Average Checking Account Interest Rates 2019 - Elite Personal Finance
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Average Checking Account Interest Rates 2019

EPF Last Update: March 27, 2019
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Citing the latest data from the Federal Deposit Insurance Corporation (FDIC) – for the week of March 18, 2019 – national average checking account interest rates currently sit at 0.06%.

 

Deposit Product: National Average Interest Rate:
Checking Account 0.06%

 

Applicable to non-jumbo deposits – less than $100,000 – average checking account interest rates display a slight deficit compared to their savings counterparts (0.10%).

As well, the current interest rate cap for checking accounts is 81 basis points (0.81%). The cap is calculated by adding 75 basis points (0.75%) to the national average rate. The purpose of the rate cap is to prevent traditional FDIC member institutions from offering checking account interest rates that exceed a particular fair value.

 

Average Checking Account Interest Rates 2019: Statistics and Key Findings:

Historical national average checking account interest rates have decreased by a spread of 0.07% over the last 10-years. However, recently they have increased by a spread of 0.02% over the last two-years.

Of the 11 traditional banks in our study, only two offer average checking account interest rates that supersede the current national average of 0.06%.

Within the traditional bank category, average checking account interest rates range from 0.01% to 0.20% with both Huntington National and Capital One (0.20%) offering the highest average rates. Conversely, the largest traditional banks – Bank of America (0.01%), Chase Bank (0.01%) and Citibank (0.023%) – offer some of the lowest average checking account interest rates.

Online banks offer average checking account interest rates that range from 0.01% to 1.25%. Axos Bank (1.25%), Aliant High-Rate Checking (0.65%) and Radius Bank (0.50%) offer the highest average rates, while HSBC Direct Checking (0.01%), Ally Bank (0.10%) and TIAA Bank (0.25%) offer the lowest average rates.

 

 

Average Checking Account Interest Rates 2019: Charts, Graph, Analysis

 

Historical US National Average Statistics

After displaying a continuous decline from the end of 2009 until the end of 2017, national average checking account interest rates began to show signs of life in late 2018. Declining by a spread of 7 basis points (0.07%) over the last 10-years, the recent two-year uptick is attributed to a rise in short-term interest rates by the Federal Reserve.

 

Year: National Average Checking Account Interest Rate (End of Year):
2009 0.13%
2010 0.10%
2011 0.07%
2012 0.05%
2013 0.04%
2014 0.04%
2015 0.04%
2016 0.04%
2017 0.04%
2018 0.06%
2019 0.06%

Historical US National Average Statistics

 

However it’s worth noting, even though the Effective Federal Funds Rate has increased by nearly 1% since the start of 2018, average interest rates within checking accounts have been relegated to a pedestrian 0.02% increase.

 

Average Checking Account Interest Rates: Traditional Banks

When analyzing some of America’s largest traditional banks, we found almost all of the institutions have average checking account interest rates that fall below the national average. Of the 11 banks sampled in our study, only two offer average checking account interest rates that supersede 0.06%.

For analysis purposes, all of the average interest rates below apply to checking account balances less than or equal to $10,000. As well, all sampled institutions are FDIC insured up to $250,000.

When breaking down the numbers, average checking account interest rates range from 0.01% to 0.20%, with both Huntington National and Capital One – from an interest-only perspective – having the best options.

Check out the chart below:

 

Institution: Average Checking Account Interest Rate:
Bank of America 0.01%
Wells Fargo 0.03%
Citibank 0.023%
Chase Bank 0.01%
HSBC 0.01%
US Bank 0.01%
SunTrust 0.01%
PNC Bank 0.01%
Huntington National 0.20%
TD Bank 0.025%
Capital One 0.20%

* Checking Accounts that don’t pay interest are excluded from calculated averages

Average Checking Account Interest Rates: Traditional Banks

 

Conversely, the largest US traditional banks – Bank of America, Chase Bank and Citibank – offer some of the lowest average checking account interest rates; however they are able to do so because of their immense brand power and reliable customer loyalty.

 

Average Checking Account Interest Rates: Online Banks

When assessing online-only offers, you see a slight uptick in average checking account interest rates. With rates ranging from 0.01% to 1.25%, the data has much more variance than the traditional bank numbers above.

