How Risky Are High-Interest Savings Accounts?

High-interest savings accounts are offered by many different financial institutions today. These types of accounts are very enticing, but many people wonder if they are actually safe. Here are a few things to consider about how risky high-interest savings accounts really are.


If you are dealing with an actual savings account from a bank, then there is not much risk associated with your account. As long as you have an account with a traditional bank, your money is going to be FDIC-insured. This means that if the bank were to go bankrupt, the federal government would step in and repay you for the money that you had deposited up to $100,000 per account.

Money Market Accounts

Some accounts that are billed as high-interest savings accounts are actually money market accounts provided by financial brokerages. These accounts are relatively safe, but they are a little bit riskier than a traditional savings account. These accounts are able to pay a little bit more in interest. However, they are not FDIC-insured, which makes them susceptible to default risk if the brokerage goes under. The likelihood of this happening is low, but there is always the possibility.

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