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The Best Checking Accounts, Online, High Yield, Rewards and Others

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Rates in this post may be out-of-date. For latest rates on high yield reward checking accounts, please refer to my High Yield Checking Deals Website.

We're starting to see several launches of online checking accounts. Recent launches include ING Direct's Electric Orange and ETrade's Max-Rate Checking. According to this CNBC article we should be seeing a new high yield checking account launched at HSBC Direct in the second quarter. I've also heard E-LOAN has plans for launching one this year.

These new checking accounts have competition. Several banks have had online checking accounts for some time now. These include Everbank, ebank, Presidential Bank and Bank of Internet. In the last year some major banks like WaMu and Citibank have started free checking accounts with many perks. These checking accounts have been required to open their high yield online savings accounts. Many small banks and credit unions around the country have started high yield reward checking accounts in which you can earn very high interest rates in return for maintaining a relationship. The relationship typically requires 10 or more debit card transactions per month, direct deposit and online account usage. Finally, brokerages like Fidelity and Vanguard have high yield money market funds that have many features of checking accounts.

In this post I'll list the best accounts from all of the above options. If you have other recommendations for high yield checking accounts or other alternatives, please leave a comment.

Nationally Available Checking Accounts

High Yield Reward Checking Accounts

  • For Latest Rates: Nationally Available Reward Checking Accounts
  • 4.50% APY at Presidential Bank. Over $25K earns 2.75%. $1.5K minimum to open. $1K balance to avoid fees. Requires Direct Deposit. Hard credit inquiry is done.
  • 4.03% APY at City National Bank. Requires debit card usage and Direct Deposit. $100 minimum to open, but no minimum after and no monthly fees. Automatic ATM refunds. Free checks.

High Yield Checking Accounts Without Relationship Requirements
  • 5.10% APY at Salem Five Direct. Tiered rates from 5% to 5.30%. No minimum balance requirements or monthly fees. ATM refunds. (post)
  • 5.00% APY at ebank. May be a teaser rate. $2.5K to avoid fees. Free checks. ATM refunds. Hard credit inquiry is done (post)
  • 4.25% APY at Charles Schwab. No minimum balance requirements or monthly fees. Free checks. ATM refunds (post)
  • 4.00% APY (5.25% for over $50K) at ING Direct. No minimum balance requirements or monthly fees. No paper check books (post).
  • 4.00% APY at UnivestDirect. Like ING's checking but with paper checks (post)
  • 3.41% APY for under $10K at Everbank. Tier rates. 6% APY 3-month promo. ATM rebates. $1.5K minimum to avoid fees only required for online BillPay. Hard credit inquiry is done (post)
  • 3.40% APY for under $25K at Bank of Internet. $1K minimum to avoid monthly fees. ATM fee reimbursements. 3.75% APY for Senior Checking with no minimum balance requirements.
  • 2.50% APY at HSBC Direct. No minimum or monthly fees. No paper checks. ATM refunds (post)

