In February 2022, American Express launched its first consumer digital checking account, offering a competitive APY (annual percentage yield) and rewarding Amex cardholders with points for eligible debit card purchases.
In this post, we’ll cover the basics, pros/cons, and whether it’s worth it for you.
One of the big advantages of the account is that it doesn’t have a lot of the fees you would typically expect. For example, it has no monthly maintenance or minimum balance fees. Plus, you don’t have to worry about overdraft fees since it’s a debit card; the transaction will just decline. You can also withdraw money for free at over 37,000 MoneyPass ATMs.
There are still fees though. For example, there’s a 2.7% foreign transaction fee. If you travel abroad frequently and use a debit card, it might make sense to add a different card that has that feature.
The account offers 0.5% APY which is dramatically higher than the 0.03% average interest rate for other banks.
The debit card earns you 1 Amex Membership Rewards point for every $2 in qualifying debit card spend. This is one of the most interesting parts of the program if you care about points.
Is this worth it? For transactions where you can use a credit card, probably not. This is interesting for purchases that are limited to debit cards though or ones where credit cards are prohibitively expensive (i.e., fees outweighing the points you earn). The fact that debit cards are usually not great earners makes this an interesting play.
The MR points earned through the checking account are the same as the MR points earned from cards like the Platinum or the Gold. This means that you can combine your points to get more value, including the ability to transfer them to partners.
If you only have an Amex consumer card that earns rewards other than Membership Rewards points, such as the Amex Blue Cash Preferred® Card or a co-branded Amex card like the Hilton Honors American Express Surpass® Card or Delta SkyMiles® Gold American Express Card, you can still sign up for Amex Rewards Checking and earn points on debit card transactions. Your only option, however, will be to redeem a deposit into your account at a rate of 0.8 cents per point. This means that if you have accumulated 10,000 points, you will receive $80.
Interestingly, by having this account, you’ll be able to redeem all your MR points (regardless of how they’re earned) at the 0.8 CPP rate. If you have the Gold or Platinum and don’t want (or can’t get) the Schwab Platinum, then this might be a good alternative to cash out your points.
With the American Express mobile app’s chat feature, you can reach their customer service 24/7. You can also use the app to deposit checks, set up monthly American Express bill payments, send money to Venmo or PayPal users, manage your alerts and more.
Tap-and-go payments are supported with the included debit card at participating retailers. Purchase protection is available for qualifying purchases and covers accidental damage or theft for up to 90 days from the moment you use your card to make a purchase. This coverage is limited to a maximum of $1,000 per occurrence and $50,000 per account, per calendar year. There are other exclusions and nuances, so I would check out the terms PDF for details.
The Amex Rewards Checking account is competitive given the ability to earn points, minimal fees, and cash out optionality. It might make sense to wait for an intro bonus but, outside of that, it’s an easy pickup in my book.
Right now, only American Express consumer credit card holders are eligible to apply for the Amex Rewards Checking account. I think it might make sense to have it as a backup system but I wouldn’t prioritize it if you have more competitive options.
If you’re focused on interest rates, there are other checking accounts that might provide more value, especially if you’re not focused on things like FDIC insurance.
However, if your goal is to accrue as many Membership Rewards points as possible on all of your purchases, the account could be worth having to cover transactions where debit cards make more sense.
Yotta is a free prize-linked savings account where users get a base rate high-yield percentage, plus the ability to win prizes on top of that.
Inspired by the Premium Bonds program in the UK, users can make a deposit and get one recurring lottery ticket for every $25 saved.
You can withdraw your funds at any time, up to 6x per month.
Yotta is FDIC insured via Evolve Bank and Trust Bank for funds up to $250,000.
For security, Yotta uses military-grade, 256-bit AES encryption, access control, and secure processes to ensure your money is safe.
Yotta works with a third-party insurance carrier to randomly draw the lottery numbers. The insurance company is not affiliated with Yotta, and uses a state-of-the-art random number generator to draw numbers.
It's a double-blind system since the insurance company has no way to see the numbers users pick or the tickets.
In the event that there is a 10 million dollar* jackpot winner, it would be paid out by the insurance partner.
*The grand prize will be paid as a one-time, lump-sum payment of $5,800,000. This is the current present cash value of a $10,000,000, 40-year annuity.
Learn more about Yotta how it works in Mandy’s video:
Yotta is interesting because of the effective APY — right now, it’s substantially higher than other options on the market. Let’s dig into the official rules to calculate the expected value.
The expected value of a Yotta ticket (and the effective APY) depends on probability. Expected value is not a guaranteed interest rate.
For prizes above $999, payouts are split. The more people playing, the higher odds of splitting. i.e., if 2 people hit the requirement for the $1,500 prize, each would get $750 instead.
Theoretical best case = 3.36% prizes + 0.2% APY = 3.56% effective APY.
Theoretical worst case = 1.45% prizes + 0.2% APY = 1.65% effective APY.
In reality, it will be between these two numbers, depending on the tickets in play.
If 4 million weekly tickets = 2% effective APY.
If 9 million weekly tickets = 1.94% effective APY.
If 45 million weekly tickets = 1.87% effective APY.
If 450 million weekly tickets = 1.8% effective APY.
In the short term, we should reasonably expect 1.87% to 2% APY as the expected range.
We created a calculator for you to crunch the numbers and enter values.
Get a copy of the spreadsheet here: https://bit.ly/yottaev
Overall, Yotta Savings is offering one of the most competitive APY rates on the market due to the prizes. With the base interest rate on saved money, the prizes you could potentially win make it an interesting product.
The only concern is how long they can maintain the current interest rates. Will update the post if anything significant happens.
Is Chase Private Client worth having in 2020? Chase offers different tiers of banking like Premier Plus, Sapphire, Private Client, and Private Banking.
Chase Private Client is often confused with Chase Private Banking. They’re two different programs, and Chase Private Client has significantly lower minimum asset requirements.
Minimum: $10,000,000 of Investable assets*
Minimum: $250,000 of investable assets*
For Chase Private Client, this is not a hard minimum; they've been promoting this to people with $100,000 to "upgrade" to Chase Private Client.
* investable assets = cash, bank accounts, securities, liquid investments.
Qualifying personal investments include balances in investment and annuity products offered by JPMorgan Chase & Co. or its affiliates and agencies. Balances in 529 plans and certain retirement plan investment accounts do not qualify.
The intro bonus for opening a Chase Private Client account can vary based on which targeted offer you receive. We’ve seen intro bonuses range from $1,000-$2,000.
The typical requirements to earn the bonus are:
Starting on November 8, 2020, Chase will start charging $35/month for CPC accounts with balances below $150,000.
How to waive the $35 monthly fee:
No fees for:
Other benefits:
A few changes to the Chase Private Client program took place in 2019 that no longer make the account as valuable.
Negative changes:
If you’re looking for new stock trading platforms, Charles Schwab has most of the features people look for in a brokerage.
For beginners, I suggest looking into M1 Finance or Public. Both offer commission-free trading and fractional shares. Check out this post for a more in-depth review.
