Colossal Checking Does Not Pay Interest

Colossal Checking, offered by Axos Bank, does not pay interest on the balance you keep in the account. It is a checking account, not a savings account, and checking accounts at Colossal and nearly every other bank are structured to hold money for spending and bill payments rather than to grow it.

If you are looking for interest income on your deposits, you would need to move money into a separate savings product. Axos Bank does offer a savings account alongside Colossal Checking, but the two accounts are separate, and you have to choose where each dollar goes.

Key Takeaways

  • Colossal Checking pays zero interest; it is designed for spending and payments, not for saving money to earn returns.
  • Axos Bank offers a separate savings account that does pay interest, but you must transfer money from checking into savings to earn it.
  • Interest rates on savings accounts change frequently and vary by bank, so the rate Axos offers today may differ from what it offers next month.
  • If you want interest on money you might spend soon, a money market account or high-yield savings account may work better than either checking or traditional savings.

Why Checking Accounts Don't Pay Interest

Banks use checking accounts as transaction accounts. You deposit money, write checks, use a debit card, set up automatic bill payments, and withdraw cash. The account is built for movement, not storage. Because money flows in and out constantly, banks cannot reliably lend it out or invest it the way they do with savings deposits that sit untouched for months.

Some banks have tried to offer interest-bearing checking accounts, but the rates are typically very low—often under 0.01 percent annually—because the bank cannot count on holding the money long enough to make lending it worthwhile. Colossal Checking does not attempt this; it straightforward offers no interest.

How Colossal Checking Competes Without Interest

Colossal Checking attracts customers through other features instead. The account has no monthly maintenance fee, no minimum balance requirement, and no limit on the number of transactions you can make. You get a debit card, online banking, mobile app access, and the ability to deposit checks by phone camera.

For someone who wants a straightforward checking account without fees or restrictions, these features matter more than interest would. But if you have money sitting in checking that you do not plan to spend for weeks or months, leaving it there earns you nothing while it could earn something elsewhere.

Moving Money to Axos Savings for Interest

If you have Colossal Checking and want to earn interest on some of your balance, you can open an Axos savings account. The two accounts are linked through the same online banking portal, so transferring money between them takes one or two clicks.

The interest rate on Axos savings accounts changes based on market conditions and the bank's own decisions. You would need to check the current rate on Axos's website or call the bank directly, because rates are not fixed and vary over time. Once you move money into savings, it earns interest daily and compounds monthly, but you cannot spend it with a debit card the way you can with checking.

Alternatives If You Want Interest on Spending Money

If you want to earn interest on money you might need to access quickly, a money market account is worth considering. Money market accounts typically pay higher interest than savings accounts and often come with a debit card or check-writing ability, blurring the line between checking and savings. However, they usually have higher minimum balance requirements and may limit the number of withdrawals per month.

Another option is to keep a small amount in Colossal Checking for regular spending and bills, then keep the rest in a high-yield savings account at Axos or another bank. You transfer money from savings to checking as needed. This approach takes slightly more planning but maximizes the interest you earn on money you are not spending when ready.

What Happens to Interest Rates Over Time

Interest rates on savings products are not permanent. When the Federal Reserve raises or lowers its benchmark rate, banks adjust the rates they offer on savings accounts, money market accounts, and certificates of deposit. A rate that is competitive today may be lower than what other banks offer six months from now.

If you open an Axos savings account, check the rate periodically. If another bank's savings account starts paying significantly more, you can move your money. There is no penalty for closing a savings account and moving your balance elsewhere, though you should confirm that the new bank does not have a minimum balance requirement you cannot meet.

Frequently Asked Questions

Can I earn interest if I keep a large balance in Colossal Checking?

No. Colossal Checking pays zero interest regardless of how much money you keep in it. The account structure does not change based on balance size. If you want interest, you must move money into a savings product.

Does Axos Bank charge a fee to transfer money from checking to savings?

No. Transfers between your Colossal Checking and Axos savings accounts are free and happen when ready through online banking. You can move money back and forth as often as you need.

What is the current interest rate on Axos savings accounts?

Rates change frequently and depend on market conditions. You can find the current rate on Axos's website or by calling their customer service. Rates vary by account type, so confirm which savings product you are looking at.

If I need the money in my savings account, how long does it take to get it back to checking?

Transfers between Axos accounts happen when ready. If you need to move money to a different bank, it typically takes one to three business days, depending on the receiving bank's processing time.

Are there other banks that offer interest on checking accounts?

A few banks offer checking accounts with interest, but rates are usually very low—under 0.05 percent annually. Most people earn more interest by keeping savings in a separate high-yield savings account than by using an interest-bearing checking account.