Almost everyone now owns a bank account they use to send money, conduct PoS transactions and manage funds. What if you could earn a rate of return on your actively used money? This is how high-yield checking accounts work.
This contemporary banking service allows you to explore passive income without locking your money away. Let’s explore how they work and review the best high-earning checking account providers.
High-Yield Checking Accounts Explained
A checking account is the most common bank account where you deposit funds and use the available amount to pay, send and receive money. Yields refer to the rate of interest you realise from investing in various financial instruments.
High-yield checking accounts enable you to receive returns on the amount of money you have in your current bank account. You will continue using the same services, such as credit/debit cards, mobile banking, online transactions, and internal transfers.
Unlike traditional savings accounts, you will still be able to access your funds for payments and withdrawals without affecting your interest rate.
Traditional savings require depositing a set amount of money and not touching the account for a predetermined period, from months to years. However, high-interest checking accounts combine the best of the two worlds.
Benefits of High-Interest Checking Accounts
This service is experiencing high demand due to its convenience. Therefore, banks offer various incentives to attract many users. Some banks offer ATM fee reductions and cashback when paying using your yield-generating account or entering a bonus-based loyalty program.
The interest rate is determined by the issuing bank and your financial status. Long-term and loyal customers may receive better conditions and sometimes better terms than traditional savings accounts.
Some banks set criteria to keep the status running, such as maintaining a minimum balance, conducting a fixed number of transactions, etc. However, it is not uncommon to have a variable rate of interest, which changes based on economic conditions and changes.
The Best Interest-Bearing Checking Accounts Banks
Financial inventions get quickly spread across market players, and if you are looking for an interest-bearing checking account, you can find tens of providers. Here are the best providers and what they offer.
1. Ally Bank
A popular virtual bank with only online service mode. Ally Bank offers checking accounts, insurance packages, savings, loans and more. You can get competitive interest rates with relatively low fees on the bank’s various account types.
Ally Bank operates through a comprehensive network of ATMs with an interactive support portal to maximise convenience over digital banking.
2. Charles Schwab
One of the oldest investment banks in the US and the world, offering a combination of yield-bearing financial instruments and investments. Charles Schwab offers high-interest checking accounts at low recurring and withdrawal fees.
However, it does not accept cash deposits, and you may have to keep a minimum balance on your account to maintain your status, which might be inconvenient for some customers.
3. PNC Bank
The Provident National Corporation bank offers a combination of financial services, from financing to savings, mortgages, conventional loans and other services.
You can find plenty of income-generating products, including bank accounts with yields, which may be restricted in some regions or to selected users. However, you can enjoy various online banking tools with reasonable recurring fees and overdraft protection.
4. Axos Bank
Axos virtual bank offers various yield-bearing financial products, such as online banking, checking, loans and savings. The bank sets flexible requirements to qualify for interest rate checking accounts with low monthly charges.
With a massive ATM network and endless rebates on accounts, Axos Bank is highly convenient and affordable for your investment needs. It is a good choice for those wanting an online-only service.
5. SoFi Bank N.A.
SoFi Bank is a FinTech enterprise that offers various digital banking services aligning with modern customer preferences and market trends. The bank’s services run only through its Apple and Android apps, powered with user-friendly layouts and interactive interfaces.
You can access a wide range of long-term and short-term financing services, savings accounts and checking accounts with high yields. SoFi N.A. Bank applies zero overdraft and maintenance fees, with an attractive rate of interest and ATM network coverage.
Conclusion
Getting a high-yield checking account is an excellent way to explore income-generating sources without compromising the convenience of spending and accessing your funds.
This feature allows you to earn interest on your money available in current accounts, with minimum requirements and restrictions. By using these accounts, you can qualify for additional privileges to boost your banking experience.
