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Fall 2003 Checking Account Pricing Study:
key findings
By Bankrate.com
Fees are up. It costs more to open an account. Interest
rates are so low they aren't worth chasing.
 Those
are some of the key findings of the Fall 2003 Checking Account Pricing
Study, Bankrate.com's semiannual look at the consumers' must-have
banking account. The findings are based on checking account data
Bankrate researchers gathered on 490 accounts from the top 10 institutions
in the 25 largest markets. The study includes one interest-paying
and one noninterest checking account from each institution, wherever
available. The accounts selected are the ones that can be opened
for the lowest minimum deposit. The study also includes 29 online
accounts from 18 institutions.
Here's a look at the key findings:
Average
yield: Previous studies have shown that
interest-bearing accounts aren't worth it, and the current low-interest
rate environment hammers home that point. The average checking account
yield has fallen to an all-time low of just 0.27 percent -- exactly
one-fifth the rate that was being given to consumers five years
ago.
Average minimum to
open interest-bearing account: If you
want to have an account that pays interest, be prepared to fork
over more money to open the account. The minimum to open and earn
interest is up to $495. Five years ago, it was $347. This is the
first of two ways that interest-bearing accounts force you to tie
up more money to earn little benefit. The other is that you must
keep more money in the account to avoid monthly fees on interest-bearing
checking accounts.
Average minimum
to open noninterest account: Forgo that
pittance of an interest rate and you can open an account for far
less. The average minimum to open a noninterest checking account
is $59.49 -- less than an eighth of the average cost to open an
interest-bearing account.
Average minimum
to avoid fees in interest account: You
have to park a lot of money to earn interest and avoid monthly fees.
Bankrate's survey finds
you have to keep $2,258 tied up in an interest-bearing account to
avoid being dinged by
monthly fees. That's up sharply in the past
year -- in the fall of 2002, the service-charge cutoff amount was
$392 lower.
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