Back when CD rates began to fall from grace around late 2008 and early 2009 (and ever since) rewards checking accounts have been highlighted as solid alternatives for those seeking high rates on FDIC insured investment vehicles. They operate similarly to money market accounts but require the consumer to make monthly purchases and direct deposits in order to receive the exceptional interest rate. Generally speaking, these requirements will be something like – 10 debit card transactions and 1 direct deposit, but may require more from the customer as well. You’ll also need to go paperless to earn the high APY which means receiving e-statements.
For most consumers, this means they’ll need to have this account operate as their main checking account, so it can be a rather large commitment to make if you’re already deeply entangled with your current financial institution.
While the APY’s are still more than twice that of a traditional money market or interest checking account, we’ve seen them drop sharply throughout the last quarter of 2011. In fact, just in November of 2011 we saw interest rates on these accounts at over twice the APY in which they currently sit!
Below are the highest yielding “Rewards Checking Accounts” still offered today:
1) Community Bank of Pleasant Hill is featuring a Rewards Checking Account yielding 2.01% APY on balances up to $25,000.
2) Community Bank of Raymore is featuring a Rewards Checking Account yielding 2.01% APY on balances up to $25,000.
3) Atlantic Coast Bank is featuring a “iKasasa Checking Account” yielding 2.01% APY on balances up to $15,000.
4) Connexus Credit Union is featuring a “Xtraordinary Checking Account” yielding 2.0% APY on balances up to $25,000.
5) Heritage Bank is featuring a “eCentive Account” yielding 1.71% APY on balances up to $25,000.