By Bankrate, Special for USDR
Twenty checking accounts offered by U.S. banks and credit unions yield 2% or more, according to Bankrate.com (NYSE: RATE). With the average money fund yielding just 0.01%, these high-yield checking accounts can be a great alternative for qualifying savers. All 20 accounts are federally insured and, unlike a CD, completely liquid.
To receive the best rates, consumers typically must do some or all of the following:
- Make at least 10 debit card transactions each month
- Receive electronic statements
- Utilize direct deposit
- Pay bills online
“A lot of people are already doing these things,” said Greg McBride, CFA, Bankrate.com’s chief financial analyst. “By switching to a high-yield checking account, they can easily add several hundred dollars to their emergency savings each year with full liquidity and the protection of federal deposit insurance.”
High-yield checking accounts usually have balance caps (the most common is $25,000). A 2% return on a $25,000 balance is $500per year; traditional checking accounts yield an average of just 0.06% each year ($15 on a $25,000 balance).
McBride advises savers to pay close attention to balance caps and other requirements. “For a $25,000 balance, the most interest is actually generated by the account with the 16th-highest APY,” he notes. The 15 highest yielding accounts have balance caps of$15,000 or lower, and maintaining balances above the cap rarely pays off (the average payout is just 0.24%).
About half of the 56 high-yield checking accounts that Bankrate.com analyzed are available nationwide. Click here to view the full survey:
About Bankrate, Inc.
Bankrate is a leading publisher, aggregator, and distributor of personal finance content on the Internet. Bankrate provides consumers with proprietary, fully researched, comprehensive, independent and objective personal finance editorial content across multiple vertical categories including mortgages, deposits, insurance, credit cards, and other categories, such as retirement, automobile loans, and taxes. The Bankrate network includes Bankrate.com, CreditCards.com, InsuranceQuotes.com and Caring.com, our flagship websites, and other owned and operated personal finance websites, including Interest.com, Bankaholic.com, Mortgage-calc.com, CreditCardGuide.com, CarInsuranceQuotes.com, Insweb.com, CreditCards.ca, and NetQuote.com. Bankrate aggregates rate information from over 4,800 institutions on more than 300 financial products. With coverage of over 600 local markets, Bankrate generates rate tables in all 50 U.S. states. Bankrate develops and provides web services to over 100 co-branded websites with online partners, including some of the most trusted and frequently visited personal finance sites on the Internet such as Yahoo!, AOL, CNBC, and Bloomberg. In addition, Bankrate licenses editorial content to over 500 newspapers on a daily basis including The Wall Street Journal, USA Today, The New York Times, The Los Angeles Times, and The Boston Globe.
SOURCE Bankrate, Inc.