A premium checking account, often referred to as a Cadillac checking account, has many benefits. Although this type of account is not beneficial to everyone, for those that use a variety of financial products, it can be a great money saver. In addition, it can make your personal finances much easier. The following are three ways that this type of checking account can benefit you.
These accounts are essentially free
Although it is true that banks will advertise flat, monthly fees for these accounts, they are only in place to make sure that those with lesser financial means do not attempt to use them. Banks are willing to provide free checking to those who are willing to maintain larger than average balances in their accounts. For this reason, they will require a minimum monthly balance to qualify for a free premium checking account. Some institutions will expand this to be a minimum balance of a combined checking and savings account, and still others will include certain securities that are purchased through the bank to reach a minimum account balance requirement.
Various miscellaneous fees are waived
There are a variety of fees that banks will levy against customers these days that can be irritating to those with lesser financial means, but with a premium checking account, fees become rare. The list is long and dependent upon a particular bank's premium checking account product, but examples include fees waived for using out-of-network ATM machines, overdraft fees, wire transfers, money orders, traveler's checks, cashier's checks, stop payments and other items that a typical bank customer must pay for.
Discounts and perks for other banking products are available
Common to most banks is earning interest on your checking account balance. Even banks that offer interest on checking accounts lower on the tier of checking account products will offer higher interest rates for the premium checking account holder. In addition, some banks will offer higher interest rates for savings accounts that are tied to the premium checking account. Other perks include lower interest rates for mortgages and car loans, higher interest rates for money market funds and discounts for safety deposit boxes.
Some of the benefits of a premium checking account will not be as attractive as others, so it is important to get a list of these benefits from each bank you may want to do business with and choose the bank that has the best package for your personal finances. If you use a variety of banking products, this type of checking account will be beneficial to you.