HYSA Rate History 2020-2026: Why MYGAs Lock the Rate
Quick take: HYSA rates whipsawed in the past 6 years: 1.80% in 2019, 0.50% by mid-2021, back to 5.00% in 2023, and 3.00-4.00% for the top accounts on September 24, 2026 after the 2024-2025 Fed cuts. The Fed did not cut in 2026; it raised its target to 3.75-4.00% on September 16, 2026. The Fed drove every move. The pattern: past easing cycles since 2007 cut HYSA yields by 200-400 bps within 12-24 months. For 3+ year money, MYGAs lock the rate contractually.
Rates expire like milk.
The best MYGA, CD and savings rates change every few weeks. Get a short email when a rate on this page changes.
We’ll email you when a rate on this page changes. Hans Goldstein · NPN 20602398.
Rather talk it through? Or book 15 minutes on Hans’s calendar.
Savings account vs MYGA, after tax
What $100,000 earns in 5 years: savings account vs MYGA, after tax
Rates used: Savings account 4.00%, the top online savings rate we tracked (bank sites, September 24, 2026); savings rates can change any day; change it to the rate you are offered. MYGA 5.95%, the best A-rated rate we track as of October 13, 2026: Delaware Life Pinnacle Plus 5-year (AM Best A-, negative outlook, 7/31/2026), $100,000 and up, effective October 6, 2026 (Delaware Life rate sheet).
| Savings account, interest taxed every year | $116,604 |
|---|---|
| MYGA, tax-deferred, before tax | $133,507 |
| MYGA after paying tax on all the interest at withdrawal | $126,136 |
| Tax deferral alone adds about | $674 |
| MYGA ahead of the savings account, after tax | $9,531 |
Assumes 22% federal and 0% state income tax, no withdrawals, rates held for the whole term. MYGA interest is taxed as ordinary income when you withdraw it, not as capital gains. Gains taken before age 59 1/2 can owe a 10% IRS penalty, and cashing out early can cost a surrender charge. In an IRA both grow tax-deferred, so the edge there is the rate alone. Bank and credit union deposits are FDIC or NCUA insured up to the limits; a MYGA is backed by the issuing insurer's claims-paying ability and your state's guaranty association up to its limits, not the FDIC. General education, not tax, legal or financial advice.
Year-by-year HYSA rates (representative cross-section)
Mid-year snapshots of three benchmark HYSAs: Marcus (Goldman Sachs Bank), Ally Online Savings, Synchrony High Yield. Indicative and approximate; actual rates moved within each year. Fed funds column shows the top of the target range. The 2026 row is from the banks’ sites on September 24, 2026.
| Year | Fed funds | Marcus | Ally | Synchrony |
|---|---|---|---|---|
| 2020 (mid) | 0.25% | 1.05% | 1.10% | 1.10% |
| 2020 (end) | 0.25% | 0.50% | 0.60% | 0.60% |
| 2021 (mid) | 0.25% | 0.50% | 0.50% | 0.50% |
| 2021 (end) | 0.25% | 0.50% | 0.50% | 0.50% |
| 2022 (mid) | 1.75% | 1.20% | 1.25% | 1.50% |
| 2022 (end) | 4.50% | 3.30% | 3.30% | 3.75% |
| 2023 (mid) | 5.25% | 4.30% | 4.25% | 4.75% |
| 2023 (end) | 5.50% | 4.40% | 4.35% | 4.85% |
| 2024 (mid) | 5.50% | 4.40% | 4.40% | 4.65% |
| 2024 (end) | 4.50% | 4.30% | 4.20% | 4.50% |
| 2025 (mid) | 4.50% | 4.40% | 4.35% | 4.45% |
| 2025 (end) | 3.75% | 4.30% | 4.25% | 4.40% |
| 2026 (Sept. 24) | 4.00% (raised 9/16) | 3.50% | 3.00% | 3.30% |
The Fed cycle, in plain English
2020-2021: COVID emergency cuts
Fed slashed from 1.75% to 0.25% in March 2020. HYSA rates collapsed by ~70% within 12 months. Marcus went 1.55% → 0.50%. Ally went 1.60% → 0.60%. The drop was painful for savers who'd just opened HYSAs at the 2019 peak.
2022-2023: Inflation-fighting hike cycle
Fed hiked from 0.25% to 5.50% over 18 months, the fastest hike cycle since the early 1980s. HYSA rates roared back, hitting 4.40-5.25% by mid-2023. Savers who'd parked money at the 0.50% bottom finally got real yield, if they remembered to move it.
2024-2026: Cuts, a pause, then a hike
The Fed held at 5.25-5.50% until September 2024, then cut 1.75 points by December 2025, to 3.50-3.75%. It held through its July 2026 meeting and raised its target to 3.75-4.00% on September 16, 2026 (FOMC statement, September 16, 2026). Top HYSAs fell with the 2024-2025 cuts: on September 24, 2026, Marcus paid 3.50%, Synchrony 3.30% and Ally 3.00% APY, with the top of the market around 4.00% (bank sites).
