Do frozen savings earn interest?

What do you mean by frozen? I’d think it depends on account type bank, etc.

An account frozen by say the IRS just means you can’t withdraw or take credit’s from it.
You can still deposit or transfer into it. The bank account stays at whatever interest rate it is set at.
The freeze comes from external to the bank actions.

Some banks will ‘freeze’ an account if there is no action (deposits, credits, checks, etc.) in a certain amount of time, based on bank policy. (This happened to me in 2024 – I had a money market account that had just been sitting there for a couple years, and I got a letter that it was ‘frozen’ and I need to call the bank to prove I was still alive (or something like that).

Anyway, the account continued to earn interest during the several weeks it was frozen.

State law comes into play as well. If you just let an account site for a couple years, by law, the bank has to turn the $$ over to the state, and the state holds it in its “Unclaimed Funds” account forever. It doesn’t earn interest there.

(Every state has an ‘unclaimed funds’ website – you should check the one for your state to see if there is money waiting for you. Several years ago, I checked the one for a state I lived in in 1991 – there was $57.00 waiting for me. I filed and got a check several weeks later.)

@elbanditoroso I need to remember to make a couple of claims, one is for $2000. It just seems like such a hassle to go through – proving who I am, proving who my mom was, etc. Paperwork and phone calls to lawyers. I keep putting it off.

Yeah, in my experience with US banks, they eventually try to steal your money in unattended accounts, in various ways. Either they quietly shut down your account and pillage it, or they add a regular fee to an account that had no fee, which sucks it dry. Even when I had gotten multiple assurances they would not do that. Bank of America, Wells Fargo, and US Bank have all tried and/or succeeded in doing that to me.

@smudges well, in my case, it was filling in a web form and swearing I was honest (and gave my SSN and address) so it wasn’t that onerous. I didn’t need to prove my parentage or anything like that. But the amount was small.

Still, $2000 seems a worthwhile use of time.

Yes, it’s on my near-future to do list.