High Yield Checking Accounts - Earn Money With Your Checks
It is possible to actually make money with a checking account. While you probably won't gain much interest if any on most free checking accounts offered by your bank, there are high-yield checking accounts that offer some nice perks.
The interest rate is usually much higher than the rate connected to the average savings account. These accounts are just another reason why it's smart to keep using personal checks.
Of course, there's always a catch. You will have to jump through some hoops to make sure that the interest you are paid on the balance in your account each month isn't lowered dramatically.
Banks and credit unions offer high-yield checking accounts (also known as rewards checking accounts) with interest rates from anywhere between .75 percent to more than six percent. Sometimes these types of accounts are only available to local customers, however, many offer out-of-state accounts as well.
Some of the most common requirements for rewards checking include a minimum number of debit card transactions per month, direct deposit and use of online bill pay or regular access to online banking. In fact, Bankrate.com conducted a survey of banks that offer high-yield checking accounts and discovered more than 90% require users to use either direct deposit or online bill pay to qualify for the top interest rate.
If you fail to meet guidelines and standards set up by the bank or credit union holding your rewards checking account, your rate of return could be lowered to as low as .04%.
You will probably want to keep a high balance in your rewards checking account as it offers greater yields than your normal account. But keep in mind that most financial institutions have a balance cap that limits how much money on which you can earn interest.
Many banks have a threshold that only pays interest up to a certain dollar amount. For most accounts it is common to have a balance cap of around $25,000. But some institutions that have a particularly high interest rate may have a significantly low balance cap. Bankrate.com mentions a credit union that offers a rate of 6.17%, but imposes a $500 balance cap.
Experts say you should look at your high-yield checking account as a place to store your savings, not a place to use for lots of spending. They suggest using the account to make common low-cost transactions such as filling up your gas tank, or buying a few groceries. Don't use the account to purchase large expensive items like new furniture. Obviously that would drain the balance in your account making it less profitable.
Reward checking can also be more profitable for financial institutions. Customers tend to stick around longer and keep more money in their account.
Remember to look over all the details of your high-yield checking account before making a final decision. Every bank has different rules, regulations and loopholes.
You can also save money when you order checks online from Check Advantage. Find fun personal check designs in our Cool Checks and Cute Checks categories. Plus - you could save up to 75% off of what your bank charges.
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