option if you have a long history with a small community bank or local credit union that places more emphasis on individual relationships. However, success with this approach is rare.

As you consider your options, it's important to remember that nothing is guaranteed. In many cases, you may need to look elsewhere for better savings options.

Whether or not you have opportunities to earn a higher return with your current bank, it's important to consider all the different ways you can make the most of your short-term savings goals:

  • Shop around: Even if you're satisfied with your bank's savings interest rate, you may be able to earn more with a different bank. Start by researching the best high-yield savings accounts to get an idea of what's possible. Then, compare APYs, account minimums, and other requirements and limitations to determine which account is best for you.

  • Focus on online banks: Online banks tend to offer higher APYs than traditional banks and even many credit unions. This is primarily because online banks don't have the same overhead costs as financial institutions with physical branches. Smaller online banks may also offer higher rates to raise funds for other operations.

  • Consider alternatives: As previously mentioned, it can also help to consider alternative savings options, such as money market accounts and CDs. That said, money market accounts can have minimum balance requirements and monthly fees, while CDs may charge you a penalty if you withdraw funds before the account matures. Carefully consider the advantages and disadvantages of these accounts to determine if one is right for you.

  • Consider investing: Depending on your savings goals, it could make sense to invest some of your savings instead of keeping it in a savings account. In particular, this could be helpful for long-term savings needs or funds that don't have a specific goal. However, think twice about investing money for short-term needs, such as financial emergencies or a home down payment.

The savings account interest rate your bank advertises can change over time with market conditions, but if you're hoping to get special treatment and earn more than other customers, you may be disappointed.

However, some banks may offer ways to earn more interest on your savings balance through increasing your balance, improving your relationship with the financial institution, or switching to an account with a better return.

If these options aren't available or the bank's interest rates are low across the board, consider shopping around and comparing other savings options to make the most of your money.