Free But No Interest Checking Accounts Linked with High Yield Savings Accounts

Local High Yield Reward Checking Accounts

For Latest Rates: Reward Checking Accounts by State

Most of these rewards checking account are similar to what City National Bank offers, but they're intended for people in the local areas. Most require a branch visit to open the account. Like City National Bank, they typically require 10 or more debit card transactions per month, Direct Deposit and online account access. Note, I've added a note "open to all?" on some of these which I've received some confirmation that no branch visit is required and they allow out-of-state customers. Since these are small banks, this might not last. You can also see my latest reward checking account posts on this page.
  • 5.61% in Alabama, Tennessee and Mississippi at Citizens Bank (post)
  • 6.01% in Arkansas at Parkway Bank (post)
  • 6.01% in Arkansas at Bank of Little Rock (post)
  • 6.15% in Arkansas at First National Bank (post)
  • 6.01% in Colorado at 1st SouthWest Bank (post)
  • 6.01% in Florida at Premier Bank (post)
  • 5.64% in Florida at First Commercial Bank (post)
  • 6.01% in Illinois at Valley Community (post)
  • 5.50% in Illinois at Bank of Illinois (post)
  • 6.01% in Iowa at State Bank of Toledo (post) open to all?
  • 5.51% in Kansas at Bank of Blue Valley (post)
  • 6.01% in Kansas at Emprise Bank (post)
  • 6.01% in Kansas at Vision Bank (post)
  • 5.60% in Kansas at First National Bank (post) open to all?
  • 6.01% in Kansas/Missouri at Equity Bank (post)
  • 6.01% in Massachusetts at Florence Savings Bank (post)
  • 6.01% in Massachusetts at Danvers Bank (post)
  • 6.01% in Massachusetts at Slades Bank (post)
  • 6.17% in Missouri at RCSBank (post)
  • 6.01% in Missouri at Champion Bank (post)
  • 6.10% in Nevada at Clearstar Financial Credit Union (post)
  • 6.01% in New York at Northern Financial CU (post)
  • 5.01% in North Carolina at Capital Bank (post)
  • 5.00% in Oklahoma at Legacy Bank (post)
  • 6.01% in Oregon at Oregon Community Credit Union (post)
  • 6.10% in Oregon at Rivermark Community CU (post)
  • 6.25% in Tennessee at Wilson Bank and Trust (post)
  • 6.17% in Tennessee at FirstBank (post)
  • 6.01% in Texas at United Heritage Credit Union (post)
  • 4.75% in Texas at First National Bank (post)
  • 5.00% in Texas at Capital One - no hoops but 1yr promo (post)
  • 7.50% in Washington State at BECU (post)
  • 6.00% in Washington State a TwinStar CU (post)
  • 6.01% in Wisconsin at Connexus Credit Union (post)
  • 6.01% in Wisconsin at West Bend Savings Bank (post)
  • 5.01% in Wisconsin and Illinois at Blackhawk Bank (post)

Other Checking Accounts and Other Alternatives

USAA Checking has free checks, ATM reimbursements, no monthly fees, and a fast ACH transfer system. USAA Asset Management Account can also be used as a checking account and has similar perks, but it has the advantage of a high yield. You must be affiliated with the military or live in Bexar County Texas to be eligible to join.

Bank money market accounts often have check writing and ATM/debit cards. However, the check writing is limited to 3 checks per month by law. MMAs often have minimum balance requirements higher than savings accounts and checking accounts. Three of the best high yield money market accounts with check writing includes Zion Bank's Deseret Money Market Account (see post), Capital One's Money Market (see post) and GMAC Money Market Savings Account (see post). You can also get a high yield money market account through a Bank of America affinity account (see post).

Money market funds held in brokerage accounts can be used as a high yield checking account. Unlike bank money market accounts, they typically don't have a 3-check-per-month limitation. However, there's often a requirement that checks be over a certain amount (i.e. $250 for Vanguard and $500 for Fidelity). They're not FDIC insured, but are generally considered very safe. Fidelity money market funds and Vanguard money market funds both have yields above 5%. USAA's Asset Management Account would fall into this category.

[Update 7/04/07: Added several new local reward checking accounts.]
[Update 6/02/07: Added HSBC Direct's OPA and reward chk for UHCU and Bank of Illinois]
[Update 5/22/07: Added Salem Five Direct.]
[Update 5/19/07: Added several rewards checking accounts.]
[Update 5/06/07: Updated ING's mid-tier rate. Added UnivestDirect.]
[Update 4/28/07: Added Charles Schwab's new checking account. Updated BofI's Senior rate.]
[Update 4/18/07: Added several rewards checking accounts.]
[Update 4/2/07: Added Equity Bank's reward checking account.]
  Tags: checking account, savings account, reward checking account

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Comments
48 comments.
Comment #1 by SVG (anonymous) posted on
SVG
Banking Guy,

>>They're not FDIC insured, but are generally considered very safe. Fidelity money market funds and Vanguard money market funds both have yields above 5%. USAA's Asset Management Account would fall into this category.<<

Actually there is a work-around as I explained earlier. If the user selects 'USAA Federal Savings Bank Money Market-FDIC Insured' as the default for USAA AMA then the offering of USAA does not fall into the category of Fido/Vanguard uninsured money market. Then the full benefits of FDIC insurance become available. (At the last check the APY was 5.12%.)

