If you have most of your money stashed in a basic savings account at a major bank, there's a pretty good chance you're making next to nothing keeping your money there.

Even though the Federal Reserve has been rapidly raising borrowing rates, the interest paid out to savers is a pittance.

The national average savings interest rate is 0.23%, according to Bankrate.com. That's a measly $35 for an annual $10,000 savings deposit.

But it doesn't have to be that way.

Many credit unions and smaller institutions offer much better returns than the big banks, yields that can help savers recoup some of the money being lost to inflation.

It may take a bit of research and time, but the returns could add up and be worth it in the long run.

"Having your money in the right place could be earning you the best yields you may have seen in the last 15 years," says Greg McBride, chief financial analyst at Bankrate.

What to consider if you want to move your money

There is no shortage of credit unions and online accounts that offer relatively high rates of return for basic savings accounts, and researching each one to make sure they're covered by Federal insurance and don't have hidden fees or questionable terms can be time-consuming.

You will also want to make sure to reroute any long forgotten auto payments and be aware that transferring money between accounts may not be instantaneous.

What you get for moving your money into a higher yield savings account may not be life-changing, but over time — and in light of high inflation — it may be worth the initial hassle.

"As a saver, this is the only free lunch in finance," says McBride.

Why the skimpy rates from the big banks?

The rates banks pay for people to save with them depends on how much they need those deposits. And the fact is, many big banks have plenty of money and don't really need more deposits.

During the pandemic, people's savings soared. Government stimulus checks helped boost household income while household spending dropped and a lot of the excess savings ended up at those bigger banks. To maximize profits, many have maintained the low interest rates they pay out to savers.

"They're running a business and so what they pay on deposits is not done out of benevolence," says McBride. "What they're trying to do is keep their cost as low as possible until they can lend out what they have."

How smaller banks can offer better deals

Smaller institutions that are eager to bring in deposits are doing so by offering their members higher interest rates.

"We've increased our deposit rates now 15 times over the last eight months," says Dennis Devine, CEO of Alliant Credit Union, which currently offers its members 3% on savings accounts. The rates are even higher at some other credit unions and small banks.

One of the main reasons smaller banking institutions can offer better returns is because of their more modest footprints.

"You're likely to get a higher rate with a credit union or an online bank simply because they don't have the large overhead that major brick-and-mortar banks do," says Chanelle Bessette, a banking specialist at NerdWallet.

There is also no pressure to continuously impress shareholders.

"Rather than having to worry about, what does the shareholder return look like at the end of the quarter, we're able to think entirely about how do we do what's in the best interest of our members," says Devine. "Our members are the owners of the credit union."

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