Best High Interest Banking Accounts (With Bill Pay): (Checking/Savings/MMA?)

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Mr Chill
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Best High Interest Banking Accounts (With Bill Pay): (Checking/Savings/MMA?)

Post by Mr Chill » Tue Jan 16, 2018 4:23 am

I help my parents manage their finances and the bulk of their wealth is tied up in annuities. Nonetheless, I try to keep between $10-20k in reserve in their checking/savings accounts at Bank of America. They've done business there forever, but the interest rates are absolutely pathetic, not to mention they want to charge $3 per outbound ACH, and other onerous fees.

I had them open up a Synchrony Saving account, now getting 1.45% APY. Not the best, but better than with BOFA. Still, there's no bill pay option, so it requires more transfers to save the money, then send it to an external checking account, then wait for the funds to clear, then pay the bills.

In the $20k and under bracket, is there a great interest rate that could be found solely in a checking account (possibly paired with a savings account if the saving had better interest), all at the same institution?

Here's a list of pretty high APY's I've found: http://www.magnifymoney.com/blog/earnin ... 376922578/

The trouble with most of the ones listed there is that they require a lot of debit card purchases, which my folks don't really normally do a whole lot of. I guess I could spend a few bucks here and there throughout the month on the debit card, but it would be nice not to go through the hassle.

Here's BCU: https://www.bcu.org/Products/Banking/Ch ... C08CADB388

So far, the best thing I've found is BCU offers $25k balances 2% APY, providing you do 15 bill pay/ach/debit transactions. That is very doable. Is there any other outfit that offers similar or better? What are you folks using as your primary checking/savings/bill pay accounts and why?

Thanks as always for the pointers!

bulbul
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Re: Best High Interest Banking Accounts (With Bill Pay): (Checking/Savings/MMA?)

Post by bulbul » Tue Jan 16, 2018 5:39 am

I am using Discover online saving and Discover cashback checking. The online saving yield is 1.30% now. For the cashback checking, earn 1% cash back on up to $3,000 in debit card purchases each month.

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oneleaf
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Re: Best High Interest Banking Accounts (With Bill Pay): (Checking/Savings/MMA?)

Post by oneleaf » Tue Jan 16, 2018 1:38 pm

Alliant CU has a pretty good checking/savings pairing:

Checking has .65% interest (as long as you have SOMETHING direct deposited every month. It can be SS payments or paycheck).
Savings has 1.3% interest

You can set up overdraft protection in checking with savings as a backup source.

Ally and CapitalOne 360 have similar offerings. Savings rates are about the same (1.25% to 1.4%) and the checking has interest depending on the balance (from .2% to 1%). Personally, I find Alliant CU to be the best.

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birdog
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Re: Best High Interest Banking Accounts (With Bill Pay): (Checking/Savings/MMA?)

Post by birdog » Tue Jan 16, 2018 1:47 pm

+1 for Alliant. I researched all available options last spring and chose Alliant.

TOJ
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Re: Best High Interest Banking Accounts (With Bill Pay): (Checking/Savings/MMA?)

Post by TOJ » Tue Jan 16, 2018 1:53 pm

I recommend taking a look at a Fidelity Cash Management Account. It's effectively a checking account with regard to direct deposit, billpay, and chekc writing. The secret sauce is that you can invest within the account. E.g., you can put together an automatic CD ladder right within the account. Or hold short term treasuries. They refund ATM fees so you can use any ATM you want, if needed. I don't recall the interest rate on cash within the account. It's not good.

onourway
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Re: Best High Interest Banking Accounts (With Bill Pay): (Checking/Savings/MMA?)

Post by onourway » Tue Jan 16, 2018 1:54 pm

I really like Schwab for their checking account. Completely free - no charges for anything that I've run across yet. Free checks. Free ATM withdrawals worldwide. Good bill pay interface. Great customer service.

Their checking and savings accounts don't have great interest rates, but you could put the money in a money market fund via the brokerage account associated with the checking account. These are at like 1.2% or so these days, so fairly competitive with other savings accounts - and on a balance of $20k or so you're only talking tens of dollars of difference here. Choose a short-term bond fund if you want a bit more. Schwab makes the line between your checking and brokerage account very faint. You can even do bill pay directly from the brokerage.

patrick
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Re: Best High Interest Banking Accounts (With Bill Pay): (Checking/Savings/MMA?)

Post by patrick » Tue Jan 16, 2018 2:05 pm

Big list of high interest bank accounts: https://www.doctorofcredit.com/high-int ... gs-to-get/

If you are willing to meet requirements like those for the BCU account linked you can find various accounts with higher rates. For example, LMCU 3% on up to $15000 with a 10 transaction per month requirement. An Insight prepaid card pays 5% on $5000 and only requires avoiding inactivity. If you always keep $5000 on the Insight card, you'd have a 3.5% average interest rate if the combined balance is $20000, or a 4% average interest rate if your combined balance is $10000.

Be sure to pay close attention to the rules if you decide to use the higher interest accounts. For instance, the BCU account linked requires $500 a month in deposits in order to get the higher rate. LMCU is satisfied by only a $10 deposit but it has to be through ACH. You'll also need to watch out for changes as these kinds of accounts might change the rules -- for instance, Netspend reduced the limit on their 5% cards from $5000 all the way down to $1000 back in the middle of 2016.

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Hub
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Re: Best High Interest Banking Accounts (With Bill Pay): (Checking/Savings/MMA?)

Post by Hub » Tue Jan 16, 2018 2:56 pm

I've seen one at 3.51% on your 1st $30k, but requires 20 or 30 debit card transactions. Thanks for these suggestions that allow money to just sit.

ZinCO
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Re: Best High Interest Banking Accounts (With Bill Pay): (Checking/Savings/MMA?)

Post by ZinCO » Tue Jan 16, 2018 3:13 pm

TOJ wrote:
Tue Jan 16, 2018 1:53 pm
I recommend taking a look at a Fidelity Cash Management Account. It's effectively a checking account with regard to direct deposit, billpay, and chekc writing. The secret sauce is that you can invest within the account. E.g., you can put together an automatic CD ladder right within the account. Or hold short term treasuries. They refund ATM fees so you can use any ATM you want, if needed. I don't recall the interest rate on cash within the account. It's not good.
Interest rate on cash is NOT good, as you said, but you can keep cash in a money-market fund within the CMA account and use it as free overdraft protection (but you have to explicitly set that up). I have BoA as well but have moved substantially all of my bill pay and ATM access to Fidelity, with cash kept in FZEXX (Fidelity Tax-Exempt Money Market Premium), currently yielding 1.20% tax-free. Automatically moves money from that fund to cash to keep a cushion of $2k at all times, although I'm not really sure if there's a reason not to have a cushion of $0 since there is no overdraft fee.

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