Rewards Checking Account

My credit union offers a rewards checking account that is earning a reasonable rate. (Where reasonable rate = a higher rate than their high interest savings account)

I’m debating moving the contents of my savings account into there and then keeping track of the subaccounts (checking versus savings) in a spreadsheet to take advantage of the higher interest rate. I would earn about $18-25 more per month in interest with all of the funds in my checking account.

I don’t worry about the accounting perspective – I have a good system in place for that. I don’t worry about meeting the minimum number of debit transactions per month – I eat out for lunch most days, which covers that easily.

So then what do I worry about? I worry about having $25,000 sitting in my checking account and being more open to fraud than having $3,000-$5,000 in my checking account and $20,000 in my savings account.

Readers, do you use a rewards checking account? Did you have this same worry? How did you overcome it?

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3 thoughts on “Rewards Checking Account

  1. I used to use RCA’s at AmericaNetBank until early 2011. This is when the yields started dropping from 4% to like 2.5%, when regular high yield checking accounts were still at 1% with no hassles, the difference just wasn’t worth the hassle of transferring purchases from credit to debit.

    If rates go up substantially again compared to the regular accounts, I’ll reconsider their effectiveness for my purposes.

    I had no worries about fraud – there was a time when a rewards checking account was my main checking account. I had all paychecks and bills going in and out of there. I had kept a small balance at a big bank for local ATM’s..

    • I primarily use a debit card since my credit card limits are so low, making the rewards checking account amazing. I basically earn around $20 per month without doing anything I wouldn’t have otherwise done. And if I don’t meet the requirements, my checking account is still free for the month.

      My credit union is actually pretty awesome and refunds ATM fees, so long as I qualify for the dividend rewards :) That has been super useful while traveling or running out of cash at home.

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