Cash Back Checking Accounts
Hearing the term “cash back” associated with a checking account may seem like a novel concept because 99 percent of the time, the term is directly tied with a credit card. However, some banks are using this rewards structure with checking accounts now as an outside-the-box way of rewarding their customers.
For almost a year now, all forms of traditional savings accounts have seen their interest rates sink to historically low levels and many banks and credit unions have been scrambling to find new ways to reward their account holders. Just last week we focused on the way in which checking accounts have been able to reward their new and existing customers with extra cash in our post, “The Top 10 Checking Account Promotions in 2010.” Today we’d like to reiterate the way in which a cash back checking account provides recurring cash rewards.
As the name suggests, cash back checking accounts provide you with cash back every time you spend. PerkStreet Financial recently went live with their online cash back checking account which provides a whopping 2% cash back on all purchases for the first 6 months, followed by 1% cash back thereafter. Unlike savings accounts, these accounts essentially reward you to spend, so if you are after a traditional CD (certificate of deposit) or high yield savings account, then this may not be ideal for your situation.
What Type of Consumer Would Benefit Most from a Cash Back Checking Account?
In short, someone who spends a good chunk of change every month. Given the PerkStreet Financial offer we mentioned above, one would be able to receive cash dividends of $50 per month if they were to spend $2,500/month from this account (2.0% X $2,500 = $50.00).
