With the Fed raising interest rates recently, savers have been reaping substantive returns on their investments. High-yield savings accounts, money market accounts, and CDs are all paying much higher rates than they were just a few years ago. But now, some checking accounts are offering even more substantial returns on your everyday transactions. High-yield checking accounts are earning APYs (annual percentage yields) that can compete with many other saving options. In addition, high-yield checking accounts are a convenient way to create a passive income stream from everyday spending.
In addition to allowing you to earn a higher APY than standard checking accounts, some of these accounts also come with perks like one-time sign-up bonuses and ATM fee reimbursements. Other benefits may include cash back on purchases or airline miles. However, the High Interest Checking Account APYs that these types of accounts offer are not available to everyone. Many of the best high-yield checking accounts require you to meet specific transaction requirements, such as a minimum number of debit card purchases each month. These types of requirements may be difficult to maintain, especially if you’re not disciplined enough to avoid overspending in general.
You can open a high-yield checking account with most traditional banks and credit unions. However, online banks tend to be more lenient with these requirements and can offer better rates. You should check the fine print to make sure you understand what conditions are required to qualify for a high-yield checking account. It is important to keep in mind that even though these accounts provide higher APYs than regular checking accounts, you will still be paying taxes on any interest earned.
When choosing a high-yield checking account, you should always compare interest rates and APYs between different accounts to find the best one for your needs. Additionally, you should also look at the minimum balance requirements and any fees that could eat into your earnings. Finally, you should set up automatic deposits into your new account so that you’re not forgetting to deposit any money.
Generally, high-yield checking accounts are available from banks and credit unions that offer savings or money market accounts. They are also commonly offered by credit unions, which are not-for-profit financial institutions owned by members. Because of their low operating costs, they can often offer higher APYs on their checking accounts than larger banks can.
As the Fed has raised interest rates, more people are looking for ways to maximize their savings. Those who are disciplined enough to stick with a high-yield checking account will have the potential to see significant returns on their money over time. This type of account can supplement other forms of passive income, such as those from high-yield CDs or money market accounts. The key is to choose an account that meets your goals and suits your spending habits. With a little work, you can find a great checking account that will pay you high returns on the money you use daily or weekly.