bank rates

Farewell To 4% Rates On Reward Checking

By the middle of next month not a single bank will be paying 4% on a nationally available high-yield checking account.

AmericaNet Bank and Evantage Bank are lowering their interest rates from 4.00% APY to 3.75% APY on Nov. 18, 2010.

By the middle of next month not a single bank will be paying 4% on a nationally available high-yield checking account.The two online banks owned by a long-time Oklahoma banking family will still lead our rankings of the best nationally available rates on high-yield or reward checking accounts.

Although First Clover Leaf Bank in Edwardsville, Ill., continues to pay 3.85% APY on balances up to $15,000, it began limiting new accounts to local customers last week.

AmericaNet and Evantage have already slashed the maximum balance earning that top rate from $25,000 to $10,000.

The next best, nationally available interest rates on high-yield checking accounts are:

3.33% APY: from Coulee Bank, based in LaCrosse, Wis., on balances up to $25,000.

3.26% APY: from HCSB, based in Plainview, Texas, on balances up to $25,000.

Eighteen months ago several banks paid 5.0% or more on nationally available rewards checking accounts.

But the returns on high-yield checking have eroded so much this fall that we have to wonder if savers who embraced these accounts will begin to decide they’re no longer worth the hassle.

These are not investments you can sign up for and forget. You usually must make 10 to 15 debit card purchases each month, and arrange at least one electronic bill payment or direct deposit.

Fail to do that, and your return can fall to as little as 0.05% APY for that month.

If you’re unfamiliar with how these accounts work, “The ABCs of High-Yield Checking Accounts” will explain all of the rules.

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Comments (2)
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2 Existing Comments
  1. Bradley said:
    on October 11th at 03:19 pm

    Why do banks suddenly limit new accounts to local people?

  2. Pete said:
    on October 12th at 12:31 pm

    There’s a local community bank where I live (Medina, OH) that offers a 3.5% checking interest rate. I believe it’s nationwide, the site is …the most you can earn that on is $25,000.