We independently evaluate all of our recommendations. If you click on links we provide, we may receive compensation.

E*TRADE Savings Account Interest Rates: September 2024

A decent interest rate with more FDIC coverage

By
Ben Luthi
Ben Luthi
Full Bio
Ben Luthi has been writing about credit cards and personal finance for six years and has written for U.S. News, NerdWallet, CreditCards.com and Experian, among others. Ben has developed many of Investopedia's in-depth credit card reviews and enjoys collecting and redeeming credit card miles and points in his everyday life and international travels.
Learn about our editorial policies
Updated September 03, 2024
Fact checked by
Michael Rosenston
Michael Rosenston
Fact checked by Michael Rosenston
Full Bio
Michael Rosenston is a fact-checker and researcher with expertise in business, finance, and insurance.
Learn about our editorial policies
Senior Couple Meeting with Financial Advisor

Don Mason / Getty Images

The E*TRADE Premium Savings Account from Morgan Stanley Private Bank offers a somewhat high yield on your savings account balance of 4.25%. That can be a good option for investors who use the brokerage firm to manage their portfolio. It also offers double the standard FDIC insurance coverage, making it a worthy option to consider for consumers with significant savings.

E*Trade Savings Account Rates
Account Name APY  Monthly Fee
Premium Savings Account from Morgan Stanley Private Bank 4.25% $0

Compare E*Trade Savings Account Rates

E*TRADE presents some interesting incentives for investors or anyone with a large amount of money to put into savings. But its rates aren’t the highest available, so it’s worth exploring your options before making a decision. See some other popular high-yield accounts below.

E*TRADE Savings Accounts: Key Features

E*TRADE Savings Account Key Features
APY 4.25%
Minimum Deposit $0
Withdrawal Limit 6 per month
Monthly Service Fee $0

E*TRADE's Premium Savings account is a high-yield savings account that offers a decent return and no minimum deposit requirement or monthly service fee. Additionally, you don't have to meet a minimum balance requirement to earn interest or get the highest rate available. 

You can open an individual or joint account. Like other financial institutions, E*TRADE limits withdrawals to six per calendar month. It won't charge you a fee for excessive withdrawals, but it may close your account, convert it to a checking account or even remove the account's transfer and draft capacity.

While most bank accounts offer $250,000 in FDIC insurance coverage per depositor, per account ownership category, E*TRADE offers up to $500,000 in coverage using a sweep program that deposits your money with other banks. For joint accounts, the maximum coverage is $1 million.

Pros and Cons of E*TRADE Savings Accounts

Pros

  • Good interest rate

  • Double FDIC coverage

  • Fast access to E*TRADE funds

  • No minimum balance requirements

Cons

  • Strict withdrawal limits

  • 30-day funding timeline

  • Poor customer satisfaction rating

  • Many exclusions to expanded FDIC coverage

Pros

  • Good interest rate: E*TRADE Savings Account interest rates are very high—usually not the highest available from the best high-yield savings accounts, but higher than many. 
  • Double FDIC coverage: Morgan Stanley stores your cash in money market accounts at various banks to help you maintain FDIC coverage on up to $500,000 of your deposits in this account. That may be an important feature for many high-dollar investors. 
  • Fast access to E*TRADE funds: If you use the E*TRADE securities platform to invest, you may be able to transfer cash to and from your investing account instantly, rather than waiting a few days for the funds to be transferred between your E*TRADE brokerage account and an outside bank.
  • No minimum balance requirements: You can open this account and maintain the balance with whatever amount of money you want without worrying about fees or interest rate tiers. You may earn the same APY on the entire balance, although this may not always be the case. 

Cons

  • Strict withdrawal limits: You're limited to just six withdrawals per month—a former federal limit that was removed in 2020 but one that E*TRADE still enforces by closing your account or converting it into a checking account if you exceed this limit.
  • 30-day funding timeline: You need to add funds to your account within the first 30 days after opening it. If you don’t, E*TRADE may close your account before you even get started.
  • Poor customer satisfaction rating: E*TRADE was rated below average in a 2024 independent survey of customer satisfaction by J.D. Power.
  • Many exclusions to expanded FDIC coverage: Morgan Stanley contracts with some of the largest banks in the country to offer expanded FDIC coverage, including Chase Bank, Wells Fargo, and Citizens Bank. If you have large deposits with one these banks and Morgan Stanley keeps some of your funds with that bank as well, your money may not be covered in full.

