This was originally published on The Penny Hoarder, which helps millions of readers worldwide earn and save money by sharing unique job opportunities, personal stories, freebies and more. The Inc. 5000 ranked The Penny Hoarder as the fastest-growing private media company in the U.S. in 2017.
When you think of interest-generating bank accounts, your mind likely goes to savings. After all, that’s your reward for building an emergency fund or socking away money for a future expense, right? A regular, end-of-month deposit into your savings account, courtesy of your bank.
The good news: You can also earn interest with select checking accounts.
What Is a High-Interest Checking Account?
A high-interest, or high-yield, checking account offers a higher interest rate (annual percentage yield, or APY) on your money. Unlike a traditional checking account, you may have to keep a minimum balance in the account at all times and meet other requirements — for instance, pay a monthly fee, make a certain number of debit card purchases or schedule a recurring direct deposit — to earn the higher interest rate.
High-interest checking accounts are a solid way to earn more for your money. Whether you bank with a federal credit union, online bank or other type of financial institution, high-yield checking accounts can be a great place to store your cash.
Here’s an overview of high-yield checking accounts, what you need to know when choosing one and the top checking accounts available in the market today.
The 7 Best High-Interest Checking Accounts
Name
APY
Monthly Fees
SoFi Checking and Savings
1.00%
None
NBKC Everything Checking Account
0.15%
None
Consumers Credit Union
2.09% to 4.09%
None
Charles Schwab High Yield Investor Checking
0.03%
None
Capital One 360 Checking Account
0.10%
None
Ally Interest Checking Account
0.10% to 0.25%
None
Axos Rewards Checking
1.00%
None
Here are the seven best high-interest checking accounts where you can save your money and make a little more at the same time.
SoFi Checking and Savings
Free debit card
Fee-free ATM usage via Allpoint
Overdraft protection
SoFi Banking takes a number of steps to make the transition to online banking easy:
Through a partnership with Allpoint, account holders won’t pay fees at 55,000 ATMs worldwide.
Overdraft protection — SoFi members who meet certain criteria and accidentally spend more than they have in their account will be covered up to $50 with no fees.
SoFi’s website and mobile apps have detailed FAQs, and they make it simple and easy for you to find any information you want.
NBKC Everything Checking Account
24/7 mobile banking
Up to $12 monthly ATM-fee reimbursement
No foreign transaction fees
The NBKC Everything Checking Account offers other perks, too:
Access to over 37,000 ATMs. Keep in mind that the mega-banks, like Wells Fargo and Bank of America, have less than 20,000 in-network ATMs. Plus, NBKC will reimburse you up to $12 monthly to refund those pesky, out-of-network ATM fees.
24/7 mobile banking.
The ability to set up auto-pay for recurring bills.
Consumers Credit Union
Free nationwide checking
Anyone can join CCU
Can bank online or in person
Consumers Credit Union knows plenty of people still write checks so it allows unlimited check writing. Plus, there is a feature to get paid at day early when you have direct deposit and your employer has provided the requested information. Consumers brags that clients with balances up to $10,000 can earn 80x the national average.
Capital One 360 Checking Account
70,000 fee-free ATMs
24/7 banking
Options for overdraft protection
If you’re looking for a bank with a lot of clout in the industry and both in-person and online banking options, the Capital One 360 checking account could be a solid option for you. In December 2021, Capital One became the largest bank in the country to eliminate all overdraft fees.
Charles Schwab High-Yield Investor
Low opening requirement
Unlimited ATM fee rebates worldwide
Need linked brokerage account
With no foreign transaction fees and top-notch security, this account could work for you if you’re a frequent traveler. Another perk: You can manage all of your Charles Schwab accounts in one place. That means no juggling multiple logins and websites to access your funds.
Ally Interest Checking Account
40,000 fee-free ATMs
No overdraft fees as of 2021
Super-transparent fees
Overall, Ally is an online-only bank with a pretty good high-yield checking account. Last year, Ally Bank eliminated overdraft fees on all accounts for all customers. Another perk is Ally’s super-transparent fees. For example, there’s no gray area over what an outgoing domestic wire will run you ($20).
Axos Rewards Checking
Access to 24/7 to virtual financial assistant
Free debit card
Low minimum opening deposit
Here are the guidelines to receive the higher rate from Axos Bank: Receive $1.5K or more monthly deposits (0.40%), use your Axos debit card for 10 (minimum of $3) transactions (0.30%), maintain at least $2,500 per month in an Axos Invest Managed Portfolios Account (0.10%), have a daily balance of $2,500 per month in an Axos Invest Self Directed Trading Account (0.10%) and use your Rewards Checking account to make an Axos consumer loan payment in full each month (0.10%).
Why You Should Consider High-Yield Checking Accounts
We’ll be honest — with today’s interest rates, you won’t be raking in the dough like in years past. The national average for interest checking accounts is a not-so-hot 0.03% annual percentage yield (APY), according to the FDIC.
However, if you can earn something versus nothing for keeping your money in a checking account, we think it’s worth exploring. Any secure account where you can safely store and grow your money is a win in our book.
Check out our current list of bank promotions for a chance to gain a monetary bonus when signing up for a new bank account.
