8 Ways To Grow the Money in Your Checking Account in March
Having a checking account is a convenient way to keep your money safe and accessible for everyday bills and expenses. The main downside with traditional checking accounts is that many don’t offer what savings accounts do — and that’s interest on your money so it can grow.
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The good news is that you can still keep your money handy while watching it grow. Here’s how to go about it this month and beyond.
Use a High-Yield Checking Account
Some checking accounts offer interest, which is sometimes comparable to what you’d get with an APY savings account.
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“I suggest high-yield checking accounts, specifically at community banks and credit unions because some are offering rates as high as 6%,” said Gabe Krajicek, CEO of Kasasa. “Community banks and credit unions can offer higher yield accounts and lower interest rates because they operate on a smaller scale with lower overhead costs, are member-owned and/or community-focused, and built on relationships that take a whole person approach to banking.”
Set Spending Limits
Check your checking account to see if it has any daily or monthly spending limits. Many do, but if yours doesn’t, consider setting your own.
US Bank, for example, lets you set daily spending limits from your online account. These limits include ATM withdrawals and debit card or digital purchases. You can change or update your spending limits at any time based on your needs and priorities.
Look for Ways To Avoid Fees
Some financial institutions charge monthly maintenance or annual fees to keep your money in a checking account with them. These fees can add up and cut into any interest your money might have otherwise earned.
To avoid this and help your money grow as intended, look for a bank or credit union that doesn’t charge any fees–or that has waivable fees you can keep up with.
“Now is a great time to search; there are community banks and credit unions that offer accounts with no minimum balance requirements to earn rewards, no monthly maintenance fees, nationwide ATM fee refunds, and free high-yield checking accounts — many greater than 5%!” said Krajicek.
Create a Budget
“One of the first steps to take to grow the money in your checking account is to create a budget. This is essentially your roadmap to spending less and saving more,” said Ben Alvarado, executive vice president director of Core Banking of California Bank & Trust. “It’s the simplest way to keep track of the money you have coming in and what you are spending.”
Once you have this visibility, Alvarado said, you can start adjusting your spending and savings habits. And if you’re new to budgeting, don’t worry–there are plenty of tools to make it easier.
“A practical way to do this is by signing up for a budgeting tool or creating one in a spreadsheet,” said Alvarado. “That way, you can adjust the way you spend as needed.”
Keep Increasing Your Income
This one might seem obvious, but increasing your income is a great way to boost your overall checking account balance. Plus, if you set up direct deposit for your extra income, it can go directly into your account without you ever having to worry about it.
“If you need more cash, get a side hustle. The more income you bring in, the easier it is to grow the money in your checking account,” said Brittany Pedersen, director of deposit and payment operations at Georgia’s Own Credit Union.
Get a Certificate of Deposit
Certificates of Deposit, or CDs, typically earn more interest than checking or savings accounts. The drawback is that your money becomes inaccessible until the CD matures — or expires.
“If you have extra money to save, CDs can be a great option for growing your money — especially in the high-rate environment we have been experiencing over the past couple of years,” said Alvarado. “Putting your money into a CD will allow you to earn a fixed interest rate for a period of time…It’s important to fully understand the terms of your CD before locking up your money.”
Use Cash
If you keep some cash on hand, you can use it instead of your checking account balance to pay for daily expenses. This keeps the money in your account where it is so the interest can continue to grow, but it also has other benefits.
“By paying with cash, you can better manage what you spend,” said Pedersen. “It also helps reduce impulse purchases, which can make unexpected dents to your checking account.”
Automate Your Savings
You can keep the majority of your money in your checking account, but if you want it to grow more quickly, you might want to allocate some of it toward your savings. Set up automatic withdrawals and set aside a certain amount of your paycheck each month. It’ll go directly into your linked savings account without you having to worry about it.
Even if some of the money is in your savings account, it will still be readily accessible in case you need it for something later. But it will also be less tempting to use.
“A high-yield savings account is flexible, meaning that if you think you are going to need your funds accessible, it would allow you to withdraw your funds at any time without penalties while still earning a return,” said Alvarado.
You can always change your savings contributions, or switch from automatic to manual deposits.
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