The full Fed cycle, 1995-2026 (broader pattern)
| Period | Fed funds range | HYSA range (approx) |
|---|---|---|
| 1995-2000 boom | 4.75-6.50% | 4.00-5.50% |
| 2001-2003 cuts | 1.00-6.50% | 0.75-5.50% |
| 2004-2007 hike cycle | 1.00-5.25% | 0.75-5.30% |
| 2008-2015 zero-rate | 0.00-0.25% | 0.50-1.20% |
| 2015-2018 normalization | 0.25-2.50% | 0.75-2.30% |
| 2019 mini-cuts | 2.50-1.75% | 2.30-1.60% |
| 2020-2021 COVID | 0.00-0.25% | 0.50-1.05% |
| 2022-2023 hike | 0.25-5.50% | 1.20-5.25% |
| 2024-2025 cuts, 2026 hike | 5.50% to 3.75%, then 4.00% (Sept. 2026) | 3.00-4.00% (Sept. 2026) |
The lesson: HYSA rates are loaned, not owned
You don't own a HYSA rate. The bank pays whatever they choose to pay, within posted disclosures, and changes it whenever the market moves. The 3.50% Marcus paid on September 24, 2026 is a snapshot, not a contract.
Compare with a MYGA, where the rate is contractually fixed for the full term. A 5-yr MYGA at 5.65% pays 5.65% in year 5 regardless of what the Fed does. The carrier takes the rate risk; you keep the rate.
Why this matters for your decision now (September 2026)
The June 2026 version of this page said the Fed had begun easing and expected 100-200 bps more cuts. That didn't happen: the Fed held through July and raised its target on September 16, 2026. Nobody knows the next move. What a MYGA does is take the question off the table for the money you lock. Two outcomes:
- If rates fall: the MYGA keeps its rate for the term while HYSA rates drop with the Fed.
- If rates hold or rise: the MYGA still paid more than most HYSAs on September 24, 2026 (A-rated-or-better 5-year MYGAs about 5.80-6.00%, AnnuityRateWatch, vs 3.00-4.00% for top HYSAs), and tax deferral adds to that. What you give up is the chance to move the locked money into a higher rate later.
The MYGA leads in both cases at September 2026 rates. It leads by more if the Fed cuts.
What savers got wrong in 2020-2021
Many savers in 2019 sat in 1.80% HYSAs thinking "rates can't drop much." Then COVID hit. By late 2020, those same accounts paid 0.50%. Savers who had locked 5-yr MYGAs at 3.50% in late 2019 were sitting on a 300 bp advantage that lasted until 2023.
The lesson is not that a cut is coming; the Fed's last move, on September 16, 2026, was a hike. It's that a variable rate can fall fast once the Fed does cut, and a lock removes that risk for the money you lock.
What if rates DON'T drop?
This is 2026 so far: the Fed held, then raised its target to 3.75-4.00% on September 16, 2026. HYSAs stay competitive with each other, and the MYGA buyer gives up some flexibility (couldn't capture a higher HYSA rate in year 3 if one appears). But:
- The MYGA's tax deferral still adds 50-80 bps net at high brackets
- The 5.65% MYGA rate was 110-140 bps above June 2026 HYSA rates
- The MYGA buyer is not worse off; just less ahead
This is asymmetric: locking benefits more if rates drop than it costs if rates rise.
Related research
- HYSA vs MYGA, the full side-by-side
- Best HYSA Rates 2026
- The 5-Year MYGA
- CD vs MYGA
My take
HYSA rates have ranged from 0.40% to 5.25% over the past 6 years. The Fed drives every move. For emergency funds and short-term cash, that variability is acceptable. You weren't trying to lock a multi-year rate anyway. For 3+ year money, the variability is the problem. A MYGA at 5.65% locked for 5 years removes the variability and historically outperforms holding a variable HYSA through an easing cycle by a wide margin. Locking gains the most when the Fed cuts; at September 2026 rates it still paid more than a HYSA when the Fed didn't. Base the decision on when you need the money, not on a Fed forecast.
About Hans Goldstein: Independent retirement income specialist. CA Life License #4273294. NPN #20602398. Reviews 30+ annuity carriers and the leading bank HYSAs. Hans does not earn commission on HYSAs or CDs. These reviews are written for the same risk-averse savers who often end up as MYGA buyers when they need 3+ year money. Phone: 213-414-2808. Email: hans@hansgoldstein.com.
Frequently asked questions
Run the MYGA vs HYSA math for your situation
Independent. Licensed. No carrier captive.
HYSAs are the right home for 1-12 months of cash. For 3+ year money, a MYGA typically pays 50-120 bps more and defers tax, a combo that quietly adds 15-25% to your effective yield in a high bracket. Worth 15 minutes to run your real numbers.
Send your details. Within one business day you'll get a written side-by-side: your current HYSA yield (after tax) vs. the top MYGAs available for your state today.
Rather talk it through? Or book 15 minutes on Hans’s calendar, or call 213-414-2808.
Hans Goldstein · 213-414-2808 · NPN 20602398, independent licensed insurance producer appointed with multiple A-rated carriers
We’ll email it to you. Hans replies within one business day. Privacy Policy.
Disclosure
This review is based on the carrier's public product materials and rates as of the date shown above. HYSA APYs are variable and change frequently. Confirm current values directly with the bank before opening an account. FDIC insurance covers up to $250,000 per depositor, per insured bank, per ownership category. MYGA rates referenced are illustrative top-of-market quotes as of 2026 and depend on state, carrier appointment, and product approval; not all MYGAs are available in every state. This is general education, not a personal recommendation or an offer of any product. Hans Goldstein is an independent licensed insurance producer (NPN 20602398) appointed with multiple A-rated carriers across the annuity market; Hans is not a banking representative and does not earn compensation on HYSA or CD products. Tax discussion reflects federal law as of 2026 and is subject to change. State tax treatment varies. Always read the actual bank disclosure and consult a licensed advisor or CPA before reallocating retirement-bound funds.