- SVG

1
Comment #2 by dana (anonymous) posted on
dana
I found this one earlier today, as I've been searching for a decent checking that doesn't make you jump thru hoops for the interest. Univest Direct (www.univestdirect.com). 4%, online only acct, $1.00 to open, auto overdraft protection, etc. Bankrate rating--3 star.

1
Comment #3 by ProfessorB (anonymous) posted on
ProfessorB
You typed a great summary.

One more thing to include...ATM rebates. They are important to mention for online bank accounts that offer ATM cards.

1
Comment #4 by Anonymous posted on
Anonymous
Are there any that give prepaid envelopes for deposit by mail. I am still continuing with Netbank for that one feature. Saves me the trouble of making a trip to the bank for the small checks I need to deposit every once in a while. Netbank used to be competetive when they first started few years ago but have failed to keep up. Of course I dont have much of a balance there.

1
Comment #5 by Jeremy (anonymous) posted on
Jeremy
EverBank has business reply (guessing that's what you meant by prepaid?) deposit envelopes. If you're eligible though, USAA goes a step further and allows you to just scan in your checks for deposit.

1
Comment #6 by Anonymous posted on
Anonymous
With debit cards and automated payments, I anm suprised anyone uses checks anymore. For most people, the 3-6 Money Market checks ought to be plenty. UFBDirect offers check writing MM for 5% and 50k balance. And no crazy requirements like Twinstar has.
- sfchris, "Hi Scott"

1
Comment #7 by scott (anonymous) posted on
scott
Even better is Capitol One Costco MM. $100 min get's you 5.20%, They give you free checks and can write 3 a month. Good for paying big bills like your cards and get the float.
Scott "Hi sfchris"

1
Comment #8 by Brian (anonymous) posted on
Brian
eBank also gives mail-in envelopes and atm rebates. UFB Direct does as well (both), although it falls into the "no interest with linked savings" catagory. Has free overdrafts from savings, though.

I see no reason to use Netbank at all - UFB offers nearly the same features, better customer service, and much better rates. I'm using eBank right now, we'll see how long their 5% promo lasts. They have all the things I look for in a checking account:
1) checkfree billpay
2) high rate
3) ATM rebates
4) prepaid mail in deposits
and maybe 5) free checks (although this isn't really a big deal at all).

I still have my payroll direct deposited into Presidential just for when eBank drops this promo, but they don't offer ATM rebates, prepaid mail in deposits or free checks.

Fidelity is a good choice too since they let you buy the MMF the same day you ACH funds. Since I don't get any holds by BOA, I'll make deposits there and do an ACH and MMF buy at Fidelity same day.

1
Comment #9 by Anonymous posted on
Anonymous
BG -- Thanks for the very nice write-up.

1
Comment #10 by Anonymous posted on
Anonymous
.(sorry if this has been posted ) ...
Everbank.com ( FreeNet® Checking ) offers 6.01% (1st $100k) for 90 days after account opening.

They do take a while to snail-mail all the on-line credentials.

Since HSBCDirect's 6.00% offer ends 04/30 , this might be a good parking place for the $100K for another 3 mos. until the Next-Best-Thing pops up.

note: don't get confused like I did and open a "Yield Pledge MMA"; it only pays 6% on 1st $50k.

1
Comment #11 by David (anonymous) posted on
David
You can earn a good yield on your PayPal balance (currently 5.05% and it's not a teaser but rather automatically goes up and down with the market) by signing up for their Money Market [Mutual] *Fund*. From the PayPal side you can pull and push money from and to a regular bank account via ACH. It is not FDIC insured but this type of account is considered pretty darn safe from what I understand. Unlike a typical bank savings or money market [deposit] *account*, there is no limit on number of withdrawals. It's strange to think of PayPal as a savings or liquid investment vehicle, but here it is. I've been using it this way for a number of months with a very modest balance.

http://www.paypal.com/cgi-bin/webscr?cmd=_upgrade-interest-marcom&outside=1

- David Rosen

1
Comment #12 by Banking Guy (anonymous) posted on
Banking Guy
Thanks David. I should have mentioned PayPal's MMF in my alternatives section where I list Fidelity and Vanguard MMFs. It does have some nice features.

