why is the interest rate for checking higher than savings?
why would any one open a savings when they can have a checking and have higher interest rate
- StephenWeinsteinLv 71 month agoFavorite Answer
Because you only get that interest rate on your checking if your balance is under $25,000 and you meet five other requirements. For example, I would not, because I don't have "12 Visa Debit Card transactions per statement cycle", so I would get only .05% interest. Also, if you have more than $25,000 to put in the bank and want the higher interest rate, then you'd need to open both the checking account (with under $25,000) and the savings account (for the rest of the money), because if you put more than $25,000 in the checking account, then the interest rate is only .20% (which is less than 1/10th of the rate for the savings account).
Also, rates can change at any time, and 3% is unusually high for a checking account, so they may just be advertising a 3% rate for a short time to draw in customers, and be planning to lower it (or change the requirements) later. Or they may keep the rate if they find that most customers don't meet the requirements and don't get the 3% interest.