- 1 Schwab One Individual Brokerage Plus Schwab Bank Investor Checking
- 2 Schwab One Individual Brokerage Plus Schwab Bank Investor Checking, td hold policy
- 3 Schwab High-Yield Investor Checking
- 4 10 Best Checking Accounts of 2016
- 4.1 Best: Bank5 Connect High-Interest Checking
- 4.2 Banks That Rounded Out the Top 10
- 4.3 Bank of Internet USA Rewards Checking
- 4.4 Charles Schwab Bank High Yield Investor Checking
- 4.5 iGOBanking.com High Interest Checking
- 4.6 Ally Bank Online Interest Checking
- 4.7 Compare the Best Checking Account Features
- 5 Schwab Bank Deposit Account Agreement
- 6 The best checking accounts for 2016
Schwab One Individual Brokerage Plus Schwab Bank Investor Checking
Schwab One Individual Brokerage Plus Schwab Bank Investor Checking, td hold policy
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Schwab High-Yield Investor Checking
Since graduating college, I’ve been a fairly happy Bank of America checking account holder. There are an absurd number of BofA ATMs in Boston and a reasonable number of branches. However, there is a $750 minimum balance requirement that sort of grinds on me – mostly because the account makes no interest. New checks cost a ridiculous $25, which I am forced to pay nearly every year as I move around.
A few months ago I saw an ad for Schwab High-Yield Investor Checking. It advertised 3% interest, no minimum balance, all ATM fees [domestic and international] refunded. It seemed too good to be true – but Schwab is a respectable name, so I gave it a good look and opened an account.
This is a great deal. It’s not too good to be true, and there isn’t a catch.
- 2.01% variable APY – [about 5x the national average]
- No minimum balance requirement
- All ATM fees are refunded [both domestic and international]
- Free bill pay
- Free checks
- Overdraft protection
- Built in brokerage account [with reasonable trading fees]
The major downside is that you won’t be able to interact with a real person at a local branch, although they have 270 investment branches you can supposedly go to for service. Apart from that, it’s pretty nice. The website isn’t quite as pretty as the BofA site, but is certainly just as functional.
For an even higher interest rate, Jon keeps all of his money in the the [dubiously named] Bank of Internet USA, which is currently yielding 3% on a $1,000 minimum balance. I’m not too sure about that one.
Thanks for the tip — I recently opened a similar account at ING Direct. The Electric Orange account is similar to your Schwab account, though I opened an Orange Savings Account which pays 3% interest, which comes highly recommended and would choose over the “Bank of Internet USA” on name alone.
(Man, seems I need to proofread before I hit the submit button.)
@Geoff – I think Electric Orange requires > 50k in the account to get that 3.2% APY
Right. I still have my regular checking account at Wells Fargo, but moved my savings to ING Direct. I’ve got so much direct deposit and direct debit stuff wired into my WF account that it’d be hard to move. What’s really nagging me about the WF account is the $10 monthly fee for online bill-pay and Quicken integration.
A few credit unions around here have “rewards checking” accounts with a 6.01% interest rate on up to 25K. It’s pretty sweet. The downside is you must do 10 debit card transactions per month, but I do that anyways. I think they get money from VISA.
Coulee Bank ( http://www.couleebank.net ) offers an incredible 6.01% APY with their Rewards Checking account. The rate is easy to earn. All you have to do is make 10 check card transactions a month, use e-statements, and do 1 automatic payment a month (they call it ACH). Coulee Bank pays 6.01% on the first $25,000 and 1.01% on anything above that. The best thing about this account besides the rate is it is FREE, you can apply online, and it is from a great bank with real people that answer the phone. And as they like to say, Banking Green has its Rewards. The Rewards Checking account saves paper and preserves our natural resources. No wonder I feel good about recommending this to everyone I know. Check it out. I guarantee you will love it.
So what happened to the 3% they advertised? I thought there was a 3% offer from Schwab but I haven’t been able to find it.
10 Best Checking Accounts of 2016
If all your checking account has done for you lately is charge you fees to store your money, then it's time to move on to a new account that doesn't sap your balance with numerous surcharges and actually pays interest so your money can grow. Yes, no-fee, interest-bearing checking accounts really do exist -- and GOBankingRates has found the best ones.
GOBankingRates identified the top 10 checking accounts in the U.S. based on five criteria: annual percentage yield, minimum deposit, monthly maintenance fee, nonsufficient funds (NSF) fee and minimum balance required to avoid fees; APY and minimum balance were weighted double in our methodology. The accounts reviewed were the most basic checking accounts offered by the financial institutions surveyed for our Best Banks of 2016 rankings.
Here are the 10 best checking accounts currently available. If your bank isn't on the list, and you're unhappy with your current checking account, you might want to consider switching.
Best: Bank5 Connect High-Interest Checking
Why: Bank5Connect, which earned the top spot in GOBankingRates' 2015 Best Checking Account ranking, is still the best checking account provider because it continues to offer one of the highest rates, no monthly fees, an NSF fee of just $15 and a minimum deposit of $10.
Review: This online-only bank is able to offer a competitive rate of 0.76% APY on its High-Interest Checking account because it has lower overhead costs than brick-and-mortar banks. The minimum balance to earn interest is $100.
This account includes several free features: online banking, mobile banking, bill pay and the first order of checks. Plus, Bank5 Connect won't charge you for using any ATM and will reimburse other banks' ATM fees up to $15 per statement cycle. It also offers a UChoose Rewards program that lets you earn points when you use your debit card. The points can be redeemed for gift cards, vacation packages and other items.
How to open: You can open an account online or by calling 855-55BANK5. The process takes about 10 minutes, and you'll need your Social Security number, valid ID and previous home address if you've lived at your current address for less than two years. You can fund the account with a credit card, debit card, checking account or savings account.
Banks That Rounded Out the Top 10
Bank of Internet USA Rewards Checking
Why: This account charges no monthly maintenance fee or NSF fee and offers a 0.42% APY. It doesn't have a minimum monthly balance requirement, but it does require a minimum deposit of $100.
Review: Although the minimum deposit required is higher for the Bank of Internet USA Rewards Checking account than most of the other accounts in this top 10, it offers several attractive features. For example, you can boost the rate you earn up to 1.25% APY if you use your Rewards Checking Visa debit card at least 10 times a month and if your account receives monthly direct deposits of $1,000 or more.