Who Can Get a High-Yield Checking Account?
The short answer? Anyone 18 years old and up. To open any account in the U.S., you typically need the following:
Be age 18 and older
A U.S. citizen
Your social security number
A government-issued ID
Certain accounts might suit different individuals better. For instance, a super-organized person who can meet some banks’ regular requirements to earn a higher interest rate might fare better with one type of account than someone who’s more of a “set it and forget it” type who will be fine with a lower rate and fewer requirements.
Regardless, anyone can benefit from a high-interest checking account.
How Banks Offer Higher Interest Rates
Banks offer attractive rates to incentivize people to open accounts with and keep their money with them. Some companies are able to offer even higher rates than their competitors. For example, online-only banks typically have an edge here. They have less overhead than their brick-and-mortar counterparts and can pass these savings (in the form of higher interest rates) on to consumers.
What to Look for When Opening a High-Interest Checking Account
You want to have a lay of the land before you sign on the (digital) dotted line for a new bank account. Here are some key items you want to review before going with a high-interest checking account:
The APY
Minimum to open the account
Monthly maintenance fee
ATM fee
Minimum deposit requirement
Direct deposit requirement
Daily balance requirement
Number of debit card transactions you need to hit
Rates can change, so make sure you review your account offerings compared to others on the market from time to time to ensure you have the best setup for you.
How to Choose a High-Interest Checking Account
If you’re thinking about moving to a high-interest checking account, take a few things into consideration.
Look for accounts that won’t negate those interest earnings by charging you fees. However, if you carry a high balance, it may be worth paying a small monthly fee to get a better interest rate. Do the math.
Keep an eye on minimum balance requirements. We focused on accounts that don’t require a minimum balance, but if you know that you’ll consistently have at least $1,000 in your account at all times, you may want to shop around a bit more. There may be a great deal out there.
Look at the requirements. Maybe you don’t use your debit card that much or you don’t want to have a direct deposit. Choose an account that fits with the way you like to use your account.
Keep ATMs in mind if you use them. It’s 2022, and you shouldn’t have to pay those fees. There are too many banks that are willing to cover those for you.
Look for accounts with a mobile app. If you do a lot of banking on your phone, make sure the bank you choose has a solid banking app. Once you find the checking account that checks all the right boxes for you and how you like to use your account, sign up and start earning money on your money already.
Think outside the box. If your primary bank doesn’t offer a high-yield checking account (or the rates or monthly fees are a no-go), see what else is available. Consider all your options for opening a checking account — whether it’s a brick-and-mortar bank, credit union, digital-only service or other institution altogether, it quite literally pays to open an account with a bank that will reward you for having an account with them.
Frequently Asked Questions (FAQs) About High-Interest Checking Accounts
Here, we’ve answered popular questions about high-interest checking accounts.
ight now, Consumers Credit Union (a credit union) and Axos (an online-only financial institution) offer two of the highest APY rates on the market, at 2.09% and 1.00%, respectively. However, rates change all the time, so it’s essential to check every so often to see which places offer the best numbers. While digital-first organizations tend to offer the highest APY, regional banks and credit unions near you might also offer solid rates.
APY rates vary at different credit unions, banks and financial institutions (they can vary by location, too). Make sure an account meets other needs you may have instead of solely chasing a high APY. Take for instance, Axos Bank at 1.00% APY — it offers one of the highest rates on the market. But, you’ll need to match particular requirements to hit that number. If you can’t meet those qualifications the higher APY won’t matter much if you won’t reliably be able to earn it.
Many traditional brick-and-mortar and digital-only banks, financial institutions and credit unions offer high-interest checking accounts to members. Our list of the seven best high-interest checking accounts should get you started. Those financial institutions include Axos, Ally, Charles Schwab, Capital One, Consumers Credit Union, SoFi and NBKC.
This depends on a variety of factors. Let’s use an example: If you open a high-yield savings account with $1,000 at an estimated interest rate of 0.50% (that compounds annually) and don’t contribute one more dollar all year, you’ll end the next 12 months with $1,005.
you’ll end up with $1,305.97 in one year. Again, your results will depend on your own situation. You can always explore other finance products, such as savings accounts, money market accounts and CDs, if they offer more favorable terms for you.
How We Picked the 7 Best Checking Accounts That Pay Interest
Our methodology for this list is simple: According to the FDIC, the average interest rate for interest-bearing checking accounts is currently 0.03%. So, we looked for accounts that came in around that range or, ideally, were higher. (Note: APR fluctuates over time, so a lower rate now could rise in the future.)
Beyond the interest rate, we looked at what else the account brings to the table. We gave preference to ones that don’t have maintenance fees or require minimum balances and that offer ATM fee reimbursement.
Contributor Kathleen Garvin (@itskgarvin) is a personal finance writer based in St. Petersburg, Florida, and former editor and marketer at The Penny Hoarder. She owns a content-writing business and her work has appeared in U.S. News, Clark.com and Well Kept Wallet.
This was originally published on The Penny Hoarder, which helps millions of readers worldwide earn and save money by sharing unique job opportunities, personal stories, freebies and more. The Inc. 5000 ranked The Penny Hoarder as the fastest-growing private media company in the U.S. in 2017.