Interest rates on checking accounts??

I need a quick answer on one specific thing, so if there are any actual bankers in here, please weigh in.🙂

Is there actually an interest rate for checking accounts where you get a return on the funds sitting in there? Like, if it doesn't exist by default, could we just work it into a contract with the bank?

I was digging through some stuff from Harvard Business School and found this super vague paragraph. It basically claims that while standard checking accounts never have a set interest rate, a giro account might. I don't know, it's pretty unclear.

So, look, I was just wondering how you actually calculated that KTA rate, because honestly, the way you laid it out has me feeling pretty lost here.

As for those KTA rates themselves, they aren't some vague estimate—they are absolute, hard numbers, just look at this example

A checking account is basically just an on-demand transaction account. The second you have "free" cash sitting there, the interest rate is absolutely pathetic... honestly, it's a joke. And from what I understand, you can't even sit down with your bank and haggle over those rates. You might try negotiating interest on a CD or a fixed-term savings account (though, let’s be real, even if you manage to strike a "great" deal, it’s still barely worth the effort in my book)

Besides, which kind of checking account are we even talking about here... is this for individuals or corporations? Not that it makes much of a difference in the end

Mark Sullivan62 thanks for the link.
So, interest on savings accounts is 0.15% and checking is 0.25%? I guess you don't get much of anything there. Real thrilling.
Kimberly Nguyen, I was talking about personal savings accounts.

One more thing: My contract says my entire scholarship gets automatically moved from my savings to my checking account the second it hits. Is it better to just leave some of it sitting in savings, or does it even matter??

Arthur Bailey6 said:Mark Sullivan62 thanks for the link.
So, interest on savings accounts is 0.15% and checking is 0.25%? I guess you don't get much of anything there. Real thrilling.
Kimberly Nguyen, I was talking about personal savings accounts.

One more thing: My contract says my entire scholarship gets automatically moved from my savings to my checking account the second it hits. Is it better to just leave some of it sitting in savings, or does it even matter??

It makes absolutely zero difference... though you might snag slightly higher interest rates on certain checking accounts if you're lucky.

Look, if the bank you're using issues cards that let you pull cash from ATMs and pay at retailers via POS terminals, then honestly, who cares? It's all one big pool.
But if they don't offer that kind of flexibility, then setting up that automatic transfer to your checking account is definitely your best bet.🙂

Yeah, just be careful there, you don't want to end up sliding into a negative balance or something like that,

because if you leave that account sitting at zero, and then Chase—or whatever bank you're using—decides to hit you with their monthly service fee or quarterly maintenance charge, they won't have anything to pull from, and that’s exactly how you run into trouble with overdrafts or frozen accounts later on.

Just go ahead and ask your banker if they slap any fees on those specific types of accounts.

And honestly, what Mark Sullivan62 is telling you is solid advice; just set up an automatic transfer to move some cash over from your checking to your savings... it's way easier to manage everything through a standard checking account than messing around with a specialized account.