The account also offers unlimited ATM fee reimbursements, free bill pay, cash-back purchase rewards and free FinanceWorks money-management software. You can deposit money using the bank's free mobile app or by scanning checks from your computer using the free MyDeposit option on the bank's website.
How to open: You can open an account on Bank of Internet's website. You'll need your Social Security number, a valid ID and a valid U.S. address.
Why: There are no fees and no minimum deposit or minimum balance requirements on the Capital One 360 Checking account. It offers a 0.20% APY, which is higher than what many brick-and-mortar banks offer.
Review: The Capital One 360 Checking account's base APY of 0.20% increases to 0.75% APY on balances of $50,000 to $99,999.99 and to 0.90% on balances of $100,000 or more. Instead of overdraft fees, Capital One charges an interest rate of 11.50% on the amount you overdraw.
With this account, you have access to Capital One's network of more than 40,000 ATMs nationwide. Your first order of checks is free, as is online bill pay and the mobile app.
How to open: You can open an account online or by calling 800-289-1992. It takes about five to 10 minutes, and you'll need a check from an existing account to fund your new account.
Why: This online account has no monthly services fees, offers a 0.65% APY and has several free features. The minimum deposit to open an account is just $1.
Review: The FNBO Direct Online Checking account doesn't charge a monthly service fee, but it does charge a relatively hefty $33 NSF fee. However, it does offer one overdraft forgiveness per year. It also has free online banking, bill pay, account alerts, stop payments, debit card fraud monitoring and person-to-person payments with Popmoney, among other features.
How to open: You can open an account online. You'll need your Social Security or tax ID number, valid ID, employment information and information about any loans or mortgages you have to confirm your identity. You'll need your current bank account and routing numbers to transfer funds electronically to your new account.
Charles Schwab Bank High Yield Investor Checking
Why: This online account from Charles Schwab Bank has no minimum deposit or balance requirements and no monthly maintenance fee or NSF fee. The APY is just 0.06%, but the account is linked to a no-fee, no-minimum balance Schwab One brokerage account.
Review: Standard features on the Charles Schwab Bank High Yield Checking account are similar to those offered by other accounts in the top 10: free bill pay, unlimited ATM fee rebates and free standard checks. The big draw of this account, however, is that it allows you to open a Schwab One brokerage account without the usual minimum deposit of $1,000 and link it to your checking account.
How to open: You can open an account online in 10 minutes or download an application form, which you can send by mail. You'll need your Social Security number, driver's license and employer information. There's no minimum deposit to open an account.
iGOBanking.com High Interest Checking
Why: This online account requires a minimum deposit of just $1, has no monthly maintenance fee and has a 0.25% APY.
Review: The iGOBanking.com High Interest Checking account's $33 NSF fee is a drawback compared with some accounts on this list that offer lower fees. However, this account offers several attractive features, including free bill pay and a presentment tool that lets you import an unlimited number of bills and pay them online. You also can transfer funds electronically to others using iGoBanking.com's Pay People service. You can access your money without incurring fees at more than 43,000 ATMs in the Allpoint network.
How to open: You can open an account online in about 10 minutes. You'll need your Social Security number, valid ID, previous home address if you lived in your current location less than two years, and your current bank account and routing number to transfer funds electronically to your new account.
Ally Bank Online Interest Checking
Why: There is no monthly maintenance fee or minimum deposit requirement for this online account, which pays a 0.10% APY.
Review: The Ally Bank Online Interest Checking account has an overdraft fee of $25 and a tiered interest rate. The 0.10% APY jumps to 0.60% APY on balances of $15,000 or more.
Other perks include free online and mobile banking, bill pay and standard checks. You can use any Allpoint ATM for free and get reimbursed up to $10 per statement cycle for surcharges from ATMs outside the network. You also can send money electronically to others with Popmoney.
How to open: You can open an Ally Bank account online or by calling 877-247-2559. You'll need to provide your address, date of birth, Social Security number and valid ID. There's no minimum deposit to open an account.
Why: This online checking account from Simple Bank doesn't charge a monthly maintenance fee or NSF fee and doesn't require a minimum deposit. However, the APY is just 0.01%.
Review: Although Simple Bank's Simple Checking account has the lowest APY of the accounts on this list, it offers unique features that can help you stick to a budget and save money. The account lets you set savings goals and will show you how much is safe to spend based on those goals, your account balance, upcoming bills and pending transactions. You can access your money through the bank's network of 55,000 fee-free ATMs.
How to open: You must provide your email address to start the application process online. Then you must provide your name, birth date, occupation and Social Security number.
Why: This checking account offers the highest rate on this list -- 0.95% APY -- but it's applicable only during the first year after opening an account. The ongoing rate is 0.30% APY on balances under $10,000.
Review: The EverBank Yield Pledge Checking account offers a bonus interest rate of 1.60% APY on balances up to $100,000 in the first six months of opening an account. Although its APY offer is attractive, its minimum deposit requirement of $1,500 and the $30 NSF fee are high compared with other accounts in this top 10.
There's no monthly maintenance fee, and the account comes with features such as free mobile banking, bill pay and funds transfers with People Pay. Everbank doesn't charge ATM fees but only reimburses other banks' ATM surcharges if you have an account balance of $5,000 or more.
How to open: You can open an account online by providing your Social Security or tax ID number and proof of address if you've lived in your current location less than three months.
Why: This checking account has no monthly maintenance fee and a relatively low NSF fee of $17, but it also has no APY.
Review: The Arvest Bank Free Blue Checking account made it into the top 10 even though it doesn't earn interest because its minimum deposit of $50 and $17 NSF fee are lower than the fees charged by many of the other accounts surveyed for GOBankingRates' 2016 Best Banks rankings. The account also includes free online and mobile banking, free notary services and free checks for customers 62 and older.
How to open: You can open an account online, by calling 866-952-9523 or by visiting a local Arvest branch. You'll need a government-issued ID and Social Security number. You can transfer funds electronically from an existing account, mail a check, or deposit cash, a check, or a money order at a branch.
Compare the Best Checking Account Features
Methodology: To compile its list of the top 120 banks, GOBankingRates surveyed the FDIC's list of banks sorted by asset size, excluding non-active institutions, those with less than $1 billion in assets, investment banks and any institutions that require customers to use investment services to access commercial bank accounts. This list of 120 banks includes 90 brick-and-mortar banks and 30 online-only banks according to the GOBankingRates database. No asset threshold was consulted for online-only banks.
