Best High-Yield Checking Accounts Of January 2023

High-yield checking accounts are growing in popularity, as they combine the best aspects of high-yield savings, with the spending flexibility of checking accounts. In fact, some of the top high yield checking accounts on this list put some savings accounts to shame - but there are some limits.

Depending on what features matter to you (especially if you don't mind only having an online or app-based bank), these high yield checking accounts can be especially enticing.

We looked at banks, credit unions, and new app-based start-ups to find the best rewards checking accounts for you. But realize, many of these accounts have limits. In fact, most of these accounts "limit" the highest APY to low balance levels. They may also have requirements, like certain amounts of transactions or direct deposits each month. Make sure you check the fine print, and we break it down below.

The Best High-Yield Checking Account Options

Note: The checking offers that appear on this site are from companies from which The College Investor receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). The College Investor does not include all banking companies or all checking offers available in the marketplace.

How High-Yield Checking Works

High-yield checking is an interesting hybrid of checking, savings, and bank marketing. Yes, marketing. While each bank tailors their account slightly differently, these accounts are designed by nature to draw interest and attention. And as a result, many banks "write off" the "extra" interest as a marketing expense. That's why the balance allowed is usually pretty low.

For example, 1.00% interest on $10,000 is only $100 - so a bank may view an extra promotional rate of 1.00% APY as a marketing cost of $100 per customer. Not bad?

Furthermore, many banks combine high-yield checking with requirements, such as minimum balances, debit card transactions, and direct debit. These transactions typically bring revenue into banks (especially debit card transactions), so by requiring them, the banks are basically making money to pay you a higher rate.

If you're okay with these extra stipulations on your bank account, high-yield checking can be a great way to earn more interest on your money.

High-Yield Checking vs. Savings Accounts

At this point, you may be asking yourself why you should even consider a savings account? Why not just use one of these high-yield checking accounts instead?

Well, if you noticed in the list above, there are a lot of rules and restrictions. Depending on the person, it may simply not be worth the time or effort to try and meet the requirements in order to get the higher yield.

Plus, savings accounts typically have no requirements (other than sometimes a minimum balance requirement), and no upper limit. If you have a large cash balance (say $150,000) and you want to earn interest, you need to park that money in a savings account.

The best high yield savings accounts today pay solid interest rates on the full balance, with no requirements.

Common Questions

Still on the fence about high-yield checking accounts? I don't blame you! There's a lot to think about. Here are the most common questions we see.

What is a high-yield checking account?

A high-yield checking account is a checking account that pays interest - usually above average rates as well. These rates may be near, or even better, than what you get in a savings account. However, there are usually restrictions to qualify for the best rates.

How does a high-yield checking account work?

It works just like a traditional checking account, but in order to earn the top-tiers of interest, you typically must meet certain requirements. These requirements could include balance limits, monthly direct deposits, or even a required number of debit card purchases each month.

Do checking accounts pay interest?

Yes, some checking accounts pay interest. In fact, all of the accounts on this list are considered "high-yield", meaning they pay above-average interest.

Are there monthly fees for checking accounts?

While many checking accounts do charge monthly fees, we strongly recommend you avoid accounts that do. There are a lot of free checking account options that have great perks and rewards, including many high-interest options.

Are there any bonus offers for opening a checking account?

Yes! While offers vary, there are usually several accounts at any given time that offer bonus or promotional offers for opening an account.

Final Thoughts

Hopefully you better understand the concept of high-yield checking now. With that in mind, you know your options and you can know if it's right for you.

You might find other articles in our checking account comparisons helpful:

• Best Free Checking Accounts
  
• Best Nationwide Credit Unions
  
• Best College Student Checking Accounts
  
• Best Military Checking Accounts
  
• Best Starter Checking Accounts For Students And Kids
  

DISCLAIMERS

¹ 4.50% APY as of 1/11/23 and may change anytime. Interest is paid quarterly on the average daily balance up to a $5,000 balance.

² Active GO2bank account required to receive an eGift Card. eGift Card merchants subject to change.

³ Opt-in required. $15 fee may apply to each eligible purchase transaction that brings your account negative. Balance must be brought to at least $0 within 24 hours of authorization of the first transaction that overdraws your account to avoid the fee. Overdrafts paid at our discretion, and we do not guarantee that we will authorize and pay any transaction. See Deposit Account Agreement at GO2bank.com for more details.

⁴ APY—Annual Percentage Yield. Effective December 1, 2022 the interest rate will be 2.00%. These interest rates are variable and may change at our discretion at any time. No minimum balance required. Must have $0.01 in savings to earn interest.