Deposit Beta 2026: Why Your Savings Rate Lags the Fed

Key Takeaways

✦Deposit beta is the share of a Fed rate move a bank passes through to savers; big banks run it near zero, which is why their rates barely move.
✦Online and high-yield banks run a high deposit beta and track the Fed closely, which is the entire reason their rates sit near the top.
✦You cannot change a bank's beta, but you can move your cash to a high-beta bank whose rate actually follows the Fed.

After the June 2026 meeting, with the Fed holding at 3.75% and its own projections now leaning toward hikes, millions of savers will check their accounts and ask the same thing: the Fed is keeping rates high, so why is mine still nothing? The answer has a name. It is called deposit beta, and once you understand it, the fix is obvious. Savings rates on this page were last verified recently.

Deposit beta is the fraction of a Fed move that a bank passes through to its depositors. A beta of 1.0 means the bank hands savers the entire increase. A beta of 0 means it keeps all of it. Your bank's beta, not the Fed, decides what your rate does.

The Fed opens the tap. A low-beta bank keeps the valve nearly shut.

Why big banks keep the valve shut

A bank with trillions in deposits that customers never move has no reason to pay more. It can let the Fed raise rates, keep paying you almost nothing, and pocket the difference. That is a deposit beta near zero, and it is a deliberate strategy, not an oversight. The largest banks have run it for years, which is why their savings rates sit near 0.38% no matter what the Fed does. The mechanics are spelled out in why big banks pay 0.01%.

An online or high-yield bank plays the opposite game. It has no branch network and competes for every deposit on rate, so it passes through most of a Fed move and keeps its rate near the top of the market. That is a high deposit beta, and it is the entire reason high-yield accounts exist.

Deposit beta made visible

You do not need a bank's internal data to see its beta. The market shows it directly. The national average savings rate sits near 0.38% while top accounts pay 4.40%. That spread is deposit beta made visible: the near-zero-beta banks anchoring the average, and the high-beta banks pulling away at the top. SwitchWize tracks these rates across institutions over time, which is how the Bank Gap Index turns the dispersion into a single dollar figure.

What beta looks like by bank type

Bank type	Deposit beta	What your rate does
Largest national banks	Near zero	Barely moves; stuck near the average
Regional and community banks	Low to moderate	Lags the Fed by months
Online and high-yield banks	High	Tracks the Fed near the top of the market

Beta cuts both ways, and you still win

A fair objection: a high-beta bank also passes through rate cuts faster, so its rate falls quicker when the Fed eases. True, but you start from a far higher rate, so the gap to a near-zero big-bank account stays wide in either direction. Over a full cycle, the high-beta account wins on total interest, which is the same reason waiting for the Fed rarely helps: the bank, not the cycle, sets your rate.

Quick answers

Why is my rate not going up with the Fed? Your bank has a low deposit beta and keeps the Fed's increases instead of passing them to you. The fix is to move the money to a high-beta bank.

What is a good deposit beta? For a saver, higher is better. High-yield online banks effectively run a high beta and stay near the top of the market.

How do I know my bank is low-beta? If your rate is near the 0.38% national average while top accounts pay far more, it is keeping the Fed's increases for itself.

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Methodology

Deposit beta is an established banking concept; the figures here describe the well-documented pattern that the largest banks pass through little of a Fed move while online banks pass through most of it. SwitchWize tracks deposit APYs across institutions daily from bank websites and regulatory filings, cross-referenced against FDIC national rate data. Rate figures are live snapshots. This is educational information, not personalized financial advice.

The Bottom Line

Deposit beta is why your savings rate barely moves when the Fed does: big banks pass almost none of a Fed move through to you, while online banks pass through most of it. You cannot change your bank's beta. You can move your cash to a high-beta bank whose rate actually tracks the Fed, and capture the increases your current bank is keeping.

What to Do Now

Compare your current savings rate to the national average and the top available rate.

If you are near the average, your bank is low-beta; move to a high-yield account that tracks the Fed.

Stop waiting for the cycle to fix a rate that the bank, not the Fed, is choosing to keep low.

Frequently Asked Questions

Why is my savings rate not going up when the Fed raises rates?

Because your bank has a low deposit beta, the share of a Fed move it passes through to savers. Big banks keep deposit beta near zero on purpose: they hold trillions in sticky deposits and have little reason to pay more. Online and high-yield banks compete for deposits, so they run a high beta and raise rates much faster. If your rate barely moves, the fix is to move the money, not to wait.

What is a good deposit beta?

From a saver's point of view, higher is better, because it means more of any Fed increase reaches you. High-yield online banks effectively run a high beta and keep their rates near the top of the market. A big-bank account running a beta near zero is the one to leave, since it captures the Fed's increases for itself rather than passing them to you.

Does deposit beta work both ways?

Yes. A high-beta bank passes through more of a rate cut too, so its rate falls faster when the Fed eases. But you are still better off, because a high-beta account starts from a much higher rate. The gap to a near-zero big-bank account stays wide in either direction.

How do I know if my bank has a low deposit beta?

Compare your current rate to the national average and to the top available rate. If you are near the national average of about 0.38% while top accounts pay multiples of that, your bank is running a low beta and keeping the Fed's increases instead of sharing them. That gap is the signal to switch.

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