Criteria for ranking: To determine its Best Checking Accounts category ranking, GOBankingRates scored each bank's basic, personal checking account from most to least favorable for the following factors: (1) minimum deposit to open the checking account, (2) monthly maintenance fee, (3) minimum balance to avoid a fee, (4) annual percentage yield and (5) nonsufficient funds fee. Minimum balance to avoid a fee and APY were weighted more heavily than other ranking factors, and accounts were then ranked by overall score. In the case of a 10 th -place tie, tiebreakers were used in the following order: APY, monthly maintenance fee and then minimum deposit required to open the account.
Data was compiled via the GOBankingRates interest rate database and verified against the individual institutions' websites between Oct. 29 and Nov. 23, 2015. Rates, terms and conditions are subject to change at the discretion of the individual financial institutions. APY was based on the minimum deposit required to open the account. Some interest rates might be short-term or promotional offers only, and it is possible additional terms and conditions must be met in order to obtain the interest rates listed. Rates and availability might vary by region. Please verify terms and conditions before opening an account.
Schwab Bank Deposit Account Agreement
1 Effective October 2016 Please read this important information carefully. Schwab Bank Deposit Account Agreement Includes information about: Terms and Conditions for the Schwab Bank Bill Pay Service
2 Contents Introduction. 2 Definitions Terms Applicable Only to the Schwab Bank High Yield Investor Checking Account Your High Yield Investor Checking Account Schwab One /High Yield Investor Checking Linking Authorization General Terms Acceptance of Terms and Conditions Changes to Agreement Charging an Account Closing or Restricting an Account Fees Use of Account FDIC Insurance Governing Law Information About You Ownership of Accounts Disclosures for Specific Account Types Schwab Bank High Yield Investor Savings Account High Yield Investor Savings Account Limitations Interest on Your Funds Your Ability to Withdraw Funds Longer Delays May Apply Special Rules for ACH Transfers from Another Financial Institution Special Rules for New Accounts Special Rule for Schwab Mobile Deposit Nonsufficient Funds Overdrafts Nonsufficient Funds Overdraft Protection Real-Time Funds Transfers and Provisional Credit Electronic Banking Services Schwab Bank Visa Debit Card Access to Your Account Using the Internet Access to Your Account Using the Telephone Electronic Banking Disclosures Money Transfer Services Fedwire Sending Wire Transfers Originating Transfers Automatic Transfer Service Receiving Money Transfers General Provisions for All Money Transfers Supplemental Provisions for Money Transfers Processing Transactions Cutoff Time for Receipt of Orders Paying Checks and Other Items Returns of Deposited Items Deposits Withdrawals Additional Services Check and Deposit Slip Forms Copies of Checks, Deposit Slips and Statements Customer Service Notary Services Research/Account Reconciliation Stop Payment Orders. 34
3 12. Information About Clients Protecting Your Account Resolving Disputes Additional Terms Account Conversions/ Transaction Limits Circumstances Beyond Our Control Conflicting Claims About Your Account Cooperation in the Event of Forgery Death or Incompetence Legal Process Limitation of Liabilities and Indemnification Right of Setoff Statements and Notices Sub-accounts Unclaimed Property Waiver and Severability Maintain United States Address Processing and Execution of Electronic Transactions Taxpayer Information Terms and Conditions for the Schwab Bank Bill Pay Service. 43 Service Definitions. 43 A. Consent to Agreement B. Enrollment C. Payment Scheduling D. The Service Guarantee E. Payment Authorization and Payment Remittance F. Payment Methods G. Payment Cancellation Requests H. Stop Payment Requests I. Prohibited Payments J. Exception Payments K. Bill Delivery and Presentment.. 46 L. Exclusions of Warranties M. Password and Security N. Your Liability for Unauthorized Transfers O. Errors and Questions P. Disclosure of Account Information to Third Parties Q. Service Fees and Additional Charges R. Failed or Returned Transactions S. Alterations and Amendments.. 49 T. Address or Banking Changes.. 49 U. Service Termination, Cancellation or Suspension V. Third-Party Indemnification W. Biller Limitation X. Returned Payments Y. Information Authorization Z. Disputes AA. Assignment BB. No Waiver CC. Captions DD. Governing Law
4 Introduction Welcome to Schwab Bank, and thank you for opening a deposit account with us. When you use your account, you agree to the terms and conditions discussed in this document. Please read it carefully and keep it for your records. This document, the Application Agreement you signed when you applied for your account and the current Schwab Bank Deposit Account Pricing Guide ( Pricing Guide ) are the contracts (the Agreement ) between you and us for your deposit rela tionship with us. We provide a copy of this Agreement to you at account opening or before a service is provided. There may also be other agreements for related services, which we will provide to you when or before a service is provided. You should read these agreements prior to actually using your account or a service. You may obtain additional copies by contacting Customer Service. This Schwab Bank Deposit Account Agreement consists of the following sections: Section 1 contains the terms which are applicable only to Schwab Bank High Yield Investor Checking accounts Sections 2 16 contain the terms which are applicable to all deposit accounts, including High Yield Investor Checking (unless specifically noted otherwise) We have also included the following in this document: Terms and Conditions for the Schwab Bank Bill Pay Service (applicable to all checking accounts) Definitions Throughout this document, the words you, your and yours refer to each account owner. Schwab Bank, we, us and our refer to Charles Schwab Bank and any vendor we may, in our sole discretion, involve in providing any service described herein (other than Charles Schwab & Co., Inc.). As used in this Agreement, the terms listed below are defined as follows: Access Code: A Personal Identification Number (PIN) used in conjunction with your Debit Card or Schwab Bank by Phone, an Internet Banking password, or any similar number or code which is used to authenticate you and give you access to your account. ACH: See Automated Clearing House. Application Agreement: The agreement you signed at account opening (or upon certain maintenance changes to your account) on which you agreed to the terms and conditions of the account. Automated Clearing House: A funds transfer system, governed by the Operating Rules of the National Automated Clearing House Association, which provides for interbank clearing of electronic transactions by participating financial institutions. Available Funds: The portion of your Ledger Balance that is available for immediate withdrawal. Funds in your account are not available if we determine that they are subject to a hold, dispute or Legal Process that prevents their withdrawal. Average Daily Balance: The sum of your daily Ledger Balances for the month, divided by the number of calendar days in the month. Bank Branch: (a) The Reno Office and (b) offices of Charles Schwab & Co., Inc. that have also been designated as branch offices of Charles Schwab Bank. Beneficiary: The person who receives the proceeds from a Money Transfer. 2
