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How Much Interest Can You Earn on 1 Million Dollars?

Jeremy Flint Updated: November 27, 2023 • 6 min read
Lendstart computer screen with 1 million in numbers in an office

Key Points:

  • The best way to invest $1 million to earn interest depends on your risk profile and how easily you need to access your cash.

  • High-yield savings accounts are the most liquid but yield less than Treasury-issued securities.

  • If you’re investing long-term, you’re better off buying stocks or real estate than sticking with interest-producing assets.

Investing $1 million was a great way to earn enough money for retirement. But now, due to rising prices, it might not be enough. However, if you're not retiring soon, you can still use this amount to build a good income. This involves understanding how to earn more through compound interest, which grows your money over time.

Why You Should Invest in Interest-Producing Assets?

Interest-producing assets lie on the safest spectrum if you simply want to generate a million-dollar interest. Interest-producing assets, in general, exchange your capital for the promise of a fixed rate paid monthly, quarterly, or even biyearly. 

  • Steady Income: They provide a regular and predictable amount of money, which is helpful for budgeting and planning.
  • Lower Risk: These assets are generally safer and less likely to lose value, making them a good choice for cautious investors.
  • Keeping Your Money Safe: They are good for protecting the money you invest, as they are less likely to lose value than stocks.
  • Balanced Investment: Adding these assets to your portfolio can make it more stable, especially when other investments are up and down.
  • Protection Against Rising Prices: Some of these assets adjust for inflation, helping your investment keep its value even when prices go up.
  • Easy Access to Money: Many of these assets let you withdraw your money without major losses, offering flexibility.
  • Growing Your Investment: Your investment can grow faster because you earn interest on both the money you put in and the interest that has already been added.
  • Tax Benefits: Some, like certain bonds, might not be taxed, which can save you money.

To determine which interest-producing asset is best for you, you'll need to figure out two factors:

  • How liquid do you need your investment to be (i.e., how quickly can you convert the asset to cash)?
  • How much risk can you tolerate even within the "safe" sphere of interest-producing assets?

Note that, in all circumstances, we will avoid looking at holding cash in a checking account or keeping it under your mattress. In these cases, inflation will ultimately make your money worth less over time.

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The Safest Interest-Producing Assets

If you want to combine safety and liquidity, look to one of three options: savings accounts, short-term Treasury Bills, and money market accounts. 

Treasury Bills (T-Bills)

Treasury Bills, or T-Bills, are fixed-income assets issued by the US Treasury. They're like bonds, but instead of offering recurring interest (coupon), they sell for less than their face value. Then, when the T-Bill matures, you're given the full T-Bill's value.

  • Description: Short-term government securities sold at a discount, redeemed at face value at maturity.
  • Key Features: Low risk, exempt from state taxes, highly liquid.
  • Yield: Varies, e.g., 5.72% for one-year T-Bills.
  • Long/Short Term: Short-term (ranging from a few days to 52 weeks).
  • Calculation: $1 million at 5.72% yields $57,200 annually.
  • Considerations: Suitable for conservative investors seeking safety and moderate returns.
  • Average Yield: Historically, T-Bills have offered yields ranging from 2% to 5%, depending on the economic climate and maturity period.

If you’re comfortable with stocks but not ready to invest in Treasury assets directly, you can also leverage short-term bond ETFs like SGOV. SGOV invests directly in T-Bills and offers a 5.30% yield today - $53,000 on a one million dollar investment. Popular bond ETFs like SGOV are also usually highly liquid, so you can buy and sell them as long as markets are open.

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Savings Accounts

Savings accounts are highly liquid since you can easily transfer money from the account into your checking account or even withdraw directly. Likewise, they're safe because most savings accounts are FDIC-insured. This means that if the bank fails, the US government will protect your cash up to $250,000.

  • Description: Deposit accounts with banks, offering interest on balances.
  • Key Features: Highly liquid, FDIC-insured.
  • Types: Standard Savings and High-Yield Savings Accounts (HYSAs).
  • Yield: Around 0.46% for standard, 4.5% to 5% for HYSAs.
  • Long/Short Term: Suitable for both, depending on account terms.
  • Calculation: $1 million in a HYSA at 5% yields $50,000 annually.
  • Considerations: Interest is taxable; diversification across banks is necessary for FDIC coverage.
  • Average Yield: Standard savings accounts typically offer around 0.06% to 0.09%. High-Yield Savings Accounts (HYSAs) may offer between 0.5% to 1.5%, with some reaching up to 2% in favorable economic conditions.

