Earning 5% on a checking account in not only amazing by also realistic. In today’s competitive banking industry banks are constantly looking for ways to entice people into giving them cash. One incredibly effective way to draw people in is to offer them awesome rates such as 4% -5% on new reward checking accounts.

Check around with your local community and state banks. You may have never heard their name before or may question their validity but they are most likely going to be FDIC insured so don’t worry. Most of these smaller banks offer the same great features as the larger banks with more of a personal experience.

It seems as if they all offer a similar deal on interest bearing checking accounts. You basically accept the fact that you have to create an online banking account and accept an online statement opposed to a paper statement in the mail. In addition you have to make somewhere around 10 debit card transactions and 1 ACH transfer or direct deposit per statement. Since most of us have direct deposit and perform more than 10 transactions per month there is really no major hoops that you have to jump through.

There are however two disadvantages of using an interest checking. First, is the fact that many small community and state banks want you to live in the state or county that their bank is located. You will find very few that will take on an account out of their area. The second disadvantage of using an interest checking accounts is the fact that if you do not meet the requirements each month you will not be paid the stated interest rate. They will usually pay you somewhere between .01% and 1%

An interest checking account form a community or state bank can be an excellent place to park your spare cash for emergency use. Check around your area to find the best rates. Before signing up take a quick look at your banks financials for signs of potential failure in the immediate future. Always go with a bank that is FDIC insured.

Author: John Zinsky

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