1
Comment #13 by metrocard (anonymous) posted on
metrocard
Here's another rewards checking account from Harborstone Credit Union.

1
Comment #14 by Brian (anonymous) posted on
Brian
The USAA AMA can be opened without a military relationship. Just call them and ask them to make you a brokerage-only member number. You won't get the ability to scan checks, but you still get the free checks, free atm rebates, and mail-in deposit envelopes (you have to send them a message to get these). On my last statement the FDIC insured sweep paid ~5.12%.

1
Comment #15 by Anonymous posted on
Anonymous
Hmmmm.... I can't find RateEdge.com anymore in your lists. Are you still listing it?

Thank you.

1
Comment #16 by Banking Guy (anonymous) posted on
Banking Guy
I'm only listing accounts in this post that have check writing. I think RateEdge is only a savings account with no check writing.

I do still include RateEdge in my weekly summary for the best local checking and savings accounts:

my weekly list

1
Comment #17 by Anonymous posted on
Anonymous
I like the idea of City National Bank's account because I know I make 10 debit card trans every month. I like SalemFiveDirect's interest, free first order of checks, and ATM refunds. Anyone tried City National Bank?

1
Comment #18 by Anonymous posted on
Anonymous
Could someone explain about the money market account restrictions (6 total, 3 check etc)? ACH pulls and pushes can be to other financial institutions, to pay state/federal taxes, credit cards, utilities... Are any of these included in the 3 limit? Do different banks interpret this differently?

1
Comment #19 by Banking Guy (anonymous) posted on
Banking Guy
Regulation D is the law that has the withdrawal limitation on bank savings and money market accounts. Here's the wording:

The depositor is permitted or authorized to make up to six transfers or withdrawals per month or statement cycle of at least four weeks. The depository institution may authorize up to three of these six transfers to be made by check, draft, debit card, or similar order drawn by the depositor and payable to third parties.

Most banks interpet this as a maximum of 3 checks and a total of 6 withdrawals that can include checks or ACH outbound transfers (i.e. pull from another bank account, payment of credit card, etc.) ATM withdrawals are excluded.

I've heard of some banks that limit ACH withdrawals to 3.

1
Comment #20 by Anonymous posted on
Anonymous
Why do you have eBank (that requires $2.5K to avoid fees) and Bank of Internet (that requires $1K to avoid fees), among others, listed under "High Yield Checking Accounts Without Relationship Requirements"?

I'm guessing because the requirements to avoid fees you see as different from requirements to achieve the advertised rate?

Perhaps it would be useful to separate into different lists, perhaps "High Yield Checking Accounts Without Relationship or Balance Requirements" for the ones like Salem Direct that don't have any requirements for either rate or monthly fees?

Thanks for all your reporting on these deals; a lot of us appreciate it.

1
Comment #21 by Banking Guy (anonymous) posted on
Banking Guy
By relationships I mean requiring direct deposit, debit card usage, etc.

A new list of no-min/no-fee checking accounts does make sense now that we're getting quite a few of them.

1
Comment #22 by Anonymous posted on
Anonymous
For a 4% interest checking account (up to $10,000) there is PC Banker:
http://pcbanker.com/personal/deposit/checking.asp

1
Comment #23 by Mario (anonymous) posted on
Mario
Bankdeals guy,

you might be interested in this bank consulting firm memo from a Houston based firm:

http://www.strunklp.com/images/customers/128274/docs/REWARD%20CHECKING%202B.PDF

Might explain why we have so many local reward checking accounts popping up right here in Texas. ;)

1
Comment #24 by Banking Guy (anonymous) posted on
Banking Guy
Thanks for the link is another vendor of these reward checking accounts. They provide similar marketing.