5 Business Day: Schwab Bank business days are Monday through Friday, excluding Federal Reserve Bank holidays. Business Day Cutoff Time: The day and time, Monday through Friday, excluding Federal Reserve Bank Holidays, when you must submit a Real-Time Funds Transfer request in order to receive same-day access to available funds from your Schwab One brokerage account. Please call a Schwab Bank customer service representative for the current Business Day Cutoff Time. Check Conversion: A check that you have given to a payee (a merchant or a biller) that the payee has converted into an electronic transaction. This definition does not include a check that you have given to a payee that has been returned unpaid and that the payee converts to an electronic transaction for the purpose of representing the item. Controversy: Any controversy or claim concerning your deposit account relationship with us, including any claim based on or arising from an alleged tort. Debit Card: Refers to either a Schwab Bank Visa Platinum Debit Card or a Schwab Bank Visa Debit Card. Allows you to access your account at Automated Teller Machines (ATMs) and to pay for purchases using a Point-of-Sale Debit. Also referred to as a check card. Direct Deposit: An ACH credit entry to your account that you authorize. It is usually used to deposit funds owed to you (such as when you authorize your employer to credit your account for your payroll). Electronic Debit: A charge to your account that you authorize; includes Preauthorized Debits, Point-of-Sale Debits and Check Conversions. Schwab Bank Bill Pay Service, Electronic Debits and Direct Deposits. Fedwire: The wire transfer system of the U.S. Federal Reserve Banks. Inactive Account: A deposit account for which the client has not initiated any activity or contacted us about for a period of between six months and two years. Internet Banking: Refers to either (a) access to your High Yield Investor Checking account or your High Yield Investor Savings account (provided you also have a Schwab Brokerage account) at (b) for clients of independent investment advisors, access to your High Yield Investor Checking account or High Yield Investor Savings account (provided you also have a Schwab Brokerage account) at or (c) access to your other Schwab Bank deposit accounts at Ledger Balance: This is the preceding day s ending balance, plus the current day s credits, minus the current day s debits. Legal Process: A subpoena, restraining order, injunction, writ of attachment or execution, levy, garnishment, tax withholding order, search warrant, forfeiture or other similar order. Money Transfer: The movement of funds from one deposit account to another via electronic means; includes wire transfers, ACH transfers and direct transfers between accounts (including target balance transfers and overdraft protection transfers). OCL: See Overdraft Credit Line. Electronic Funds Transfer: This is either a debit or credit to your account which was originated electronically and includes transactions made at an ATM, Preauthorized Transfers, payments scheduled via the 3
6 Originator: In an ACH transaction, this is the party originating the payment transaction, who has been authorized to send debits or credits to another s account. For example, for a Direct Deposit of payroll, the Originator would be the employer. For direct payment of a utility bill, the Originator would be the utility company. Overdraft Credit Line: A line of credit that can be attached to one or more checking accounts for the sole purpose of overdraft protection. Overdraft Source: In an overdraft protection option, this is the source from which funds will be transferred, should the balance in a linked Protected Account fall below zero. Payee Endorsement: The signature or stamp placed on the back of the check by the person to whom the check is payable indicating their desire to transfer ownership of the check. Payee Endorsement Area: The area that extends one inch from the trailing edge of the back of the check. The trailing edge is the left side of the check when you look at it from the front. PIN: Personal Identification Number used to identify you. Point-of-Sale Debit: A charge to your account that you authorize when you use your Debit Card to make purchases at a merchant. Postdated Check: A check written with a future date on it. Preauthorized Debit: A charge to your account that you authorize that is made via the Automated Clearing House. It is usually used for recurring bill payments (such as when you authorize a utility company to debit your account in payment for your monthly bill). Preauthorized Transfer: A charge to your account that you authorize; includes telephone transfers, automatic transfers and online banking transfers. Pricing Guide: A separate document, entitled Schwab Bank Deposit Account Pricing Guide, which contains current fees applicable to deposit accounts and related services. Protected Account: In an overdraft protection option, this is the checking account to which funds will be transferred, should the account balance fall below zero. Real-Time Funds Transfer: A transfer from your Schwab One account to your Schwab Bank deposit account, initiated by you, before the Business Day Cutoff Time. You will have same-day access to funds transfers initiated before the Business Day Cutoff Time. You may receive provisional credit for transfers initiated after the Business Day Cutoff Time. Reno Office: Refers to the Reno Main Office of Charles Schwab Bank, located at 5190 Neil Road, Suite 100, Reno, NV Schwab Brokerage: Refers to our affiliate, Charles Schwab & Co., Inc., a registered broker-dealer. Security Procedure: A procedure used by you and us, in conjunction with a Money Transfer, to verify the authenticity of a transfer request. Stale-Dated Check: A check that is dated more than six months before the day on which it is presented to be cashed, deposited or paid. Statement Period: A period of time, of about one month, covered by an account statement. It may end on any Business Day during the month. We will send you a monthly account statement unless there is no account activity other than the posting of interest. We will send you a statement at least quarterly, even if there is no activity in your account. 4
7 Substitute Check: To make check processing faster, federal law permits banks to replace original checks with Substitute Checks. These checks are similar in size to original checks with a slightly reduced image of the front and back of the original check. The front of a Substitute Check states: This is a legal copy of your check. You can use it the same way you would use the original check. You may use a Substitute Check as proof of payment just like the original check. Transfer Completion Date: When originating an electronic transfer, this is the date you wish the funds to be credited to the receiving account. Unclaimed Account: A deposit account for which the client has not initiated any activity or contacted us about for a period of two years or longer. Target Balance Amount: If you elect to activate the Target Balance Transfer feature, this is the minimum Ledger Balance you designate for your High Yield Investor Checking account. 5
8 1. Terms Applicable Only to the Schwab Bank High Yield Investor Checking Account This Section 1 applies only to High Yield Investor Checking accounts and does not apply to any other Schwab Bank deposit account. 1.1 Your High Yield Investor Checking Account Your Schwab Bank High Yield Investor Checking ( High Yield Investor Checking ) account is an interest-bearing checking account linked to a corresponding Schwab One brokerage ( Schwab One ) account, maintained at Charles Schwab & Co., Inc. ( Schwab Brokerage ). This means that your High Yield Investor Checking account is linked to your Schwab One account for various purposes and features, as described in this document. Some of the methods of linking are automatic, while others require your authorization. The linkage between the accounts allows you to easily initiate transfers between them to meet your checking and investment needs. Further, linking can allow funds to move on an automated basis from your Schwab One account to your High Yield Investor Checking account through the following features: 1. Target Balance Transfers: Through the Target Balance Transfer feature, you may authorize Schwab Brokerage to automatically transfer funds from your Schwab One account to your High Yield Investor Checking account in order to maintain the minimum Ledger Balance you designate for your High Yield Investor Checking account ( Target Balance Amount ). If you elect to establish this feature, you authorize us to request Schwab Brokerage to make this transfer in accordance with the Schwab One /High Yield Investor Checking Linking Authorization (see Section 1.2). 