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High Yield Checking and Money Market Accounts at Bank of Internet USA


Bank of Internet USA
Update 7/02/08: The checking accounts have changed. Please see this new post for more details.

Update 4/16/08: The rates have gone down. New rates include: 3.40% APY for the Senior Checking, 3.10% APY for the Boomer Checking, 3.05% APY for the Freedom Checking, and 3.46% APY for the Money Market Savings.

Bank of Internet USA has long been offering high yield checking accounts. I'm afraid I haven't been giving them much attention over the last year as other online banks came out with new higher yielding checking accounts. As the yields on those other checking accounts have been plummeting in the last several months, Bank of Internet has kept their checking rates constant, and now these rates are among the best. Of course, these rates could change at any time, and I hope this post doesn't jinx them.

For those who want high yields on their checking without the hassles of reward checking accounts, Bank of Internet checking accounts are a good option. The best rate is on the Senior Checking which is only for those 50 or older. Some of the perks include:
  • Yield of 3.75% APY on all balances as of 2/28/08
  • Minimum opening balance of $50
  • No monthly service charge, no minimum balance required
  • Free checks. Limit one box per order.
  • ATM fees reimbursed up to $8 per month
  • Free banking by mail using BofI postage paid envelopes
  • Unlimited Bill Payments at no charge

Almost as good is the Boomer Checking which is only for those 40 or older. It seems to have all the perks of the Senior checking except a lower yield (currently 3.45% APY on all balances).

For those under 40, Freedom Checking has a yield close to the Boomer Checking (currently 3.40% APY on all balances). The main downside is the $1K minimum balance required to avoid a monthly fee. Below are the features that are different than the Senior and Boomer Checking accounts:
  • $1,000 minimum balance to avoid a $4/month fee
  • Initial order of 50 checks provided free
  • ATM fees you pay reimbursed up to $7 per month

If you decide to open a BofI checking acocunt, please consider using this affiliate link. It'll take you to a BofI sign-up page like the above links, but I'll get a little credit for it.

Money Market Savings Account

Bank of Internet's Money Market Savings Account is also very competitive. Some of the best features include:
  • Yield of 3.90% APY on all balances as of 2/28/08
  • Minimum opening balance of $100
  • No monthly service charge, no minimum balance required
  • Limited check writing privileges (3 checks per month)
  • Free check printing -- BofI MMS pack
  • ATM Card available
  • Allows Uniform Transfers to Minors (UTMA) accounts

I've read about many people being very pleased with BofI's customer service and bill pay service. The only downside that I've read about is the lack of an ACH transfer service. You can't initate ACH transfers to and from accounts at your other banks.

I was looking back at my BofI posts, and I found one that I did in July 2006. The post referenced a San Diego news article which looked inside the bank's operation. BofI is one of the oldest pure-online banks. It's interesting to note that things haven't changed much since that post. The checking and money market rates are pretty much the same and they still don't offer ACH transfers.

Bank of Internet USA is FDIC insured. It has a rating of 3 out of 5 stars (performing) by based on 9/30/07 data.

Thanks to the readers who mentioned these checking and money market accounts in the comments.

  Tags: money market accounts, Bank of Internet USA, checking account, savings account

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Comment #1 by Anonymous posted on
I have a checking account at B of I,
it is not worth it.
Bill pay takes minimum of one week to
arrive at destination.
I paid myself to other bank and they
sent a check via USPS, then I waited
and waited almost two weeks for the funds to be available.
Without ACH, is like going back in time. I would not recommend this bank to anyone.

Comment #2 by Anonymous posted on
I've been extremely pleased with Bank of Internet and their Senior checking. Your're right, I hope this plug does not jinx it! You cannot ACH from their site, but you can push /pull money from other sites. I have my Penfed CC debited monthly from this account as well as others. If you need money, I can always go to an ATM or write myself a check to cash locally. One other great feature is that if you use Bill Pay, the money is NOT debited from your account until it is presented for payment, not when the check it written. I highly recommend them!

Comment #3 by Anonymous posted on
I have several CD'S at BOFI and they are great to work with. Sent them an e-mail question yesterday and receivrd a reply the same day. These CD'S start maturing in April so am thinking about cashing in [since CD rates are to low] and put money in Senior checking. I still don't like the ach thing but I guess you can't have everything. But they sure do have a good customer service dept.

Comment #4 by Anonymous posted on
I've had a Boomer checking acct at B of I for a few years now; IMO they're one of the best to work with. True, there is not ACH offered, but as another mentioned, you can use your external account to transfer money to the B of I account.

Since I will be 50 in April, I will have them switch over to the "old fogie" checking, or perhaps, I can get a MMA. That's not a bad rate.

What I do enjoy besides their great customer service is the rate without needing to do umpteen transactions, do this, do that along with the partridge in the pair tree.

Lots of positive thoughts about them.

Comment #5 by Anonymous posted on
I've been a BOI customer for a little over 4 years. I have both a checking (Senior, was Boomer until I hit 50) and a Money Market account.

I am an accountant and usually transfer funds (from Money Market to Checking) to cover checks I've written just when I drop the checks in the mail. The only problem I've had is that my base checking safety balance was a little to low once and since the transfers have to be entered by 6PM PST in order to be same day transaction, a local check to my handyman hit the account the same day the transfer hit my account (due to weekend also), and I incurred a bounced check fee, but the check was later "force paid" and the fee was reversed. But my account still registered a "NSF" hit in the account additional information area.

Another problem that I encountered recently was I sent a couple of deposits by mail (using their Bank by Mail service envelopes) and the deposits went MIA since early January. Had to go back to the check issuers and get a new check. I use to send many deposits each month by mail, but now only doing ACH credits generated from other bank accounts.

I do want to also say that during the recent San Diego fires (the Bank is located in San Diego--Del Mar), although the Bank staff could not get to the Bank, the President's extension was transferred to his personal cell phone and he actually answered the phone and was stamping deposits on his kitchen table with his wife, to get the day's mail processed. You just won't find this kind of dedication anywhere else in the universe.


Comment #6 by C. (anonymous) posted on
There's also Burbank Community FCU with an annual teacher's account that's 3.75% -- it was 4%. I think anyone can join. I don't think the rate is posted on their site. But you can call for verification. 818.238.2900.
Great bank, so far, we've been there for a few months, I think.

Comment #7 by Anonymous posted on
As of today, they seem to have consolidated their checking accounts into one High Interest Checking with the same features as their Senior Checking used to have except for free checks for life. This must be the best checking account I am aware of. They also have a money market account with 6 bps extra interest, with no minimum balance.

Comment #8 by Banking Guy (anonymous) posted on
Banking Guy
Yes, it looks like they made some major changes. One big change is that it appears that there's a $5,000 minimum balance to avoid a monthly fee. Seniors didn't have to worry about this previously. I'll have to do a new post on these accounts.