Choosing between a high-yield checking and high-yield savings account may come down to your account balance

High-yield bank accounts allow you to earn more interest than traditional bank accounts.

High-yield checking accounts often come with minimum balance or transaction requirements.
High-yield savings accounts offer a steady interest rate but provide limited access.
If you’d prefer to grow your money easily, a high-yield savings account may be easier to manage.
Read more stories from Personal Finance Insider.

The national rate for most bank accounts is pretty low right now. If you’re looking to earn more than the national average, your best bet will likely be through online banks and online banking platforms. 

Many online banks and banking platforms offer high-yield savings and high-yield checking accounts. These accounts earn a higher interest rate than most traditional bank accounts at brick-and-mortar banks.

While these accounts are easily distinguishable by the competitive interest rate,  you’ll want to pay attention to more than which interest rate is higher.

Here’s an overview of different high-yield banks accounts, so you can figure out which bank account will be better for you to manage.

High-yield checking vs. high-yield savings: At a glance

A high-yield checking account is a checking account that allows you to earn interest on your account if you maintain a certain balance. A high-yield savings account is a savings account that allows you to earn more than ten times the amount of interest that you could with a traditional savings account.

Nathaniel Moore, CFP®, and principal with Agape Planning Partners, says earning interest on your money is vital because of inflation.

“With inflation being as high as it is, we see too many people that have their money sitting in cash, and they’re not earning any interest on it at all. They’re effectively losing buying power every day because as the cost of bread goes up — if your dollar is worth the same — you can’t buy the bread tomorrow,” says Moore.

Even if people are comfortable with saving in cash, Moore recommends looking for opportunities to earn interest through saving or investing. 

One such way is through a high-yield bank account. Most online banks and banking platforms offer at least one type of high-yield option. The two most common are high-yield checking accounts and high-yield savings accounts.

Quick tip: Rates fluctuate over time. A bank or credit union might offer the highest rate right now, but it could change. As a result, you may not want to choose a bank account solely because it earns the highest interest rate.

What is a high-yield checking account?

A high yield checking account functions similarly to a regular checking account, but it acquires interest over time. You’ll usually have a debit card attached to the account to make purchases or withdraw money at an ATM. Your money will also be secure because your accounts are FDIC or NCUA insured.

To earn interest, you may need to meet specific requirements. For instance, some bank accounts only earn interest if you maintain a minimum balance or make enough transactions.

Pros and cons of high-yield checking accounts


Offers a higher APY than many traditional checking accounts

Usually requires you to maintain a high account balance to earn the higher APY

Easy access to deposits through debit cards or apps

Often requires you to keep a certain dollar amount in your account or make a certain number of transactions per month


Could earn no interest if you don’t manage your account

When should you open a high-yield checking account? 

Moore says high-yield checking accounts are practical if you maintain a high average balance regularly. 

“Let’s say, for example, I have an occupation, and I’m making $20,000 per month. I’m using it throughout the month to pay my bills, but maybe an entire half of that or more is still in there. The high-yield checking account would provide me with a few dollars a month of interest,” Moore stated.

Elly Stolnitz, a spokesperson of the banking platform Wealthfront, says people can distinguish different high-yield checking by looking for useful banking features related to money management.

“If you want the best of both worlds, you’ll want to look for an account that offers all the checking features you need — like allowing you to direct deposit your paycheck, pay bills and friends, make purchases with a debit card, and access your cash via a network of fee-free ATMs — plus the ability to earn interest on all of your cash,” says Stolnitz.

What is a high-yield savings account?

A high-yield savings account pays a higher interest rate than traditional savings accounts. Savings accounts are also FDIC or NCUA insured, so your money will be safe even if a bank shuts down. 

High-yield savings are tools for storing and saving money. As a result, they aren’t as easy to access as high-yield checking accounts. Most won’t come with a debit card, which means you might not be able to deposit cash. Instead, you’ll have to transfer money from another bank account.

Quick tip: High-yield bank accounts are not investment accounts. Stolnitz says high-yield savings make sense for short-term goals or emergency funds but are not ideal for long-term financial goals. Investing may be more suitable.

Pros and cons of high-yield savings accounts


Pays higher interest than with a traditional savings account

Could earn less interest with higher balances than you would with a high-yield checking account

Accounts tend to offer a solid rate, regardless of your account balance

Doesn’t offer a debit card

When should you open a high-yield savings account? 

Moore recommends high-yield savings accounts and a bank account from a nearby bank to balance out the perks of different institutions. 

“From a savings strategy, I encourage people to use the high-yield savings. The reason for that is you can’t just walk in and take the money out. You’re more disciplined to keep it there. And then, use a local checking account for your day-to-day checking,” says Moore.

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