Updated May 2020. Consumers Credit Union (CCU) has a Free Rewards Checking account that offers a high interest rate between 2.09% and 4.09% APY if you meet certain requirements. As with similar accounts elsewhere, the catch is if you don’t jump through all of the hoops, you effectively won’t earn any interest at all that month (0.01% APY).

Membership
To open a Rewards Checking account, you must be a member. However, CCU has a very open membership policy; basically anyone nationwide can join if they do the following:

• Join the Consumers Cooperative Association with a one-time $5 fee.
• Open and maintain a share savings account with a minimum $5 deposit.

Earn 2.09% APY on up to $10,000 + ATM Fee Refunds if you:

• Make at least 12 debit card purchases each month. (Reduced to 6 during April and May 2020.) Don’t use your personal identification number [PIN]. In stores, select to run it as a “credit” purchase.
• Direct deposits, mobile check deposits, or ACH credits totaling $500 or more monthly.
• Receive e-Documents (enroll and accept the disclosure)

Earn 3.09% APY on up to $10,000 + ATM Fee Refunds if you:

• Complete all of the tier requirements above, plus
• Make $500 or more in CCU VISA Credit Card purchase transactions (no minimum number of transactions)

Earn 4.09% APY on up to $10,000 + ATM Fee Refunds if you:

• Complete all of the tier requirements above, plus
• Make $1,000 or more in CCU VISA Credit Card purchase transactions (no minimum number of transactions)

A nice feature is that their online interface has a progress tracker, updated daily, telling you number of debit card transaction and the total spend on your CCU credit card. Tracking is also available via their smartphone app (Apple/Android).

All tiers will also receive:

• Unlimited reimbursement for any and all ATM fees + 30,000 surcharge-free ATMs nationwide.
• No minimum balance. No monthly service fees.
• Free online Bill Pay.
• Mobile check deposit via smartphone app.

Qualifying Credit Cards
If you don’t have a CCU credit card, the best you can do is the 2.09% APY tier. Here is a list of their credit cards. It looks like the best one is their Visa Signature Rewards card, which offers a 3% cash rebate on up to $6,000 in “Grocery/Convenience Store” purchases annually, 2% cash rebate for “Gas” purchases, and 1% cash rebate for all other purchases. No annual fee.

Note that I would try to take advantage of the Grocery 3% and Gas 2% cash back categories in order to not miss out on the potential cash back from a 2% cash back card.

Cost/Benefit Analysis
Keep in mind that most checking accounts pay very little, leaving you to try maximizing your savings balance while avoid overdrafts. So you might not max out that savings account rate completely.

• $10,000 times 2.09% APY would be $209 per year, or $17.40 per month in interest.
• $10,000 times 3.09% APY would be $309 per year, or $25.75 per month in interest.
• $10,000 times 4.09% APY would be $409 per year, or $34.08 per month in interest.

An extra $100 to $300 a year in interest sounds pretty good. Note that to qualify for the top two tiers, you’d also have to apply for a new credit card, which would entail a credit check. There is an opportunity cost here, as there are other new credit cards that offer close to $500 in sign-up incentives within a few months. You can apply for multiple new credit cards, but once you reach a certain number it will hurt your chances for getting the next one.

These types of checking accounts are not for everyone. Not only do you have to jump through hoops each month to get a reward (higher interest than no-hassle account), if you don’t you’ll actually get punished in a way (lower interest than a no-hassle account). Try to create a reliable system where you satisfy the requirements early on in the month, for example putting some automatic insurance, phone, or utility bills on the credit card. My favorite feature is their qualification tracking; I wish all rewards checking accounts had this feature. CCU has been running this rewards checking account now for well over 10 years (with several tweaks), so hopefully they have crunched the numbers and set the rates at sustainable levels.

Bottom line. Consumers Credit Union (CCU) has a Free Rewards Checking account that offers a high interest rate if you meet certain requirements. This is a unique account, but CCU has been running it for nearly a decade now. It would work well if you want to one single high-interest checking account and your balance rarely exceeds $10,000.