2. Overdraft Protection: This feature systematically transfers funds from your Schwab One account to your High Yield Investor Checking account in order to provide you with coverage against nonsufficient funds in your High Yield Investor Checking account. This feature is described in the Schwab One /High Yield Investor Checking Linking Authorization (see Section 1.2). Other features of this linkage are described in various sections of this document. Your Schwab One account is governed by a separate set of terms and conditions which includes, but is not limited to, the Schwab One Account Agreement. Please contact Schwab Brokerage for these separate documents and the terms related to your Schwab One account with Schwab Brokerage. Please be advised that account restrictions placed on your Schwab One account may adversely affect your ability to conduct transactions in your High Yield Investor Checking account. 1.2 Schwab One /High Yield Investor Checking Linking Authorization This Schwab One /High Yield Investor Checking Linking Authorization relates to your Schwab One account at Schwab Brokerage and your High Yield Investor Checking account at Schwab Bank. Your Schwab One account remains an obligation solely of Schwab Brokerage. Likewise, your High Yield Investor Checking account remains an obligation solely of Schwab Bank. By executing the High Yield Investor Checking account application, you authorize Schwab Bank to instruct Schwab Brokerage to transfer funds from your Schwab One account to your High Yield Investor Checking account as set forth below. Schwab Bank and Schwab Brokerage are acting as your agent in performing these services. For information regarding your Schwab One account, please refer to your Schwab One Account Agreement which you received from Schwab Brokerage. 6
9 Target Balance Transfer 1 Through the Target Balance Transfer feature, you may authorize Schwab Brokerage to automatically transfer TBT Available Funds (as defined herein) from your Schwab One account to your High Yield Investor Checking account in order to maintain the minimum Ledger Balance you designate for your High Yield Investor Checking account. If you elect to establish this feature, you must establish a Target Balance Amount. The maximum Target Balance Amount using this feature is $99,000. TBT Available Funds will then be transferred from your Schwab One account into your High Yield Investor Checking account so that your High Yield Investor Checking account maintains a minimum Ledger Balance equal to your Target Balance Amount. 2 For example, assume your Target Balance Amount is $5,000. If the Ledger Balance in your High Yield Investor Checking account is $6,000 and you write a check for $3,000, Schwab Bank would request that Schwab Brokerage transfer $2,000 from TBT Available Funds in your Schwab One account into your High Yield Investor Checking account in order to maintain your Target Balance Amount of $5,000. TBT Available Funds in your Schwab One account for the purposes of target balance transfers are limited to your Authorization Limit, excluding your Available Margin Loan Value (as described in your Schwab One Account Agreement). If you have a debit balance in your Schwab One account, target balance transfers will not be made to your High Yield Investor Checking account. Schwab Brokerage does not consider pending securities trades (including the Automatic Investment Plan [AIP]) in your Schwab One account, pending debits to your Schwab One account, and pending transfers of funds from your Schwab One account in determining whether you have TBT Available Funds for target balance transfers. 3 Schwab Brokerage has sole discretion to determine TBT Available Funds and is not responsible for any errors in calculation or damages resulting from errors in calculation. You acknowledge that you are responsible for all debits in your Schwab One account, as described in further detail in your Schwab One Account Agreement. If you do not elect to activate the Target Balance Transfer feature at the time you open your High Yield Investor Checking account, it will not be activated. If you choose to activate the feature at account opening, but do not provide Schwab Bank with a Target Balance Amount, it will be set at the default amount stated on your High Yield Investor Checking account application. You may activate this feature later, change the Target Balance Amount or deactivate the feature at any time by contacting Customer Service. Assuming you have given us a reasonable opportunity to act on your request, the change will be effective before the next target balance transfer occurs. Your Target Balance Amount can be any whole positive number equaling $1 or more up to a maximum of $99,000. You may remove the target balance link between your High Yield Investor Checking account and Schwab One account, without affecting the relationship between these accounts for Overdraft Protection coverage. In order for the target balance transfer to occur, both your High Yield Investor Checking account and your Schwab One account must be open and active and the Target Balance Transfer feature must be High Yield Investor Checking 1 The Target Balance Transfer feature is a service provided by Schwab Bank. 2 The Target Balance Transfer sweep will decrease TBT Available Funds from your Schwab One account and may affect funds available for trading purposes. 3 If Schwab Brokerage determines that your Schwab One account must be restricted to provide available funds based on your Authorization Limit prior to placing securities trades, your eligibility for this feature may be revoked and your High Yield Investor Checking account may be closed. 7
10 activated. Further, your Schwab One account must have a minimum of $0.01 in TBT Available Funds to transfer and not have any restrictions preventing Schwab Brokerage from using funds in that account for a target balance transfer. All target balance transfers occur at the beginning of each Business Day (excluding Schwab Brokerage holidays), based on activity in your High Yield Investor Checking account since the previous Business Day. Transfers will be made from your Schwab One account once per Business Day, if needed, in order to maintain your High Yield Investor Checking account at the Target Balance Amount. The amount transferred will be the amount needed to satisfy the Target Balance Amount. If there are insufficient TBT Available Funds in the Schwab One account to meet the Target Balance Amount, all TBT Available Funds in the Schwab One account will be transferred. Overdraft Protection For our High Yield Investor Checking account, we offer multiple sources of overdraft protection, collectively referred to as Overdraft Sources, to help you protect your High Yield Investor Checking account from overdrafts. Your Schwab One account will automatically be linked to your High Yield Investor Checking account for overdraft protection after both accounts are open. It will remain linked for overdraft protection purposes unless you request otherwise. You may choose to also add other Overdraft Sources. Clients who qualify may be offered an Overdraft Credit Line (OCL). The OCL and certain other Schwab Bank checking and savings accounts may also be used as sources of overdraft protection. If you use your savings account as a source for overdraft protection, and it is needed to cover an overdraft, the transfer of funds from your savings account for this purpose will be included in the six debit transactions allowed from your savings account per Statement Period, as described in Section 4.1. By linking your Schwab One account to your High Yield Investor Checking account, you authorize Schwab Bank to request that funds in your Schwab One account be used as overdraft protection for your High Yield Investor Checking account. If you have established multiple Overdraft Sources, Schwab Bank will utilize the Overdraft Sources in the following order: 1. Request that Schwab Brokerage transfer Overdraft Funds (as defined herein) from your linked Schwab One account (including your margin account, which may incur margin charges as described in your Schwab One Account Agreement); 2. Access an overdraft credit line linked to your High Yield Investor Checking account, if you have been offered such a credit line and you have accepted it; 3. Access certain types of other deposit accounts you maintain with Schwab Bank, including a Schwab Bank High Yield Investor Savings account, if you have requested that these accounts be linked to your High Yield Investor Checking account for overdraft protection. You may change the order of these steps and add or remove an Overdraft Source at any time after your High Yield Investor Checking account is opened by contacting Customer Service. You should consider your own situation carefully and establish the order of Overdraft Sources that is the most beneficial to you. You acknowledge that the default order of steps may not be the most beneficial to you, depending on your situation. If you have an Overdraft Source linked to more than one Schwab Bank checking account, Schwab Bank will use the Overdraft Source to cover items in the order in which they are presented for payment, or in which it receives notice of an incoming debit. Should your primary Overdraft Source be unavailable (such as during a system or hardware outage), Schwab Bank may access an alternative Overdraft Source, even if there are Overdraft Funds in your primary Overdraft 8
