Is your money just sitting in a checking account? If so, you aren’t taking advantage of its full potential. Your checking account could earn you hundreds of dollars every year – but only if you have the right kind of account.
A high-yield reward checking account can put your money to work, helping you earn more money on every deposit. It’s the perfect way to increase your funds and reach your savings goals. And they come with plenty of perks.
What Is a High-Yield Reward Checking Account?
A high-yield reward checking account could help you earn hundreds of dollars in extra money. Each month, the money you have sitting in your checking account will earn interest. Because it’s a high-yield account, you’ll earn interest faster and at a higher rate than the average checking account. A high-yield reward checking account can offer up to double the interest rates of big banks.
High-yield reward checking accounts aren’t common, and they aren’t offered by every bank. Big banks tend to offer the lowest interest rates, which means you aren’t going to find these lucrative interest accounts at most national bank chains.
Small, regional banks and credit unions are where you’ll most likely find high-yield reward checking accounts. According to Lifehacker, smaller banking institutions have more flexibility and will offer as much as 5 percent in interest on high-yield accounts. You can also get additional benefits, such as low or no fees, smaller deposit minimums, and fewer account requirements.
Opening a high-yield reward checking account is easy. You’ll need to meet the balance requirement (which can be anywhere from $1,000 to $25,000), schedule a regular direct deposit, and meet any other requirements the bank asks for, such as a certain number of debit transactions or a minimum balance each month.
High-Yield Reward Checking Accounts Offer Higher Interest
High-yield reward checking accounts are like a regular checking account, but most checking accounts don’t offer an interest rate. If they do, it’s usually quite low. But there’s one particular perk to opening a high-yield reward checking account: it comes with a higher interest rate that the average bank can’t offer or match.
High-yield reward checking accounts offer interest rates that simply can’t be matched. And right now is a fantastic time to open a high-yield reward checking account. According to DepositAccounts.com, high-yield reward checking accounts are seeing interest rates at a 5-year high right now – meaning you can get a rare, even higher interest rate.
Additionally, interest rates are stagnating at other banks – particularly national bank chains. But high-yield reward checking accounts offered by smaller banks are seeing interest rate increases. Bankrate reports that these accounts are, on average, offering above-market interest rates better than those offered on savings accounts, CDs, or investments.
Every percent of interest makes a significant difference. For example, if you earn the average interest rate of 1 percent on $25,000, you’ll earn just $250 in one year. However, if you put that same $25,000 in a high-yield reward checking account with an interest rate of 3 percent, you’ll earn $750 in the very same year.
You’ll Earn Cash Back for Debit Card Purchases
On top of great interest rates, reward checking accounts come with another perk: you’ll earn cash back for using your debit card.
Typically, cash back rewards are reserved for credit cards only. But that’s the difference between a high-yield account and a high-yield reward account. In addition to earning interest at a high rate, you’ll also have the opportunity to earn anywhere from 1 to 5 percent cash back in the form of debit card rewards on every purchase.
Your specific bank or credit union will have its own unique rewards program, but typically, account owners are able to use their cash back rewards in a few ways. You can deposit your earnings right into your checking account or cash them in for different kinds of rewards, like gift certificates for online or local retailers.
There’s Zero Risk
While your money is sitting in a high-yield reward checking account, you don’t have to worry about what’s happening to the cash you “invested” in your account. Unlike other investments, there’s little risk. Because you’re placing your money in the bank, it’ll be backed by the FDIC just like any other account.
High-yield reward accounts are similar to CDs and money market funds. They offer high levels of return for your money, but there’s minimal risk. The odds of losing any cash are slim to none.
Additionally, high-yield reward checking accounts don’t stop you from accessing your money. You’re free to withdraw or deposit money at any time, just like you would with a regular account. Your money and earnings won’t be tied up for years at a time like with CDs or money market funds.
Find the Right High-Yield Reward Checking Account Today
A high-yield reward checking account is a smart place to store your money. With interest rates higher than both average checking and savings accounts, a high-yield account gives you the chance to earn additional money – money that you don’t have to actively invest or move to increase.
If you’re ready to take advantage of all the perks offered by high-yield reward checking accounts, you simply need to find the right account for your finances. Remember, not all banks offer these kinds of accounts; it’s likely that your current bank isn’t going to give you an account with high interest rates.
How can you find these accounts if they aren’t readily available? You’ll need to do your homework, searching online in order to find all of the currently available account options. Start your search for high-yield reward checking accounts by searching online for banks and credit unions in your area. You’ll then want to search specifically for high-yield accounts that offer the benefits and interest rates you’re looking for.
As you search online for high-yield reward checking accounts, make sure to compare interest rate offers and see if different banks can match or offer better rates. You can easily compare all of the available high-yield account options at banks near you online, making the search easy if you do your homework.
With a high-yield reward checking account, the opportunities to earn money on top of your regular deposits are endless – and you can start reaping the rewards as soon as you find the perfect account for you needs.