Bank of America CEO Says Idle Cash Can Earn 4% or More, While Most Savings Accounts Lag Far Behind

The average U.S. savings account still pays less than 1%, and narrowing that difference often comes down to a single choice.

During a call with analysts, Bank of America CEO Brian Moynihan was asked whether AI tools acting on behalf of customers could soon pull idle cash out of banks and into higher-yielding options. He said many customers have already shifted their investment cash.

A customer “can get a money market fund rate of 4%+,” he said, adding that those customers have “already optimized their cash that they put with us for investment purposes.”

What typically remains in checking is money meant for bills. Moynihan said checking balances continue to grow because that cash is “in motion.” Bank of America CFO Alastair Borthwick said on the same call that 59% of consumer balances were still in checking accounts in the third quarter.

National data show many savers still have not made that move. FDIC figures put the average U.S. savings account rate at 0.38% in October 2026. On a balance of $20,000, that works out to about $76 a year.

What the spread means for a typical cash reserve

As of Oct. 21, the 100 largest money market funds were yielding an average of 3.71%, according to Crane Data. At that level, the same $20,000 could generate about $742 over a year if the yield stayed unchanged.

That figure is slightly below the rate Moynihan mentioned, and money fund yields change daily. Even so, it is still close to 10 times the return of the average savings account.

In this example, the difference is a little more than $660 a year, and it does not require stock market risk. It only requires parking the money in an account or fund that pays a competitive rate.

Keep bill money accessible

Moynihan’s point about growing checking balances applies to personal finances as well. Money used for the mortgage, utilities, and credit card autopay has to be available when payments clear. Moving too much of it in search of yield can backfire if an overdraft fee wipes out much of the gain.

A practical approach is to keep about one month of ordinary bills, plus a modest cushion for surprises, in checking. Anything above that, including an emergency fund you hope never to tap, can potentially earn more elsewhere.

Where extra cash may earn more

High-yield savings accounts, often offered by online banks, are the simplest place to start. They are FDIC-insured up to legal limits, transfers back to checking usually take one or two business days, and top advertised rates reached up to 4.70% on Oct. 22. These rates are variable and can decline without notice.

One option is SoFi, which offers a combined checking and savings account with no account fees. With eligible direct deposit or at least $5,000 in qualifying deposits every 31 days, savings can earn 3.30% APY and checking can earn 0.50% APY.

New members may qualify for a limited-time boost that raises the savings rate to as much as 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, depending on deposit size. APYs are variable and may change at any time. Terms apply.

The money market funds Moynihan referenced are purchased through brokerage accounts, and their yields follow 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 could lose some or all of their money.

Certificates of deposit lock in a rate for a set term, which can help when rates fall, but withdrawing early usually means giving up some interest. For savers who can leave money untouched for at least a year, I bonds are another choice, with a new rate due soon and a $10,000 annual purchase limit per person.

Review your rate regularly

Federal Reserve officials are scheduled to meet, and their decision can affect savings and money fund yields within weeks. Promotional rates end on schedule, and variable rates can change at any time, so an account that looked attractive earlier in the year may not be competitive now.

Set a reminder to review the rate on your statement twice a year, and move your money if it has fallen well below the market. Keep in mind that the earnings are taxable. Bank interest appears on Form 1099-INT, while money market fund payouts are dividends reported on Form 1099-DIV.