11 Source. If you have only one source of overdraft protection, there may be instances (such as during a system or hardware outage) when overdraft protection is not available. If pending debits to your High Yield Investor Checking account would reduce the balance of Available Funds below $0, Schwab Bank will automatically transfer (or request that Schwab Brokerage transfer if your Overdraft Source is your Schwab One account) funds from your Overdraft Source to your High Yield Investor Checking account. If there are sufficient funds from all Overdraft Sources combined, Schwab Bank will use those funds to cover the overdraft. The exact amount needed to cover the overdraft will be transferred, up to the amount of funds in your Overdraft Source. If there are insufficient funds in the first Overdraft Source to cover the overdraft, all funds from that source will be transferred and then Schwab Bank will attempt to transfer funds from the next Overdraft Source in line. For example, assume you have two Overdraft Sources: first, your Schwab One account, and second, your High Yield Investor Savings account. If the Available Funds in your High Yield Investor Checking account are $6,000 and you write a check against your High Yield Investor Checking account for $8,000, Schwab Bank would request a transfer of $2,000 from your Schwab One account. However, if the balance of your Overdraft Funds in your Schwab One account is only $1,000, then Schwab Bank would first instruct Schwab Brokerage to transfer $1,000 from your Schwab One account into your High Yield Investor Checking account. Schwab Bank would then transfer $1,000 from your High Yield Investor Savings account (assuming you have sufficient funds in that account). If a check or other debit is presented for payment and there are insufficient funds in your account to pay the item, Schwab Bank will review the amount of available funds in your designated Overdraft Sources and will transfer available funds to cover the overdraft. If the amount of funds in your Overdraft Sources is insufficient to pay the amount of the check or other debit, in most cases Schwab Bank will not pay the item. However, if the item is paid and an overdraft is created in your account, Schwab Bank will periodically review your Overdraft Sources and will continue to transfer any available funds to your account until the amount of the overdraft is fully paid. Schwab Bank deposit accounts which may be used as an Overdraft Source are: Interest Checking Plus, High Yield Investor Checking and High Yield Investor Savings. Overdraft Funds in your Schwab One account for the purposes of overdraft protection are limited to your Authorization Limit (as described in your Schwab One Account Agreement). Schwab Brokerage includes the loan value of securities held on margin in your Schwab One account in determining funds available to transfer for overdraft protection. By electing to establish Overdraft Protection, you understand that you may create a margin loan in your Schwab One account, if applicable, that may be subject to daily interest charges. You acknowledge that you will be responsible for covering any margin calls, and that Schwab Brokerage may liquidate securities in your Schwab One account if necessary to cover a margin call, as further described in your Schwab One Account Agreement. You further acknowledge that neither Schwab Brokerage nor Schwab Bank will automatically transfer assets from your High Yield Investor Checking account to your Schwab One account to cover a margin call or any other High Yield Investor Checking 9
12 debit or obligation in your Schwab One account, even if funds are available in your High Yield Investor Checking account. 4 Schwab Brokerage does not consider pending securities trades (including the Automatic Investment Plan [AIP]) in your Schwab One account, pending debits to your Schwab One account, and pending transfers of funds from your Schwab One account in determining whether you have Overdraft Funds for overdraft protection. 5 Schwab Brokerage has sole discretion to determine Overdraft Funds and is not responsible for any errors in calculation or damages resulting from errors in calculation. You acknowledge that you are responsible for all debits in your Schwab One account, as described in further detail in your Schwab One Account Agreement. In order for the automated transfer to occur, both your High Yield Investor Checking account and your Overdraft Source must be open and active and linked with each other for the purposes of overdraft protection. Further, your Overdraft Source must not have any restrictions preventing Schwab Bank or Schwab Brokerage from using funds in that account for overdraft protection, and there must be sufficient Overdraft Funds, Available Funds and/or available credit from any one or all Overdraft Sources combined. Sections 2 16 apply to all Schwab Bank deposit accounts, including High Yield Investor Checking, unless specifically noted otherwise. 2. General Terms 2.1 Acceptance of Terms and Conditions The Application Agreement that you signed when you applied for your deposit account acknowledges that you will receive Schwab Bank s Facts: What Does the Charles Schwab Corporation Do With Your Personal 10 Information? (or any successor publication), including an arbitration provision, and the Terms and Conditions for the Schwab Bank Bill Pay Service; the Pricing Guide; and other related agreements at the time the account is opened or before a service is provided. The signature of each account owner on the Application Agreement confirms your acceptance of each of the terms, conditions and agreements listed in the documents above. 2.2 Changes to Agreement We may change, add to, or amend the Agreement at any time. We generally send you advance notice of the change or amend ment. If you maintain your account after the effective date of a change or amendment to the Agreement, you indicate your agreement to the change or amendment. If you do not agree with the change or amendment to the Agreement, you may close your account or cancel or simply stop using the affected service or feature before the effective date of the change or amendment. 2.3 Charging an Account We may deduct amounts you owe us under this Agreement, such as fees and overdrafts, from your account. If you don t have enough funds in your account to satisfy your obligation to us, we may deduct amounts you owe us from your other deposit accounts with us. We may request that Schwab Brokerage transfer Overdraft Funds (as defined herein) from your linked Schwab One account as explained above in Section 1.2. We may do this at any time without prior notice of any deduction. If there are not enough funds in your account or other Overdraft Sources to cover the fees and other amounts you owe us, we may overdraw your account. You agree to pay us immediately for all amounts that you owe us. 4 See your Schwab One Account Agreement for more information regarding your Schwab One Margin account. 5 If Schwab Brokerage determines that your Schwab One account must be restricted to provide available funds based on your Authorization Limit, prior to placing securities trades, your eligibility for Overdraft Protection may be revoked and your High Yield Investor Checking account may be closed.
