Why Opening a Rewards Checking Account Is a Smart Move

Every month, every payday, you put money into your checking account -- but what has your checking account ever done for you? With rising prices and high interest rates, it seems like people are in the mood to get more value from their bank accounts -- checking accounts included. The best rewards checking accounts can help put more money in your pocket.

Choosing a rewards checking account can help you turn your everyday spending money into another source of extra cash back or other rewards -- like a rewards credit card, but with your debit card.

Let's look at a few of the best rewards checking accounts and see how they can improve your financial wellness.

How rewards checking accounts work

A few types of rewards checking accounts exist. Some of the best checking accounts pay interest, while others offer cash back or other rewards for your debit card spending. In the same way that you might choose a cash back rewards credit card to earn 1% or 2% cash back on everyday purchases, some checking accounts pay a similar amount of cash back for debit card spending.

Our Picks for the Best High-Yield Savings Accounts of 2024

Capital One 360 Performance Savings APY 4.25% Rate info See Capital One website for most up-to-date rates. Advertised Annual Percentage Yield (APY) is variable and accurate as of April 11, 2024. Rates are subject to change at any time before or after account opening. Min. to earn $0 Open Account for Capital One 360 Performance Savings Member FDIC.	APY 4.25% Rate info See Capital One website for most up-to-date rates. Advertised Annual Percentage Yield (APY) is variable and accurate as of April 11, 2024. Rates are subject to change at any time before or after account opening.	Min. to earn $0
American Express® High Yield Savings APY 4.25% Rate info 4.25% annual percentage yield as of June 26, 2024 Min. to earn $1 Open Account for American Express® High Yield Savings Member FDIC.	APY 4.25% Rate info 4.25% annual percentage yield as of June 26, 2024	Min. to earn $1
Citizens Access® Savings APY 4.50% Min. to earn $0.01 Open Account for Citizens Access® Savings Member FDIC.	APY 4.50%	Min. to earn $0.01

Here are a few examples of the best rewards checking accounts, and highlights of what you get with each:

High-interest checking accounts

Some checking accounts pay interest, like a savings account. The APYs on checking accounts are usually much lower -- the FDIC's latest data shows that the national average interest rate on an interest checking account is only 0.08%, vs. 0.45% for the average savings account. But if you want to earn interest on every dollar of your extra cash, an interest-bearing checking account could be a smart choice.

Here are a few of the best high-interest checking accounts:

• American Express Rewards Checking: 1.00% APY (terms apply)
• Quontic High Interest Checking: up to 1.10% APY (terms apply)
• Axos Bank Rewards Checking: 0.40% (up to 3.30%) APY (terms apply)
• Consumers Credit Union Rewards Checking: up to 5.00% APY (terms apply)

Not every high-interest checking account will pay its highest rate for every dollar of your cash. Some have limits and will only pay the highest rate for certain balance amounts; others require you to have multiple accounts open with the bank. But if you want to get more value from your checking account, earning interest could be a good way to start.

Cash back rewards checking accounts

Other checking accounts pay cash back rewards, like a credit card. What if you could earn 1% cash back (or more) on everyday purchases with your debit card -- but without an annual fee or the other costs and risks of running up a credit card balance?

Here are a few of the best checking accounts for cash back rewards:

• Discover® Cashback Debit: 1% cash back on up to $3,000 of purchases per month
• Quontic Cash Rewards Checking: 1% cash back on eligible debit card purchases; cash rewards of up to $50 per statement cycle
• Upgrade Rewards Checking Plus: up to 2% cash back on debit card purchases (terms apply)

Why you might want a rewards checking account

Here are two types of people who might want to open a rewards checking account:

1. You want to turn your everyday spending into cash back rewards -- but without the potential drawbacks of a credit card.
2. You want to earn interest on every dollar in your bank account, even if you're going to spend some of that money on monthly bills.

If you want more value from your banking relationship, you should consider a rewards checking account. Instead of letting the bank have your monthly deposits for free, make your checking account work harder for your money.

Bottom line

The best checking accounts can offer high yields of 1.00%-5.00% APY -- but terms apply; the highest yields on checking accounts might require you to open additional linked accounts or maintain certain balances. Other rewards checking accounts actually pay you cash back (around 1%-2%) for your everyday debit card spending. This can make rewards checking accounts competitive with some of the best cash back credit cards.