About E*TRADE: Other Savings Options

The E*TRADE high-yield savings account is available nationwide, and you don't have to be an existing E*TRADE or Morgan Stanley customer to get started. While the higher FDIC coverage can be appealing to high-net-worth individuals and investors, E*TRADE’s savings interest rate is lower than some other banks and credit unions.

E*TRADE doesn't offer any other savings products, including money market accounts or certificates of deposit (CDs). However, it does offer a Max-Rate Checking account, which offers a small yield, plus unlimited domestic ATM fee refunds. Investors can also make use of E*TRADE’s portfolio management program, Core Portfolios.

If you invest with E*TRADE, opening a savings account or checking account with the financial institution can make it easier to transfer money between your investment and bank accounts.

Before you open a bank account, take some time to compare all of your options. When comparing the best savings accounts, consider APYs, monthly fees, minimum balance requirements, and ease of access to funds.

Alternatives to E*TRADE Savings Accounts

The E*TRADE Savings Account is a strong choice if you’re already using E*TRADE’s brokerage services to invest. If not, one of these options might work better for you:

  • High-yield savings account: E*TRADE Savings Account interest rates are good, but the best high-yield savings accounts typically offer even higher rates. Many come with no minimum deposit or monthly fee, as well.
  • Treasury security: T-bills, notes, and bonds may offer a similar level of safety as FDIC-insured funds in a bank account and at times have offered rates that rival those of many savings accounts.
  • Certificates of deposit (CDs): These timed deposit accounts offer some of the highest rates for FDIC-insured deposits as long as you’re able to leave your money in the account for several months or years. Certificates of deposit usually have withdrawal penalties for taking the money out prior to maturity.
  • High-yield checking account: Some checking accounts offer rates nearly as high as savings accounts, but you’ll typically need to meet extra requirements. 
  • Fintech investing banks: Some fintech micro-investment platforms like Acorns offer checking accounts that round up each purchase you make, depositing the difference into specific investments that you set up ahead of time. 

Investments—even “safe” ones like Treasuries—do not guarantee your funds in the same way that FDIC-insured accounts do. It’s possible to lose money if your investment value declines.

Frequently Asked Questions (FAQs)

Does E*TRADE Have a High-Yield Savings Account?

Yes, the E*TRADE Premium Savings account is a high-yield savings account that offers an APY that's much higher than the national average for traditional savings accounts. But it’s not usually the highest—check out the best high-yield savings accounts here to see the highest available rates.

How Often Does E*TRADE Pay Interest on Its Savings Account?

E*TRADE compounds the interest you earn on a daily basis and pays out earned interest monthly.

Do E*TRADE Savings Accounts Have Withdrawal Limits?

You can make up to six withdrawals or transfers from your savings account in any calendar month. If you make excessive withdrawals, your account may be closed or converted to a checking account, or you may lose your ability to make withdrawals.

Are E*TRADE Savings Accounts FDIC-Insured?

Yes, Morgan Stanley Private Bank offers up to $500,000 in FDIC insurance coverage for individual accounts and up to $1 million in coverage for joint accounts. This is more than the typical $250,000, because the Premium Savings Bank Deposits Program allows E*TRADE to sweep funds into deposits at partner banks for extra coverage.

Your Guide to Savings Accounts

Article Sources
Investopedia requires writers to use primary sources to support their work. These include white papers, government data, original reporting, and interviews with industry experts. We also reference original research from other reputable publishers where appropriate. You can learn more about the standards we follow in producing accurate, unbiased content in our editorial policy.

  1. E-Trade. "Premium Savings Account from Morgan Stanley Private Bank."

  2. E-Trade. "Banking Rates and Fees."

  3. FDIC. "Deposit Insurance FAQs."

  4. E*TRADE. "Premium Savings Account from Morgan Stanley Private Bank."

  5. E*TRADE. ”E*TRADE Help Center.”

  6. Board of Governors of the Federal Reserve System. "Federal Reserve Board announces interim final rule …"

  7. J.D. Power. "2024 U.S. Direct Banking Satisfaction Study."

  8. E*TRADE. "Premium Savings Account - Bank Deposit Program."

  9. E-Trade. "Max-Rate Checking."

  10. FiscalData. "Average Interest Rates on U.S. Treasury Securities."

  11. FDIC. "National Rates and Rate Caps."

  12. E-Trade. "Banking Rates and Fees."