13 2.4 Closing or Restricting an Account You or we may generally close your checking or savings account at any time without advance notice. We may, however, require you to give us advance notice when you intend to close your account by withdrawing all your funds from a savings or interestbearing checking account (see Section 10.5, Notice of Withdrawal ). This Agreement continues to govern matters related to your account even after your account closes. If you have a High Yield Investor Checking account and you, or Schwab Brokerage, close your linked Schwab One account, we will close your High Yield Investor Checking account. If you have a High Yield Investor Checking account and your linked Schwab Brokerage account is suspended or otherwise similarly restricted for any reason, we may take the same action on your High Yield Investor Checking account. If we close your High Yield Investor Checking account, we may mail a check for any remaining balance in that account to you at the address we currently show for your statement. We may return deposits and checks and other items that we receive after your account is closed, without any liability by us to you. 2.5 Fees You agree to pay for our services in accordance with the fees that apply to your account or for other services you may use as shown in the current Pricing Guide. You authorize us to charge your account for these fees. 2.6 Use of Account You may not use your account or any account-related service to process gambling transactions, or to conduct any other activity, that would violate applicable law. If we are uncertain regarding the legality of any transaction, we may refuse the transaction or freeze the amount in question while we investigate the matter. 2.7 FDIC Insurance Funds in your deposit accounts at Schwab Bank are insured, in aggregate, based on 11 account ownership type, by the Federal Deposit Insurance Corporation (FDIC), an agency of the United States government, up to the standard maximum deposit insurance amount. The standard maximum deposit insurance amount is $250,000. If you have free credit balances in an account held at Schwab Brokerage that are swept to an omnibus account at Schwab Bank, these balances are aggregated, based on account ownership type, with other funds you hold at Schwab Bank, for the purposes of the $250,000 limit. See your Schwab Account Agreement for details on sweep options. FDIC insurance does not apply to other types of accounts you may have with our non-bank affiliates (such as accounts you may have at Schwab Brokerage). If you would like additional information, you may contact Customer Service to ask for our brochure regarding FDIC insurance coverage, or you may contact the FDIC toll-free at ASK-FDIC ( ). Information can also be found on the Internet at 2.8 Governing Law The agreement you make with us, and the rights and obligations we both have, are governed by and interpreted according to applicable State of Nevada and federal law. 2.9 Information About You Schwab Bank complies fully with the customer identification requirements of the USA Patriot Act. When you apply to open a deposit account with us, you are required to give us information about yourself, including your name, date of birth, address, taxpayer identification number and your state driver s license, state identification card or military identification. You represent to us that this information about yourself is correct. We retain the information about your identity in our records. We may rely on this information until you notify us of a change by contacting Customer Service and we have had a reasonable amount of time to act on the new information. You must notify us promptly if you change your name, address or telephone number. If the All Deposit Accounts
14 notification is regarding a name change, we may require identification, such as a valid driver s license or identification card, marriage certificate, divorce decree, or court order. If you have a High Yield Investor Checking account and either we or Schwab Brokerage receive an address change from you, unless you request otherwise, your address on file will be updated for your High Yield Investor Checking account, any associated overdraft credit line and your accounts held at Schwab Brokerage that utilize the same mailing address. If you have other accounts at Schwab Bank, and you would like to change the address we have on file for those accounts as well, you must specifically ask us to update the address for those accounts. You certify that you are legally authorized to enter into this Agreement, that you have reached the legal age of majority in the state or territory where you reside, and that the personal information provided to Schwab Bank during the application process is true and correct. If you have not reached the legal age of majority in the state or territory where you reside or if you have provided false information during the application process, we may close your account. 3. Ownership of Accounts You provide us with account ownership information at the time of account opening, and we enter that information in our records. From then on, we may determine ownership of accounts from the information in our records. Individual Accounts If only one person s name appears in the title of an account, it is classified as an individual account and that individual has the sole right to withdraw funds from or provide instructions regarding the account. Joint Accounts If more than one person s name appears in the title of an account (without a trust or custodial designation), the account is classified as a joint account. All persons whose names appear on a joint account are co-owners of the account, regardless of whose money is deposited or who makes the deposits. Each co-owner acts as the agent of each other co-owner. We may limit the number of persons who may co-own a particular type of account. Each co-owner authorizes each other co-owner to operate the account without the consent of any other co-owner. This includes, but is not limited to, the authority to deposit funds and withdraw or transfer funds from the account; to endorse for deposit to the joint account on behalf of any other co-owner an item payable to another co-owner; to instruct us to stop payment on any item drawn on the account by any co-owner; to obtain a Debit Card; to sign up for, use or cancel Internet Banking; to enroll in, access and use the Schwab Bank Bill Pay Service; to draw upon any overdraft protection option connected to the account; to obtain information about the account, including transactions conducted by other co-owners; to pledge the individual coowner s interest in the account as security for any debts; and to close the account. Each co-owner is jointly and severally liable to us for: all fees and charges assessed against the account; all amounts owed to us on the account, such as overdrafts; and all costs, losses or liabilities related to this Agreement or the account. Unless you have requested otherwise (and we have accepted your request), all joint accounts are presumed to be joint accounts with the right of survivorship. Right of survivorship means that when a co-owner dies, the balance in the account belongs to the surviving co-owner(s) subject to our right to charge the account for any amount the deceased co-owner or a surviving co-owner owes us. Business or Other Nonpersonal Accounts We do not offer corporate, business or most types of other nonpersonal accounts. 12
