NEW YORK, May 1, 2014 /PRNewswire/ -- Even in this era of persistently low interest rates, there are still financial institutions offering yields of 2% or more on federally-insured deposits that are completely liquid, according to a new Bankrate.com (RATE) report.
Bankrate.com recently surveyed 56 high-yield checking accounts offered by U.S. banks, thrifts and credit unions. The average annual percentage yield for these accounts is 1.57%, nearly twice the average five-year certificate of deposit yield (0.80%) and more than 26 times the average interest checking yield (0.06%). All of the high-yield checking accounts that Bankrate.com surveyed are federally insured by the FDIC or NCUA. And unlike a five-year CD, a high-yield checking account is completely liquid.
"Done correctly, savers can put a few hundred extra dollars in their pockets each year just by redeploying their emergency savings and using a high-yield checking account," said Greg McBride, CFA, chief financial analyst for Bankrate.com. "But when evaluating these accounts, savers need to look beyond the yield to determine which requirements and limitations work best for them."
All 56 high-yield checking accounts mandate electronic statements and many require direct deposit. Other typical requirements include a certain number of debit card transactions, online bill payments and/or automated withdrawals each month. The specific details vary by account. Meeting the requirements is very important because the average yield drops to 0.06% if the monthly mandates are not satisfied.
Even if the accountholder meets all of the requirements, the 1.57% average yield applies only to a certain limit, known as the balance cap. The most common balance cap is $25,000, but the highest-yielding accounts tend to have lower balance caps. None of the 15 highest-yielding accounts are available nationwide with a balance cap over $15,000.
Fifty percent of the high-yield checking accounts that Bankrate.com surveyed are available nationwide (including 12% that require a charity contribution, a family member's credit union membership or an in-branch signature).
Click here to view all 56 high-yield checking accounts:
About Bankrate, Inc.
Bankrate is a leading publisher, aggregator and distributor of personal finance content on the Internet. Bankrate provides consumers with proprietary, fully researched, comprehensive, independent and objective personal finance editorial content across multiple vertical categories including mortgages, deposits, insurance, credit cards, and other categories, such as retirement, automobile loans, and taxes. The Bankrate network includes Bankrate.com, our flagship website, and other owned and operated personal finance websites, including CreditCards.com, Interest.com, Bankaholic.com, Mortgage-calc.com, CreditCardGuide.com, Nationwide Card Services, InsuranceQuotes.com, CarInsuranceQuotes.com, InsureMe, Bankrate.com.cn, CreditCards.ca, NetQuote.com, and CD.com. Bankrate aggregates rate information from over 4,800 institutions on more than 300 financial products. With coverage of nearly 600 local markets in all 50 U.S. states, Bankrate generates over 172,000 distinct rate tables capturing on average over three million pieces of information daily. Bankrate develops and provides web services to over 80 co-branded websites with online partners, including some of the most trusted and frequently visited personal finance sites on the Internet such as Yahoo!, AOL, CNBC and Bloomberg. In addition, Bankrate licenses editorial content to over 500 newspapers on a daily basis including The Wall Street Journal, USA Today, The New York Times, The Los Angeles Times and The Boston Globe.
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