1
Comment #25 by Anonymous posted on
Anonymous
What about Beneficiary accounts? Does anyone know of an online high yield account for these? I'm the rep payee for my mentally handicapped son's account. It's titled in my name but FOR him. He carry's a balance of a few thou that is earning next to nothing now and so far I've had no luck. I need to have access to the funds so CD's at my local bank are no good. I appreciate any advice~

1
Comment #26 by Banking Guy (anonymous) posted on
Banking Guy
Everbank allows payable-on-death (POD) beneficiaries. In addition they allow custodial accounts (see post). If you prefer higher interest over unlimited check writing, you may want to consider their money market account which has a standard 5.01% APY.

If you don't need unlimited check writing and only need PODs, GMAC allows PODs to be set up for its Money Market Savings Account. I set up a POD on my GMAC account after the application. I sent them a request from their secure email, and they added my family member as a POD.

1
Comment #27 by Anonymous posted on
Anonymous
I'm looking for a decent checking account that also offers decent overdraft protection (either by way of an unsecured line of credit, or by drafting from a credit card). Got any info about that?

1
Comment #28 by Banking Guy (anonymous) posted on
Banking Guy
ING Direct's Electric Orange doesn't charge any overdraft fees, just interest (see their Overdraft FAQ).

1
Comment #29 by Anonymous posted on
Anonymous
Hey thanks for this great blog. I'm wondering if anyone knows of a high yield, atm rebate account with no minimums that allows you to have an ATM-only card as opposed to a Visa Check card (which is insecure in my oppinion) and doesn't charge a percentage for overseas transactions.

1
Comment #30 by Anonymous posted on
Anonymous
I got hard credit pulls from ING Direct, Salem Five, and AmtrustBank after starting applications to open these accounts. I never even completed the ING application, but still got the credit inquiry. I wish I had known that opening these accounts would hurt my credit scores.

1
Comment #31 by Anonymous posted on
Anonymous
Thanks for the post; it was a big help in my research for a new checking account after the NetBank failure. I have decided on Bank of Internet, USA. With BOI, you can avoid minimum balance requirements by opting for their Boomer Checking Account (40+ years), or Senior Checking Account (50+ years). (Banking Guy's original post only mentions the Senior option.) Other than Salem 5 Direct, these are the only checking accounts I am aware of that offer paper check writing, high interest, free bill pay, and no minimum balance without any other relationship requirements. And unlike Salem, they do not have a six dollar a month fee for using Quicken. (Though I understand that Bank of Internet's Quicken access is somewhat primitive).

1
Comment #32 by Anonymous posted on
Anonymous
Advantis Credit Union in Oregon has Fusion Checking that gives 6.25%.
www.fusionchecking.com

1
Comment #33 by Anonymous posted on
Anonymous
You should update the rates in this post.

1
Comment #34 by Banking Guy (anonymous) posted on
Banking Guy
Yes, it's a few months out-of-date. An update is scheduled for next week.

1
Comment #35 by Anonymous posted on
Anonymous
No high yield allowed if you have a family trust.

1
Comment #36 by Anonymous posted on
Anonymous
For some reason no debit cards allowed with family trust, therefore you can not open a high yield checking acct. with a family trust attachment. Per Eastern Financial FL C. U.

1
Comment #38 by koz22 (anonymous) posted on
koz22
Coulee Bank offers Rewards Checking at 5.01% APY. Offered nationwide and it's FREE! Apply at www.CouleeBank.net.

1
Comment #39 by koz22 (anonymous) posted on
koz22
Also, Coulee Bank offers up to $20 in ATM fee refunds per month. Another great perk!

1
Comment #41 by Anonymous posted on
Anonymous
I’m getting really competitive rates with a product called easyGROW Checking at First Bank & Trust. You can go to www.easyGROWchecking.com for the info (including the current interest rate); but to summarize, it is a free high-yield account that also offers ATM fee refunds when I meet the three qualifications: using my debit card at least ten times, receiving e-Statements, and having a least one direct deposit or automatic payment each cycle. I do all of those things anyway, so it’s been really easy for me to qualify…and they send me an email each month to let me know if I met the qualifications. I have to admit, I love not having to worry about whether or not an ATM is on my network, and the interest is already starting to add up. It only takes $100 deposit to open the account, and there is no minimum balance.

1