Capital One 360 Savings has a limited-time sign-up bonus for up to $500 for new customers, tiered depending on your opening deposit. Here’s a quick recap of the features of 360 Savings accounts:

• No monthly fees or minimum balance requirements.
• No minimum deposit required to open an account.
• Free electronic fund transfers to a linked checking account.
• 24/7 online and mobile access, or talk to a real person 7 days a week 8AM-8PM.
• % APY as of 2/10/16

Bonus instructions.

1. You must open your first 360 Savings Account by the promotion expiration date, 11/30/2015 at 11:59 PM EST. (If you’ve had a Savings product with Capital One 360 or ING DIRECT before, you won’t be eligible for the bonus.)
2. To qualify for a bonus, your account must be funded within the first 10 days of account opening. Deposits from an existing Capital One 360 account will not qualify for the bonus.
3. The amount of your bonus will be determined based on the highest amount you deposit within the first 10 days of account opening and maintaining that balance on a daily basis for the next 90 days following the 10 day period. You must deposit a minimum of $5,000 and maintain a daily balance of $5,000 for 90 days after the initial 10 day period to qualify for any bonus. The amount of the bonus you actually earn will be determined based on the following balance tiers during the initial 10 day period and the 90 day period after that: $5,000+ earns a $50 bonus, $10,000+ earns a $100 bonus; $20,000+ earns a $200 bonus; $30,000+ earns a $300 bonus; $40,000+ earns a $400 bonus; and $50,000+ or more earns a $500 bonus. The maximum bonus you can earn is $500.

Essentially, if you deposit an amount exactly on the tier level, you will earn 1% of your deposit (i.e. $50 on $5,000 or $500 on $50,000) with a minimum holding period of 90 days following the 10-day deposit window. This is in addition to the existing interest rate.

For more details on the account interface and such, please check out my 360 Savings account review.

Disclosure: I will receive a referral if you open an account via one of the links above, as a paid endorsement. To my knowledge, this is also the best publicly-available 360 Savings bonus offer out there. I won’t be participating myself because I’ve had an account (ING Direct) since 2005. Please refer to my full advertising disclosure.

Our family keeps a year’s worth of expenses (not income) put aside in cash reserves; it provides financial insurance with the side benefits of lower stress and less concern about stock market gyrations. In my opinion, emergency funds can actually have a better return on investment than what you see on your bank statement.

I don’t chase rates nearly as much as I used to, but it still pays to shop around. Too many places are paying ZERO or close to it – the Megabanks, short-term US Treasuries, and money market sweep funds. Do you know what Chase offers on a 1-year CD? 0.02% APY. Bank of America on their 10-year CD? 0.15% APY. Meanwhile, the rates below vary from 1% up to over 3% annualized.

Best Currently Available Interest Rates
Here is a brief roundup of the best interest rates available on deposits backed by the full faith and credit of the US government (FDIC-insured, NCUA-insured, US Treasury Bonds, US Savings Bonds). I will try to sort them from the shortest to longest maturities.

High-yield savings accounts
• It seems every bank has their own online savings account, with the best accounts with long-term competitive rates earning around 1% APY. These savings accounts can change their interest rate at any time, so if you’re going to just pick the highest one, be ready to move your money.

Short-term guaranteed rates (under 1 year)
• Everbank Yield Pledge Money Market and Interest Checking account both offer 1.60% APY guaranteed (balances up to $150k on the Money Market) for the first 6 months for new accounts. Since it is fixed, this is essentially a 6-month CD with a higher rate than any other 6-month CD rate out there and with no early withdrawal penalty to worry about.

Flexible Savings Bonds
• “Series I” US Savings Bonds offer rates that are linked to inflation. Unfortunately, “I Bonds” bought right now will earn nothing for the first six months, and then a variable rate based on ongoing inflation after that. For new money, I would wait until mid-October when the next rate adjustment is announced. More info here.

Rewards checking accounts
• These unique checking accounts pay above-average interest rates, but with some risk. You have to jump through certain hoops, and if you make a mistake you won’t earn any interest for that month. Rates can also drop quickly, leaving a “bait-and-switch” feeling. But the rates can be high while they last. Consumers Credit Union offers up to 5.09% APY on up to a $20k balance, although 3.09% APY is easier to achieve unless you satisfy a long list of requirements. I list this one because the rate is guaranteed until December 31, 2015.