15 Any account you open with us will be considered a personal account, and you agree that it will be used only for your own personal, family or household purposes. Transferring Ownership Your account is for your use only. You may not transfer or assign ownership of your account to another party without our written consent. If we consent, such transfer of ownership is effective only when recorded on our records. In order to effect such a transfer, we may require that you close the account and that the new account holder open a new account in his or her own name and be subject to our standard account-opening requirements and procedures. We may refuse to acknowledge or accept attempted pledges or assignments of an account or purported security interest in an account. 4. Disclosures for Specific Account Types For new accounts, we offer High Yield Investor Checking accounts and High Yield Investor Savings accounts. The following account type is not available to new account holders: Interest Checking Plus account. 4.1 Schwab Bank High Yield Investor Savings Account You may not write checks on the Schwab Bank High Yield Investor Savings account ( High Yield Investor Savings ), but you may use the Debit Card, if you request one. You may make any number of withdrawals or transfers in person at our Reno Office, by mail or at an ATM. You may also make six other debit transactions from your account per monthly Statement Period. A Debit Card for your High Yield Investor Savings account is optional. If you open a High Yield Investor Savings account and request a Debit Card, you will be issued a Platinum Debit Card. If you open a High Yield Investor Savings account and already have or open a High Yield Investor Checking account, your High Yield Investor Savings account will be linked to the Platinum Debit Card on your High Yield Investor Checking account. If you already have both a High Yield Investor Savings account and a High Yield Investor Checking account, your High Yield Investor Savings account will be linked to the Platinum Debit Card on your High Yield Investor Checking account. You may choose to use your High Yield Investor Savings account as an Overdraft Source for overdraft protection. If you use your High Yield Investor Savings account as an Overdraft Source and it is needed to cover an overdraft, the transfer of funds against the overdraft will be included in the six debit transactions allowed from your High Yield Investor Savings account per Statement Period. If your High Yield Investor Savings account is linked to the Platinum Debit Card on your High Yield Investor Checking account, but you do not choose to designate your High Yield Investor Savings account as an Overdraft Source, the source of funds will automatically follow the order as listed in the Overdraft Protection section of this deposit account agreement, or it will follow the order that you designated when you opened your High Yield Investor Checking account High Yield Investor Savings Account Limitations Federal regulations limit the number of withdrawals and transfers from a savings account to a total of six (6) each monthly statement cycle. The types of transfers that are limited are transfers to any other Schwab Bank or Schwab Brokerage account(s), transfers to any accounts you hold at other financial institutions, or transfers to third parties by means of: A Schwab Bank Visa Platinum Debit Card purchase; All Deposit Accounts 13
The best checking accounts for 2016
The best checking account I’ve found with free checking, no minimums, overdraft protection and unlimited reimbursement of any ATM usage.
Most of us hate our banks for gouging us for fee after fee, requiring minimums, and offering teaser rates that turn into nothing more than the same old BS accounts.
I’ve studied most of the checking accounts on the market and today, I’ll show you the best one I’ve found. In fact, it’s the one I use as my primary checking account.
Why is it important to choose the best checking account?
I talk a lot on this blog about building an automated personal finance infrastructure — a system that funnels your money to where it needs to go on a schedule, with minimal involvement from you. This way, the money left over after bills is yours to spend guilt-free. Chapter 5 of my book is all about how this system works and how to build your own.
Of all the components in that system, none are more crucial than your checking account. As I wrote in the book:
“I think of my checking account like an e-mail inbox: all my money goes in my checking account, and then I regularly filter it out to appropriate accounts, like savings and investing, using automatic transfers.”
Your checking account is the center of it all, the nexus of your bulletproof personal finance system. Unfortunately, as I also point out in the book, checking accounts are the number one place where unnecessary fees are levied. That’s why I wrote this post today: to share my favorite checking account, the one I personally use.
BEST CHECKING ACCOUNT: Schwab Investor Checking
Most people think of Charles Schwab as an investment bank. But they also offer what I believe to be the best checking account available. Why?
- Interest on your deposits
- No fees
- No minimums
- No-fee overdraft protection
- Free checks
- Deposit checks via pre-paid envelopes or via iPhone app (snap photos of your check — no need to go into branch)
- An ATM card
- BEST BENEFIT: Unlimited reimbursement of any ATM usage
This last point is critical. How often do you go out with friends and have to withdraw money from out-of-network ATMs? How often do you find yourself at a liquor store at 3:30am, needing to withdraw $280, but you hesitate because of onerous ATM fees?
Those fees can add up, and Schwab reimburses you for all of them. If you rack up $200 worth of ATM fees in a month, you’ll see a $200 deposit from Schwab before the month ends. This means you can use ANY ATM — corner stores, other banks, whatever — without having to look for some specific bank’s ATM.
When I saw this account, I wanted to marry it.
“But I don’t want to use an online bank.” Some people will balk at using Schwab because it’s an online bank. That’s fine, but I urge you to reconsider: It’s rare to find a checking account that (1) avoids screwing you at every turn, and (2) actually rewards you for using them.
Remember: the whole point of having an automated personal finance system is that your money gets taken care of automatically. Who wants to visit a bank branch for routine financial matters? Once this system is up and running, you wont have to.
You know by now that I’m all about big wins. The ATM-fee reimbursement for the rest of your life is enough of a benefit, but stack on the trust Schwab has built with me, and I’m a long-term customer.
Open a new checking account with Schwab
To get started with the Schwab Checking Account, click here. I have no relationship with Schwab except being a happy customer.
To learn how to fully automate your finances — including ultra-specific recommendations on accounts, investing, debt, negotiation, money & relationships, and buying a car/house — pick up a copy of my book, on sale for less than $10.