The Best Reward Checking Accounts in the Nation

In today's awful interest rate environment, the only deposit account where you can find yields of 4.00% is the reward checking account. Even long-term CDs don't have yields this high. However, there are not many 4.00% reward checking accounts. Rates and balance caps have been falling. As I described in my reward checking overview, reward checking accounts only offer high yields for balances up to a certain cap. For those with large savings, this cap is as important as the rate. Many consider a balance cap of $25,000 to be the minimum cap that makes the reward checking account worthwhile.

There are now only seven reward checking accounts in the nation that offer yields of at least 4.00% for balances of at least $25,000. We consider these to be the 4.00% club. Unfortunately, all of these are local or limited deals. Only people in certain areas of the country or work for a certain employer can qualify.

I review the best nationally available reward checking accounts in my weekly summary. There is one that offers 4.00% APY, but it only applies for balances up to $10,000. The reward checking account is from Consumers Credit Union, and the rate is guaranteed to 6/30/2012. The best nationally available yield for a $25,000 balance cap is 2.52% APY at ABCO Federal Credit Union.

I thought listing the remaining 4.00% club members would be interesting. I don't know how long any of these will remain on this list. Some have a long history so they have proven themselves not to be teaser rates. If the rates do fall, I would expect them to remain competitive as compared to other reward checking accounts.

In my list I describe the locations or groups which can qualify for the account. Banks and credit unions have often reduced the availability of these accounts. So make sure you contact the institution for the latest qualifications.

To find reward checking accounts available nationwide or in your state, please refer to our reward checking account table, and please refer to this post for details on how to use the rate table.

Rates, Balance Caps & Availability as of 12/14/2011

1. Erie General Electric FCU's HD Checking pays 4.07% APY on up to $25K. I first reported on this account in May 2008 when the yield was 5.00%. Membership is limited to those who live, work or worship in Erie or Crawford Counties in PA.
2. Liberty National Bank's SuperSmart Checking pays 4.01% APY on up to $25K. We first started to track this account in January 2010 when the yield was only 3.01%. The yield actually went up in June 2010, but that may be when the requirements increased. The 4.01% APY now requires 25 debit card purchases per month. In addition, to avoid a $8 monthly fee, 40 debit card purchases are required. Branches are located in central and northwest Ohio.
3. First Community National Bank's Real Life Checking pays 4.01% APY on up to $25K. This is a new one. We have just been tracking this since June 2011. Its monthly requirements are typical. However, if you don't meet these requirements, you are not only punished with a tiny yield, but also you are hit with a $2 service charge. Branches are located in Missouri southwest of St. Louis.
4. Coppermark Bank's Free High-Interest Checking pays 4.00% APY on up to $25K. I first reported on this in April 2009. The top rate hasn't changed since then. Its monthly requirement of 16 debit card purchases per month is a little tougher than most other reward checking accounts. Branches are located in the Oklahoma City and Dallas metro areas. According to a CSR, any resident of Texas or Oklahoma can open an account. However, a branch visit is required.
5. Communications FCU's Performance Checking pays 4.00% APY on up to $30K. I first reported on this in May 2008 when it was paying 5.25% APY on up to $50K. The credit union now makes it easy for anyone in Oklahoma and Kansas to qualify for membership (see post).
6. Southwest Airlines FCU's LUV Reward Checking pays 4.00% APY on up to $25K. Its yield has always been 4.00% since we began tracking it in January 2010. I was late on my first review of this account in June 2011 since not many people can qualify for membership. As you might expect, it's limited to Southwest Airline employees. There are some other employers in its field of membership, but there doesn't appear to be an easy way for most people to qualify. Unfortunately, being a Southwest Airline customer doesn't qualify.
7. Home Federal Bank's Smart Rewards Checking pays 4.00% APY on up to $25K. This is another new one. My first review of this account was in April 2011. The top yield has remained at 4.00%. The account must be opened in person. Branches are located in Shreveport, Louisiana.