Rewards checking accounts are a great way to earn you some interest or if you’re looking to earn a nice generous sign up bonus. However, a major downside is that they may carry some high monthly fees (around $20 or more), unless they keep a very high balance in their accounts at all times or meet other requirements.
Don’t worry though, you can still find a rewards checking account that has below average monthly fees and requirements! Below, we will go over how to qualify for these types of accounts and whether you want to or not.
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Rewards Checking basics
When you decide to sign up for a rewards checking account, they tend to offer excellent perks such as:
- One-time sign-up bonuses between $50 and $200
- High annual percentage yields (often 1% or higher)
- Reimbursements for ATM surcharges
- Airline miles
- Cash back
To earn the highest possible APYs on your rewards checking account, you must keep a certain balance. For example, some accounts will only give you a high rate if you keep your balance under $10,000. Be sure you know the requirements involved to waive monthly fees and get the best deal.
How To Qualify For Rewards Checking
Each rewards checking account will have different benefits and requirements to earn those benefits, but here are some of the general requirements you might expect:
- Making 10 to 15 debit card transactions each month
- Having at least one direct deposit or one ACH automatic withdrawal clear your account each month
- Using self-service options such as electronic statements, online banking, ATM deposits or online bill pay at least once each month
When you go looking for a rewards checking account, financial institutions might ask you to fulfill all of these requirements, a combination of them, or an entirely new set altogether. Another popular one you should be ready for is keeping a minimum balance, but again, it depends on the account. Make sure it is possible for you to meet those requirements on a regular basis.
Is a Rewards Checking Account Worth It?
If the account you’re going for is truly free, then there isn’t much downside to choosing an account that’ll offer you rewards too. Even if you don’t qualify for any of the additional perks, you will still have a free account.
There are issues if you find it hard to meet the monthly requirements to have the fees waived. For example, if you force yourself to meet the minimum number of debit card transactions, you might end up triggering an overdraft. If this happens, the interest you earn won’t be enough to make up for the fees and spending.
The biggest decider in choosing a rewards checking account are the rewards associated with the account. On top of choosing the one with the best rewards, you should choose the one that does more than just store your money.
With this in mind, make sure you read all of the terms and conditions so that you aren’t signing up for more than you bargain for. Check out our listings of the best Rewards Checking accounts that’ll offer you the best rates!