Santander extra20 Checking Review

If you are looking to make some money on interest in a checking or savings account these days, the pickings are slim. Interest rates are still extremely low and you will be lucky to earn 1% on most accounts which will just be eaten up by inflation. Obviously this is better than earning a 0% interest rate, but it’s still not ideal. That’s where Santander extra20 Checking comes into play, where you can earn $20 a month just by having direct deposit and paying two bills each month. If you don’t feel like setting up the bill pay, you can simply earn $10 a month from the direct deposit option. I’ve been using this account for six months now, so I wanted to give you my Santander extra20 Checking Review.

In order to qualify for the account and the first $10 a month, you must have at least $1500 direct deposited into your checking each month. This doesn’t have to be a single direct deposit, you just need a total of $1500 each month in any combination. People have been successfully using ACH from another bank to achieve this goal, but many banks are now categorizing these transactions as ‘P2P’ and Santander will not see that as a direct deposit. If you do that part, that’s your first $10 a month with very little effort.

The second part is paying two of your bills online using Santander’s bill pay system. I am currently using the system to pay my insurance and one of my credit cards every month. It’s simple to set up and keep track of, and I haven’t had any issues using it. Their system is compatible with most major insurance companies, utility companies, banks, and retailers. If you have two bills paid every month using the bill pay, that will you net you another $10 a month.

For someone who already uses Santander as their bank, switching to the extra20 Checking is probably a no-brainer. You can either call or visit your local branch, and it takes about 10 minutes to switch over an existing checking account. There is no minimum amount to keep in your checking and savings accounts, as long as the extra20 checking account remains linked to the savings account. The only requirement to prevent fees is to keep $1500 direct deposit into the checking account each month.

If you don’t have Santander Bank, I still think this can be a great opportunity. You can move your direct deposit to this new account and still remain with your traditional bank if needed. If you don’t use an ATM often and live in the Northeast, you can also just use Santander as your main bank account. If you aren’t near a physical bank or rely on ATMs a lot, I would recommend keeping an automatic transfer straight to your main bank account. Because this account requires direct deposit to avoid fees, you will have to see if it’s worth it to you. Everything can be automated, but make sure you aren’t overdrafting on either of your accounts.

Effective interest rates:

  • $1000 balance in extra20 Checking and Savings: $240 a year = 24% “interest rate”
  • $2000 balance in extra20 Checking and Savings: $240 a year = 12% “interest rate”
  • $3000 balance in extra20 Checking and Savings: $240 a year = 8% “interest rate”

Since you are earning a flat $240 every year, the lower the balance you keep in these accounts the higher your “interest rate” will be. You can then put the rest of that money elsewhere so that it can earn you even more money. That’s why I think this deal is so great, it’s a flat amount that you get every month with little effort on your end after the initial set up. If you were going to put the rest of your emergency fund into an account earning 1% interest anyways, why not get another $20 on top of that?

Please be careful of the possible fees:

  • Charge of $3 to use an ATM that is not Santander, plus paying the fee that the actual ATM will charge you as well
  • If you don’t have direct deposits totaling $1500 for a month, you will have to pay a $10 fee for your checking account. If you get laid off or your company stops using direct deposit, make sure to convert or close your account!
  • The overdraft fee is $12 if Santander has to take money out of your savings account to cover your checking account. Don’t overdraft!

I first read about this option at Doctor of Credit, and then I had also read about it being used at the The Single Dollar. I had been using Santander Bank prior to this, so it was an easy account conversion for me. In this low interest environment I think it’s a solid deal.

photo credit: Santander Bank Sign Logo pics by Mike Mozart of TheToyChannel and JeepersMedia on YouTube. via photopin (license)

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2 Comments

    1. Yep, it’s really that simple. No fees if you have a direct deposit of at least $1500 a month. Then you get $10 for that and $10 more if you pay two bills each month. Better than any interest rates out there currently.

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