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These checking options pay more than some savings accounts
By
Sabrina Karl
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Sabrina Karl has over two decades of experience writing about savings, CDs, and other banking topics. She is currently a staff writer at Investopedia and one of the country's top experts on how to earn as much as possible on the money you hold in the bank. She previously wrote for Bankrate.com, CreditCards.com, DepositAccounts.com, and RateSeeker.
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Updated May 31, 2024
Reviewed by
Anthony Battle
Reviewed byAnthony Battle
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Anthony Battle is a CERTIFIED FINANCIAL PLANNER™ professional. He earned the Chartered Financial Consultant® designation for advanced financial planning, the Chartered Life Underwriter® designation for advanced insurance specialization, the Accredited Financial Counselor® for Financial Counseling and both the Retirement Income Certified Professional®, and Certified Retirement Counselor designations for advance retirement planning.
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Fact checked by
Maddy Simpson
Fact checked byMaddy Simpson
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Maddy Simpson is an experienced data journalist and fact-checker with a background in financial analytics.
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Holding enough money in a checking account to cover your bills and then stashing any surplus cash in a savings account is the traditional model for boosting the bank interest you can earn. But for those willing to regularly use a debit card, significantly higher earnings are available from high-interest checking accounts. These accounts, sometimes called rewards checking, offer a trade-off: If you meet a handful of requirements in any given statement cycle, the bank or credit union will pay you an interest rate for that month that is well beyond what even the best savings accounts offer. The catch is that you need to follow all of the requirements to the letter, and if you miss even one, you'll be paid little or no interest for that month. Still, the requirements aren't difficult for many consumers, and the payoff can be quite lucrative. Indeed, our ranking of the best high-interest checking accounts that are available nationwide all pay at least 4.00%, with the top-paying account reaching as high as a 6.25% annual percentage yield (APY). Compare that to high-yield savings accounts, where the best are paying better than 5.50% APY right now, while the national average rate is only 0.45% for savings accounts and 0.08% for checking accounts (as of May 20, 2024). In the News: The Fedheld rates steadyfor a sixth consecutive time at its meeting ending on May 1. The 5.25% to 5.50% range is the highest it has been since 2001, and Fed officials noted in a statement that there has been a lack of recent progress toward the committee's goal of lowering inflation. Consumer prices rose 3.5% over the year in March. Officials don't foresee reducing the target range until they are confident inflation is moving toward 2%. Interest rate hikes can directly impact the rate you receive on your high-yield checking account. Additionally, they can impact your savings account rate. It's wise to see if the bank you're using for your checking account offers a high-yield savings account. You could also see if it offers one of the best CD rates right now. Combined, these accounts could help you earn the maximum amount of money on the cash you keep at your financial institution. Note that all of the high-interest checking accounts listed below require signing up for electronic statements, and most also stipulate that you enroll in online or mobile banking. Additionally, credit unions are significant players in the high-interest checking account arena, populating the majority of our ranking slots. But don't let the name or location of a credit union fool you into thinking you can't bank with them. Many credit unions—and all of the ones we've included in our rankings here—offer a pathway for anyone in the country to join, usually for a modest fee or donation. Below you'll find the top checking account rates available from our partners, followed by our complete ranking of the best checking account rates nationwide. With its limited balance threshold, it's best for customers who keep relatively minimal funds on hand. Pelican's requirements are relatively easy to meet for those who regularly use a checking account. For those who like to keep more than $10,000 in a checking account, Credit Union of New Jersey boasts the top rate. Fitness-oriented banking customers willing to connect their daily activities to an app can earn a great rate at Fitness Bank. Orion Federal Credit Union's requirements to earn its top rate are among the easiest to meet. Direct deposit not a great option for you? Garden Savings offers one of the best APYs and a generous maximum earning balance while allowing you to qualify without establishing a direct deposit. Although this isn't the highest APY on the list, the high yield is extended to a much higher balance than with other accounts. It's also the only top-paying checking account that doesn't absolutely require debit card transactions, offering other electronic withdrawals as alternate qualifiers. This is the best high-APY nationwide checking account that we've found. But earning the top rate requires opening and actively using a credit card from the credit union. For those with a reliable direct deposit of $1,000 or more each month, Signature