However, to ensure equality, all average rates assume balances less than or equal to $10,000.

 

Institution: Average Checking Account Interest Rate:
Ally Bank 0.10%
Charles Schwab Bank 0.40%
HSBC Direct Checking 0.01%
TIAA Bank 0.25%
Radius Bank 0.50%
Axos Bank 1.25%
Alliant High-Rate Checking 0.65%

* Checking Accounts that don’t pay interest are excluded from calculated averages

Average Checking Account Interest Rates: Online Banks


At the top-end of the range is Axos Bank.

Offering 1.25% within its Rewards Checking Account, the online lender positions itself well-above its peers. However, to qualify for the full 1.25%, you need to meet three requirements – each triggering a 0.4166% bonus.

  1. Direct deposit $1,000 or more in your account each month
  2. Use your Axos debit card for a total of 10 transactions per month (min $3 per transaction)
  3. Use your Axos debit card 5 more times for a total of 15 transactions per month (min $3 per transaction)

Radius Bank is another high quality offering.

With an average checking account interest rate of 0.50%, the company has three account options. However, to receive 1% or 0.50% the company requires a minimum deposit of $2,500. To earn 0.01%, it requires a minimum deposit of $1,000. As well, balances less than the minimums don’t earn any interest.

With Charles Schwab Bank (0.40%), you have zero minimum balance requirements. However to qualify, you have to link its High Yield Checking Account to an online brokerage account.

Last in the high-end range is Aliant High-Rate Checking (0.65%).

While its average checking account interest rate is higher than both Radius and Charles Schwab, it’s the only institution in our study that does not have FDIC coverage. As a credit union, Aliant is insured – up to $250,000 – by the National Credit Union Association. Created by the U.S. Congress in 1970, the Federal Agency provides deposit protection analogous to the FDIC.

When breaking down Aliant’s interest rate requirements, it categorizes interest payments as Checking Dividends.

To qualify, you must:

  1. Opt for electronic statements only
  2. Set up a recurring monthly electronic deposit which can be payroll, ATM, mobile check, or recurring transfers from another financial institution

Account holders who meet both monthly requirements receive 0.65% interest – paid at the end of each month. If you don’t meet both requirements, you don’t receive a dividend for that month.

 

How We Conducted the Study

Using the latest data from the Federal Deposit Insurance Corporation (FDIC) as well as interest rate data from the official websites of traditional and online banks, we broke down the numbers to present the most accurate depiction of average checking account interest rates within the United States.

As well, our study uses the most up-to-date statistics as of March 18, 2019.

 

Conclusion

While checking accounts are not used for investment or growth purposes, many options in our study provide a small amount of interest relief regardless of your account balance.

Most notably is Axos Bank.

Even if you fulfill two of its three interest rate requirements, you still earn 0.18% more on your money than with a comparable Aliant High-Rate Checking account.

Most important, a respectable interest rate helps you keep pace with inflation. As the cost of goods and services rise, your purchasing power declines in the process. While none of the products above come close to the 2% target, they can still keep you from falling too far behind.

 

Sources

Current US National Average Checking Account Interest Rates

Historical US National Average Checking Account Interest Rates

Traditional Banks:

Bank of America Average Checking Account Interest Rates

Wells Fargo Average Checking Account Interest Rates

Citibank Average Checking Account Interest Rates

Chase Bank Average Checking Account Interest Rates

HSBC Average Checking Account Interest Rates

US Bank Average Checking Account Interest Rates

SunTrust Average Checking Account Interest Rates

PNC Bank Average Checking Account Interest Rates

Huntington National Average Checking Account Interest Rates

TD Bank Average Checking Account Interest Rates

Capital One Average Checking Account Interest Rates

Online Banks:

Ally Bank Average Checking Account Interest Rates

Charles Schwab Bank Average Checking Account Interest Rates

HSBC Direct Checking Average Checking Account Interest Rates

TIAA Bank Average Checking Account Interest Rates

Radius Bank Average Checking Account Interest Rates

Axos Bank Average Checking Account Interest Rates

Aliant High-Rate Checking Account Interest Rates

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