High Yield Reward Checking Accounts

If you’ve been reading the news lately, you’ve probably read about the latest “fad” in bank accounts – the high yield reward checking account. A high yield reward checking account is a basic checking account that, if you fulfill its requirements, offer an interest rate that makes high yield savings accounts look pathetic. Malvern Federal Savings Bank, an FDIC bank located in Chester County, Pennsylvania, now offers a Reward Plus Checking account that pays out 5.01% APY.

You read that right, 5.01% APY. Online banks like ING Direct, once leaders in interest rates, current have rates under 2.00% APY! Malvern FEderal is offering double that on a checking account, which usually offers more flexibility than an online bank’s saving’s account. In addition to the phenomenal rate, the account has no minimum balance and no monthly fee.

So what’s the catch? There are several requirements you have to fulfill, many of which are standard for these types of accounts:

• 10 debit card transactions at POS per statement cycle;
• One direct deposit or ACH debit per statement cycle;
• Access free online banking one per statement cycle.

If you satisfy those three, you earn 5.01% APY on savings up to $35,000 and then 1.01% on balance above that. If you fail to satisfy them, you earn 0.20% APY; which probably still beats your current bank’s rate!