offers a generous maximum balance, one of the easiest debit card requirements, and a minimal cost to join. As with all banking products, it can pay to shop locally. Our rankings focus on banks and credit unions open to customers nationwide, allowing for accounts to be opened online. But with credit unions being strong players in the rewards checking realm, it's possible that a credit union in your community or state, or that serves your employer, may pay as much or more than the best nationwide options we've laid out. Or perhaps you'll find one with slightly easier requirements. The nationwide leaders above will be hard to beat in most markets. But it's always worth checking the local and regional options available specifically to you before locking into a choice. If you do only a little research on rewards checking accounts, you'll notice the word Kasasa popping up from time to time, and the odd word may leave you scratching your head. That's because Kasasa is a fabricated branding word and the name of a company that offers checking account infrastructure to banks and credit unions. What all Kasasa accounts have in common is that they offer some sort of reward, whether exceptional interest rates, cash back on debit card purchases, or more unconventional perks, and they carry no fees. By now, you understand you have to actively earn your reward with a high-interest checking account. For most people, these are not accounts you can leave on autopilot and expect to receive the maximum interest payment each month. A little bit of due diligence—both upfront and monthly—is required if you want to maximize your earnings. As you research options, be sure you fully understand what each account will require of you. Thinking through how you normally use a checking account and what behavior modifications you're willing to make (if any) will help lead you to the best rewards checking account for your needs and style. Then, once you've chosen an account, make the time investment of a phone call to a customer service representative at the bank or credit union to ask questions about the specific rules of qualifying transactions. One of the most important things to clarify is what types of debit card transactions will qualify toward the minimum number. Do they have to involve a signature? Can they be PIN-based? Do they have to be at least some minimum dollar amount? Don't stop at debit questions, though; familiarize yourself with any requirements about direct deposit or ACH transactions. Also, learn where to review the monthly qualification calendar, which will indicate the first and last days for posted transactions to count towards each monthly rewards cycle. Now that you know your marching orders for earning top dollar on your checking account balance every month, turn that information into some automated tasks that will help ensure you don't forget. Being deprived of a whole month of interest due to a single misstep can be frustrating. Adding a reminder to your phone or calendar for the same day every month, perhaps seven to ten days before the closing date for qualifying transactions, is a best practice that can help you complete any necessary actions while you still have time. The date a transaction will count towards your monthly qualification requirements is the posted date, not the actual activity date. Since it can take a day or two for pending transactions to post, be sure to initiate any needed activity a few days before the end of your qualification period. If your account has a maximum that you may sometimes bump up against, regularly pay attention to your balance. If you go a few dollars over and it's expected to be a temporary surplus, don't sweat it. But since the interest rate many of these accounts pay on the portion of your balance that exceeds the high-APY threshold is zero, or close to it, you won't want to regularly keep more than the maximum in your account. To see how much difference this can make, take the example of an account with a $10,000 maximum for earning 3.00%. At amounts above $10,000, the account pays just 0.10% APY. If you were to keep a balance of about $20,000 in the account regularly, you'd essentially be lowering your APY on that account to just 1.55% APY (the average of 3.00 plus 0.10). For those who find they're being constrained by the maximum balance threshold on their high-yield checking account, a savvy move is to pair it with a high-yield savings account. The savings account can be at the same institution or an entirely different one. You can find our ranking of the top-paying national savings accounts here. The key is simply to create an electronic link between your two high-yield accounts so that you can easily transfer surplus funds that exceed your checking account's maximum allowance into a savings account that may pay 10x as much as the surplus funds would earn in checking. Conversely, if your checking account balance falls below the high-APY threshold, you can transfer funds from savings back to checking to maximize your high-yield earnings. Pros Offer a higher interest rate than traditional checking accounts Give you easy access to your cash May come with bonus perks and benefits Cons May require a certain balance to earn the highest rate Could have rules around minimum balances or transactions per month Rate could decrease over time A high-yield checking account may not be the best fit for everyone. Here are some alternative options to explore. A high-yield checking account is a type of checking account that earns higher-than-average interest. According to the FDIC, the average checking account interest rate is only 0.08% as of May 20, 