Certificates of deposit
• If you have a large cushion, it’s quite likely to just sit there for years. Why not put some money in longer-term investments where you can still take it out in a true emergency and pay an early withdrawal penalty. Synchrony Bank (formerly GE Capital Retail Bank) is offering a 5-year CD paying 2.25% APY $25k+ balances (2.20% APY for $2k+) with an early withdrawal penalty of 180 days interest. For example, if you withdraw from this CD after 2 years and pay the penalty, your effective rate earned will still be 1.69%. Capital One 360 also has a similar 5-year CD.
• Other notable CDs… USAlliance FCU has a limited-time, callable 25-month CD paying 2.27% APY (anyone can donate to eligible charitable organization to gain membership). E-Loan Bank has a 5-year CD paying 2.45% APY but with a big early withdrawal penalty of two years of interest.

Longer-term Instruments
• Willing to lock up your money for 10+ years? Did you know that you can buy certificates of deposit via Vanguard’s bond desk? These “brokered CDs” offer the same FDIC-insurance and are often through commercial banks like Goldman Sachs. As of this writing, you can get a 10-year CD maturing 8/12/2025 that pays 3.05% APY. Prices will vary regularly.
• How about two decades!? “Series EE” US Savings Bonds are not indexed to inflation, but they have a guarantee that the value will double in value in 20 years, which equals a guaranteed return of 3.5% a year. However, if you don’t hold for that long, you’ll be stuck with the normal rate which is quite low (currently a sad 0.50% APY). Think of it as a huge early withdrawal penalty. You really want to be sure you’ll keep it for 20 years.

How about my money? In terms of the opportunities above, I have opened an account at Everbank in the past for the promo rate and I have usually try to buy the max in US Savings I Bonds each year (no EE bonds, too long of a commitment). I don’t currently juggle any rewards checking accounts nor do I have any deposits with any other banks mentioned above. It’s just not worth it me to switch right now.

Besides some older CDs at higher rates, I keep a good chunk of my money at Ally Bank because right now they are the all-around “good enough” bank for me. Sure I could eek out 1.05% in a savings account somewhere, but Ally Online Savings is paying a 0.99% APY (as of 8/6/15) which serves as a no-fee overdraft companion to my Ally Interest Checking with ATM fee rebates. Along the same lines, I could get 2.25% in an outside bank’s 5-year CD, but Ally has 2.00% APY on their 5-year CDs and a relatively short 150-day early withdrawal penalty. A rate difference of 0.25% on $10,000 over a year is $25, and I’m not sure that’s enough to open a CD at another bank when my current Ally CDs mature.

All rates were checked as of 8/6/15.

Navy Federal Credit Union has solid bank and loan products, including checking accounts with ATM rebates, competitive mortgage rates, and limited-time 0% balance transfer promotions. Membership eligibility for NavyFed is primarily restricted to Marine Corps, Navy, Air Force, and Coast Guard regular Active Duty and reservists, and Army and Air National Guard personnel, but also includes family and household members of existing NavyFed members and some civilian employees in the Department of Defense.

If you’re a member, the exclusive perks mean that you should sign up your kids sometime… and right now you can get $100 for doing so! As part of their Youth Week 2015 promotions, you can get:

• $25 for signing up your child (under 18) for membership.
• $25 for opening a Campus Checking Account for your child (age 14-17), which has no minimum balance requirements and up to $10 in ATM fee rebates per statement period.
• $25 for opening a SaveFirst Account for your child (under 18) with as little as $5.
• $25 for opening a reloadable prepaid Visa® Buxx Card for your child (age 10-17).

Expires soon on April 18th, 2015. Thanks to reader Charles for the tip.

Our family keeps a year’s worth of expenses (not income) put aside in cash reserves; it provides financial insurance with the side benefits of lower stress and less concern about stock market gyrations. In my opinion, emergency funds can actually have a better return on investment than what you see on your bank statement.

I don’t rate-chase nearly as much as I used to, but it still pays to shop around. Too many places are basically paying ZERO – the Megabanks, short-term US Treasuries, and money market sweep funds. Do you know what Chase offers on a 1-year CD? 0.02% APY. Bank of America on their 5-year CD? 0.15% APY. The highest money market mutual fund in the country yields 0.06%. My Vanguard Prime is at 0.01%.

