On an Oct. 14 call with analysts, Bank of America CEO Brian Moynihan was asked whether AI tools acting for customers might soon drain idle deposits out of banks in search of higher yields. He said many customers had already moved their investment cash.
A customer “can get a money market fund rate of 4%+,” he said, and those customers have “already optimized their cash that they put with us for investment purposes.”
What stays behind is bill money. Checking balances keep growing, Moynihan said, because that cash is “in motion.” At the bank, 59% of consumer balances remained in checking accounts in the third quarter, CFO Alastair Borthwick told the same call.
The national numbers suggest plenty of savers have not made that move. The average U.S. savings account paid 0.38% in October 2026, according to FDIC figures. On $20,000, that is about $76 a year.
What the gap costs on a typical cushion
The 100 largest money market funds yielded an average of 3.71% as of Oct. 21, according to Crane Data. At that rate, the same $20,000 could earn roughly $742 over a year, assuming yields held steady.
That is a little below the figure Moynihan cited, and fund yields move daily. It is still nearly 10 times what the average savings account pays.
The difference, a bit more than $660 a year in this example, comes without any stock market exposure. It requires only that the money sit somewhere that pays a competitive rate.
Leave the bill money where it is
Moynihan’s explanation for growing checking balances applies at home, too. Money that covers the mortgage, utilities and the credit card autopay needs to be there when the payment clears. Pull too much out chasing yield, and a single overdraft fee can erase much of what the move earns.
A workable rule is to keep a month of regular bills, plus a small buffer for surprises, in checking. Everything beyond that, including an emergency fund you hope never to touch, can earn more.
Where the rest can earn more
High-yield savings accounts, most often at online banks, are the simplest step. They are FDIC-insured up to the legal limits, transfers back to checking typically take a business day or two, and top accounts advertised rates up to 4.70% on Oct. 22. Rates are variable and can drop without notice.
One option is SoFi, which offers a combined checking and savings account with no account fees. With eligible direct deposit or $5,000 or more in qualifying deposits every 31 days, savings can earn 3.30% APY, and checking earns 0.50% APY.
New members may qualify for a limited-time boost that lifts the savings rate up to 4.40% APY for up to six months. New members who set up qualifying direct deposit may also be eligible for a cash bonus of up to $400, based on the amount deposited. APYs are variable and can change at any time. Terms apply.
Earn up to 4.40% Annual Percentage Yield (APY) on one SoFi Savings account with a 1.10% APY Boost (added to the 3.30% APY as of 10/20/26) for up to 6 months. Open your first SoFi Checking and Savings account between 10/20/26 and 12/31/27, then within 60 days of account opening receive an eligible direct deposit OR $5,000 or more in qualifying deposits. You must maintain eligible direct deposit or $5,000 in qualifying deposits every 31 days to keep the Boost, for up to 6 months. Rates variable, subject to change.
Terms apply at sofi.com/banking. SoFi Bank, N.A. Member FDIC.
The money market funds Moynihan described are bought through brokerage accounts, and their yields track short-term interest rates. They are not bank deposits. The SEC warns that a money market fund “is not guaranteed by the FDIC like bank accounts are” and that investors may lose some or all of what they put in.
Certificates of deposit lock in a rate for a set term, which helps if rates fall, but cashing out early usually costs some interest. For savers who can leave money alone for at least a year, I bonds are another option, with a new rate due Nov. 1 and a $10,000 annual purchase limit per person.
Check your rate after Oct. 28
Federal Reserve officials meet Oct. 27-28, and their decision can ripple into savings and money fund yields within weeks. Promotional rates end on schedule, and variable rates can change at any time, so an account that paid well in the spring may not in the fall.
Set a calendar reminder to check the rate printed on your statement twice a year, and move the money if it has slipped well behind the market. Those earnings are taxable. Bank interest shows up on a Form 1099-INT, but money market fund payouts are dividends and are reported on a Form 1099-DIV.
Add a Comment