2024. High-yield checking accounts may earn rates up to 6.00% or higher. A high-yield checking account may be worth it if earning interest on your checking account balance is a priority. If you only keep a small amount of cash in your checking account, a high-yield savings account may be a higher priority. When determining whether a high-yield checking account is worth it, keep an eye out for any rules or restrictions that wouldn’t be a good fit for your spending habits, such as account or transaction minimums. Some financial institutions that often pay among the highest interest rates on checking accounts include La Capitol Federal Credit Union and Pelican State Credit Union, with rates of 6.25% APY and 6.05% APY, respectively. Yes, high-yield checking accounts exist at various banks and online financial services companies. Compare the options above from multiple institutions to find the best APY on a high-interest checking account. A high-yield investor checking account is a checking account that’s linked to a brokerage account and usually has a higher-than-average interest rate. You can find investor checking accounts from brokerages like Charles Schwab. A brokerage checking account may make it easier to invest your money, but you may be able to find a higher checking account or savings account APY from a bank. To choose the best high-yield checking accounts, we scanned online resources for banks and credit unions that offered checking accounts with the highest annual percentage yields (APYs). Institutions had to be federally insured (by FDIC for banks and NCUA for credit unions); the maximum allowable balance that could earn the high rate had to be at least $10,000; and the number of required debit card transactions could not exceed 15. Best High-Yield Checking Accounts
In the News
La Capitol Federal Credit Union – 6.25% APY
Pelican State Credit Union – 6.05% APY
Credit Union of New Jersey – 6.00% APY
Fitness Bank – 6.00% APY
Orion Federal Credit Union – 6.00% APY
Garden Savings Federal Credit Union, Platinum Rate Rewards Checking – 5.12% APY
Presidential Bank, Advantage Checking – 4.62% APY
Consumers Credit Union, Rewards Checking – 5.00% APY
Signature Federal Credit Union, High-Yield Checking Account – 4.00% APY
You May Be Able to Earn Even More
What Is Kasasa?
Tips for Succeeding With High-Yield Checking
Be Sure You Thoroughly Understand the Requirements
Set Some Monthly Reminders
Watch Out for Account Maximums
Pair Your High-Yield Checking With High-Yield Savings
Pros and Cons of High-Yield Checking Accounts
Pros Explained
Cons Explained
Alternatives to High-Yield Checking Accounts
Frequently Asked Questions
What Is a High-Yield Checking Account?
Are High-Yield Checking Accounts Worth It?
Which Banks Pay the Highest Interest on Checking Accounts?
Do High-Yield Checking Accounts Exist?
What Is a High-Yield Investor Checking Account?
Methodology
Article Sources
Investopedia requires writers to use primary sources to support their work. These include white papers, government data, original reporting, and interviews with industry experts. We also reference original research from other reputable publishers where appropriate. You can learn more about the standards we follow in producing accurate, unbiased content in oureditorial policy.
Federal Deposit Insurance Corporation. "National Rates and Rate Caps."
Federal Reserve. "Federal Reserve Issues FOMC Statement."
Bureau of Labor Statistics. "Consumer Price Index."
La Capitol Federal Credit Union. "Choice Checking."
Pelican State Credit Union. "Reward Checking Accounts."
Credit Union of New Jersey. "Kasasa Cash Checking."
Fitness Bank. "Open an Elite Checking Account."
Orion Federal Credit Union. "Account Disclosures."
Orion Federal Credit Union. "Checking."
Garden Savings Federal Credit Union. "Rates."
Garden Savings Federal Credit Union. "Platinum Rate Rewards Checking."
Presidential Bank. "Schedule of Fees."
Presidential Bank. "Deposit Rates."
Presidential Bank. "Checking."
Consumers Credit Union. “Rate Schedule.”
Consumers Credit Union. "Rewards Checking."
Signature Federal Credit Union. "Checking."
Federal Deposit Insurance Corporation. "National Rates and Rate Caps."
Related Terms
What Is a High-Yield Checking Account?
A high-yield checking account provides interest at an above-average rate, in some cases above 5% or 6% APY. But these accounts usually come with stringent requirements.
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What Is a Checking Account? Here's Everything You Need To Know
A checking account is an account held at a financial institution that allows deposits and withdrawals. Learn how checking accounts work and how to get one.
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Money Market Account: How It Works and How It Differs From Other Bank Accounts
Money market account is an interest-bearing account at a bank or credit union, not to be confused with a money market mutual fund.
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What Is a Student Bank Account?
Student bank accounts are accounts designed for teens and young adults. Learn about the features of a typical student bank account and how to compare them.
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Inactivity Fee: What It Is, How It Works, and Example
An inactivity fee is a sum charged to consumers who don't execute any transactions
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State Employees' CredIt Union (Secu): What It Is, How It Works
The State Employees’ Credit Union (SECU) is a nonprofit financial institution owned by employees of the State of North Carolina.
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