Best Currently Available Interest Rates
Here is a brief summary of the best interest rates available on deposits backed by the full faith and credit of the US government. I will try to sort them from the shortest to longest maturities.

• High-yield savings accounts. There are a variety of online savings accounts out there nowadays, with the highest ones earning around 1% APY. GE Capital Bank has an FDIC-insured Online Savings account paying 1.05% APY with no maintenance fees, no minimum balance, and no minimum to open.
• Short-term guaranteed rates. Everbank Yield Pledge Money Market and Interest Checking account both offer 1.40% APY guaranteed (up to $50k each) for the first 6 months for new accounts. Since it is fixed, this is essentially a 6-month CD with a higher rate than any other 6-month CD rate out there and with no early withdrawal penalty to worry about. Salem Five Direct has an eSavings account that pays 1.10% guaranteed until 1/1/16 (~8.5 months left) but the rate is only available to new customers.
• “Series I” US Savings Bonds offer rates that are linked to inflation. “I Bonds” bought right now will earn 1.48% total for the first six months, and then a variable rate based on ongoing inflation after that. You must hold them for a year, and if you redeem them within 5 years you lose the last 3 months of interest. While future rates are unknown, the net rate after a year is likely to be competitive with top 1-year CD rates at a minimum, while offering upside if inflation spikes. More info here.
• Rewards checking accounts pay above-average interest rates, but with some risk. You have to jump through certain hoops, and if you make a mistake you won’t earn any interest all that month. Rates can also drop quickly, leaving a “bait-and-switch” feeling. But the rates can be high while they last. Consumers Credit Union offers up to 5.09% APY on up to a $20k balance, although 3.09% APY is easier to achieve unless you satisfy a long list of requirements. I list this one because the rate is guaranteed until December 31, 2015.
• Certificates of deposit. If you have a large cushion, it’s quite likely to just sit there for years. Why not put some money in longer-term investments where you can still take it out in a true emergency and pay an early withdrawal penalty. Synchrony Bank (formerly GE Capital Retail Bank) is offering a 5-year CD paying 2.25% APY for $25k+ balances (2.20% APY for $2k+) with an early withdrawal penalty of 180 days interest. For example, if you withdraw from this CD after 2 years and pay the penalty, your effective rate earned will still be 1.69%.
• Willing to lock up your money for 10+ years? Did you know that you can buy certificates of deposit via Vanguard’s bond desk? These “brokered CDs” offer the same FDIC-insurance and are often through commercial banks like Goldman Sachs. As of this writing, you can get a 10-year CD maturing 4/22/2025 that pays 2.95% APY. Prices will vary regularly.
• How about two decades!? “Series EE” US Savings Bonds are not indexed to inflation, but they have a guarantee that the value will double in value in 20 years, which equals a guaranteed return of 3.5% a year. However, if you don’t hold for that long, you’ll be stuck with the normal rate which is quite low (currently a sad 0.50% APY). Think of it as a huge early withdrawal penalty. You really want to be sure you’ll keep it for 20 years.
• Finally, how about something out-of-the-box? You can earn up to 2.25% APY within a 529 college savings plan (which can be opened with you as the beneficiary for now). FDIC-insured, and the rate is still pretty good even after a 10% penalty for non-qualified withdrawals.

How about my money? In terms of the opportunities above, I have opened an account at Everbank in the past for the promo rate and I have usually try to buy the max in US Savings I Bonds each year (no EE bonds, too long of a commitment). I don’t currently juggle any rewards checking accounts nor do I have any deposits with any other banks mentioned above. It’s just not worth it me to switch right now.

Besides some older CDs at higher rates, I keep a good chunk of my money at Ally Bank because right now they are the all-around “good enough” bank for me. Sure I could eek out 1.05% in a savings account somewhere, but Ally Online Savings is paying a 0.99% APY (as of 4/12/15) which serves as a no-fee overdraft companion to my Ally Interest Checking with unlimited ATM fee rebates. Along the same lines, I could get 2.25% in an outside bank’s 5-year CD, but Ally has 2.00% APY on their 5-year CDs and a relatively short 150-day early withdrawal penalty. A rate difference of 0.25% on $10,000 over a year is $25, and I’m not sure that’s enough to open a CD at another bank when my current Ally CDs mature.

All rates were checked as of 4/12/15.