Money Market Accounts

Banks usually offer Money market accounts and act similarly to a HYSA. The difference is that, usually, money market accounts restrict the number of withdrawals you can make each month. For example, some only let you pull cash from the account six times monthly. That's still usually enough, though, and if you plan ahead, money market accounts are very liquid.

Some banks require a minimum deposit for money market accounts, but that shouldn't be an issue if you're looking to invest $1 million!

  • Description: Interest-bearing accounts typically offer higher rates than savings accounts.
  • Key Features: FDIC-insured, may have withdrawal limits.
  • Yield: Up to 5.13%.
  • Long/Short Term: Flexible, with some restrictions on transactions.
  • Calculation: $1 million at 5.13% yields $51,300 annually.
  • Considerations: Optimal for investors seeking a balance between accessibility and higher interest rates.
  • Average Yield: Typically, these accounts offer yields slightly higher than savings accounts, averaging around 0.3% to 0.6%.

Riskier Interest-Producing Assets

Although each interest-producing asset tends to be the safest and most liquid, you might want a little more juice for your squeeze. That's reasonable. We won't look at each of these too closely but instead, point to other options to research if you want to maximize your yearly interest on $1 million dollars and can stomach the risk or don’t need quick access to your cash.

Certificates of Deposit (CDs)

Certificates of Deposit, or CDs for short, are like HYSAs on steroids. Some CDs pay interest often throughout the CD's lifespan, while some won't pay any interest before maturity. Make sure to check the CD’s terms before buying! 

  • Description: Time-bound deposits with fixed interest rates.
  • Key Features: Fixed returns, FDIC-insured.
  • Yield: Ranges, e.g., 5.55% for one year.
  • Long/Short Term: Both, with terms from a few months to several years.
  • Calculation: $1 million in a one-year CD at 5.55% yields $55,500.
  • Considerations: Illiquid; early withdrawal incurs penalties.
  • Average Yield: The yield on CDs can vary widely, but on average, they offer rates from 0.5% for short-term CDs to around 1.5% or more for longer-term CDs.

Long-Term Treasury Notes and Bonds

Longer-term Treasury assets, like Treasury Notes (T-Notes), are a type of investment you buy at their full price. They pay you interest twice a year, known as a coupon. If you keep these Treasuries until they mature (reach their end date), there's almost no risk involved. If you need to sell them, their value might decrease depending on the economy.

Even if their value changes, you'll still receive your interest payments every 6 months and get back the full amount you originally invested when they mature. Their market value can go up and down over time. Yields range from 4.45% for ten years, or $45,500 annually on a $1 million investment, to 4.57% for thirty years ($45,700 annually). 

  • Description: Long-term government debt securities, paying fixed interest.
  • Key Features: Low risk, stable returns.
  • Yield: Varies, e.g., 4.45% for ten-year notes.
  • Long/Short Term: Long-term (10 years to 30 years).
  • Calculation: $1 million in ten-year notes at 4.45% yields $44,500 annually.
  • Considerations: Ideal for risk-averse investors, less liquidity compared to T-Bills.
  • Average Yield: Long-term notes and bonds have varied yields, with 10-year Treasury notes historically averaging around 2% to 3%, and 30-year bonds averaging slightly higher.


These are by no means the only options to invest $1 million. Beyond these basic interest-producing assets, you can also invest in corporate bonds that often yield as much as 7% annually ($70,000 annually for the bond’s duration). Getting into these and other complex securities starts tilting the risk profile heavier toward the risky side. And, of course, if you want to grow your assets and can tolerate the risk, you're likely better off investing in stocks and real estate – especially if you have a long investment horizon.

If you're looking to park $1 million for a down payment on a home or wait for market conditions to change, each option is a great option to generate interest. Just make sure you know what you're getting yourself into! 



How much interest would $1 million earn?

Investing in Treasury Bills can generate as much as $57,200 today, although interest rates change often.

How much interest will I earn per month on $1 million?

To find out how much you’ll earn monthly, divide the annual interest by 12. If you invest in a HYSA with a 4.6% yield, you’ll earn $46,000 annually - $38,33 monthly. That’s assuming you withdraw the interest monthly, though. If you let the interest compound, you can turn your annual return into $47,071!

Written by Jeremy Flint

Jeremy is a finance and investment writer who works with stock research platforms, wealth managers, and investment funds to deliver value to clients and customers. He couples his lifelong interest in financial topics with an MBA from the University of California - Davis, and loves breaking down complex topics to educate new and experienced investors alike. He lives in Austin, TX with his wife and young son.