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Compare interest-bearing checking accounts
Enjoy a small boost to your balance while making everyday transactions.
Most checking accounts give you easy access to your money, but earn you little-to-no interest. So, what do you do when you want to grow your hard-earned dollars without sacrificing accessibility? That’s where an interest-bearing checking account comes in. Check out our top five recommendations below.
Compare interest-bearing checking accounts
How does an interest-bearing checking account work?
An interest-bearing checking account allows you to earn interest on your balance but typically at a lower rate than you’ll find with a savings account. Because the rate’s lower, it won’t replace traditional or high-yield savings, but a little growth each month can’t hurt.
Read the fine print of your account’s terms and conditions for minimum deposits or balances required to trigger the interest rate.
How can I compare interest-bearing checking accounts?
First assess what your needs are, the type of transactions you tend to make and how often you deposit money in your account. High-yield checking accounts often come with low ongoing fees. To make sure you’re getting the best deal you’re eligible for, weigh the APR against ATM, debit and other transaction fees that can eat into your ability to earn interest.
Competitive features designed to keep more of your money away from fees and reward you for your loyalty include:
- No monthly fees. Look for ways to avoid advertised maintenance fees, including committing to regular direct deposits or autopay requirements.
- Low or no monthly deposits. Some accounts require a minimum monthly deposit to earn interest or avoid fees.
- No ATM fees. Competitive banks offer free out-of-network withdrawals and even reimburse you for fees you’re charged by third-party operators.
- No debit card fees. With so much competition, it’s easy to find a bank that allows full use of a debit card without a charge.
- Convenient banking. If you like banking on the go, look for a robust app that allows you to manage your balance from your phone. Find a network of brick-and-mortar branches if you prefer in-person support.
- Low minimum opening balance. Look beyond banks requiring minimums that are more than you have to save.
- Competitive interest rates. Get the most out of your APY by learning whether interest payouts align with your paychecks — you’ll want it calculated against your highest balance between constant withdrawals and deposits.
- Rewards and perks. Many banks entice customers with cash back, miles or other rewards with your debit card.
- No foreign transaction fees. Frequent travelers will appreciate straightforward spending overseas and on foreign websites.
What are the pros and cons of interest-bearing checking accounts?
Pros
- Interest on your balance. Earning money with little effort is a plus — especially when most checking accounts don’t offer it.
- Easy access to your money. Set aside the funds you need to pay regular bills and funnel anything that’s left to your long-term savings account.
- FDIC protection. Your balance of up to $250,000 is protected against the financial institution’s collapse or failure.
Cons
- Low interest rates. APYs are often lower than your typical savings options, so don’t expect to rely on these accounts for long-term savings.
- Minimums required. If you can’t maintain at least the minimum, you may end up paying an assortment of fees — or find you’re excluded from earning the interest you sign up for.
How we chose the best high-interest checking accounts
Most checking accounts are designed to separate your fluid cash from your long-term savings. But an interest-bearing checking account offers the best of both worlds because you earn interest without giving up that easy access.
When researching our top five list, we looked at checking accounts with the highest interest rates first. Then, we weeded through our options by looking at factors like monthly fees, minimum balance requirements and ATM networks until we found the top five accounts.
Bottom line
An interest-bearing checking account can earn you a little extra on your balance intended for regular payments. But it doesn’t replace a savings account for long-term savings.
To keep your nest egg safe, compare savings accounts to find the highest APY you’re eligible for.
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