The H-E-B Debit Card is a prepaid debit card that offers an FDIC-insured savings account with 6% interest on your first $2,000. When used correctly, it comes with no fees and is an excellent place to store extra cash.
The H-E-B Debit Card is one of several mega-high-yield savings options where you can earn much more than what you could earn in a regular savings account (the other options include Netspend, Digital Federal Credit Union (DCU), and Service Credit Union). When combined, most people should be able to put away $8,500 earning 5% or more interest, plus an additional $3,000 earning 3% interest. That gives every individual $11,500 earning 3% to 6% interest. If you’re a two-person household, you can have $23,000 earning 3% to 6% interest. That’s a good emergency fund for most people.
I’ve written a full overview of all of these different options in one of my most popular posts, Where To Get 5% Interest Savings Accounts. I’ve also written account-specific posts for Netspend and DCU, which you can check out below:
- Netspend Account: The Ultimate Guide to a 5% Interest Savings Account
- DCU Referral Bonus – Step By Step Guide (Plus A 6% Interest Savings Account)
Since I hadn’t written a post about the H-E-B Debit Card, I thought it’d be worth quickly writing about it. In this post, we’ll take a look at the H-E-B Debit Card, provide a brief walkthrough on how to set up your account, and go over how this account works and what you need to know about it.
What Is The H-E-B Debit Card?
The H-E-B Debit card is a prepaid debit account that is similar to the Netspend cards. What makes the H-E-B Debit Card interesting is that it’s considered a separate product from the Netspend cards. Netspend seems to limit users to 5 total accounts, but even if you have 5 Netspend accounts, you can still open an H-E-B Debit account.
The H-E-B Debit card has two parts – a debit card and an FDIC-insured savings account. We don’t really care about the debit card, but the savings account is important because it offers 6% interest on the first $2,000 you have in the savings account. Everything over $2,000 earns 0.5% interest, which is comparable to a normal high-yield savings account.
(For those that want specifics on how the interest works, the terms state that “[i]f the Average Daily Balance is more than $2,000.00, the interest rate paid on the portion of the Average Daily Balance which exceeds $2,000.00 will be .49% with an APY of .50%, and the interest paid on the portion of the Average Daily Balance which is $2,000.00 or less will be 5.87%.”)
Opening the H-E-B Debit card doesn’t require a credit check and has no impact on your credit score. And so long as you don’t use the debit card for anything and you set up some activity to avoid potential inactivity fees, the account is completely free. Interest on the savings account is paid quarterly, so you’ll receive your interest on January 1st, April 1st, July 1st, and October 1st.
$2,000 earning 6% interest comes out to $120 per year of interest. You can open one account per person, so if you’re a two-person household, you can have $4,000 in two H-E-B Debit accounts earning 6% interest without having to do anything other than set up the account and automate some bi-monthly or quarterly transfers to avoid inactivity fees.
Getting $120 of interest on $2,000 might not seem like a big deal, but consider this. A regular savings account paying 0.5% interest would pay you just $10 per year. Even a 1% interest account would only pay you $20 per year.
To get an idea of how big of a difference this is, you’d need $12,000 in a regular savings account to earn the same amount of interest as you’d get in the H-E-B Debit account. That’s a big deal in my opinion – and makes it worth taking a little bit of time to set this account up.
How To Set Up Your H-E-B Debit Card
Setting up your H-E-B Debit card is a straightforward process. First, you’ll need to go to the H-E-B Debit website, which you can find at www.hebdebit.com. Unfortunately, there is no sign-up bonus for this account, but if that ever changes, I’ll update this post.
Next, you’ll click signup and follow the directions. It’s a straightforward process. You’ll provide your information, create a username and password, and verify your identity. This is all basic stuff that you’d have to do with any bank account. Remember, there is no credit check, so opening your H-E-B Debit Card will not impact your credit score or have any impact on your credit.
Finally, once you get through the signup process, you’ll receive a message stating that your debit card is on the way. You’ll need to activate the card when it arrives to gain access to the savings account, but once you activate the card, it’s best to set it aside in a safe place and not use it. While the H-E-B Debit Card does offer 5% cash back at a few places, I still generally don’t recommend using this card. It’s just not worth using it for anything other than the savings account, in my opinion.
To activate the savings account, you’ll need to transfer money onto your H-E-B Debit Card. Once you do that, you’ll get the option to activate the savings account.
To move money onto the debit card, I recommend going to your bank’s website and linking your bank account to the H-E-B Debit account. I generally find this to be the best way to do things, but if you prefer, you can also link your external bank accounts using the H-E-B website. The H-E-B Debit account doesn’t charge fees for doing external transfers, which is in contrast to Netspend, which I believe has always charged a fee if you do a transfer using the Netspend website. I initiated a transfer via the H-E-B Debit account website and it went through without any issues.
Finally, once you’ve activated the savings account, simply transfer the money from your H-E-B Debit card to the savings account. To do that, go to your savings account, click savings transfer, and then transfer money from the debit card to the savings account. I recommend moving the full $2,000 if you can because it’s best to get your idle cash working for you as soon as possible.
As long as you don’t use the debit card, you’ll never have to worry about fees. The only fee you have to watch out for is the inactivity fee. Similar to Netspend, the H-E-B Debit account charges a monthly fee if your account has no activity for 90 days.
To avoid this issue, I recommend scheduling a bi-monthly or quarterly transfer in and out of the account. Go to whatever main bank account you want to use, then schedule a small transfer into the H-E-B debit account every 2 months ($1 or whatever the smallest amount you can transfer is ideal). If you don’t want to leave random amounts in your H-E-B debit account, you can also automate that money out of the account every 2 months.
For example, I have a Discover bank account linked to my H-E-B Debit account. I’ve scheduled it so that every quarter, Discover sends $25 to my H-E-B debit card. Then 2 weeks later, Discover automatically withdraws that same $25 back to my Discover bank account. It only took me a few minutes to set this process up, and now I don’t have to think about it.
H-E-B Debit Card Issues And Solutions
There are a few issues I had when I set up my H-E-B Debit card. Here’s what I had to deal with when I opened my account.
H-E-B Debit Account Closed After I Was Approved. The first issue was that my account was closed within a day after I opened it. I don’t know why it was approved and then closed, but I figured it was because I already had five Netspend accounts. My wife’s account also suffered the same fate, closed a day after it was opened.
Strangely, a few months later, I received a random email from H-E-B Debit saying that my account had been closed in error and that it was being reopened. I also received a $50 bonus to apologize for the inconvenience. My wife received the same email.
If you’re opening this account now, you’re unlikely to have issues with your account being opened and then closed. It seems like this was a one-off issue and that they’ve fixed the problems they had. The important thing is you can open the H-E-B Debit Card, even if you already have five Netspend accounts.
Issues Linking My Bank Account To My H-E-B Debit Card. The second issue I had to deal with was linking my bank accounts to my H-E-B Debit Card. With Netspend, I never had a problem linking my Ally checking account, but for some reason, Ally would not let me link the H-E-B Debit Card to it.
My solution was to use a different bank account. I eventually had luck linking my Discover savings account to the H-E-B Debit Card.
My wife had similar issues, where she couldn’t link it to Ally. She then tried to link it to Marcus by Goldman Sachs and that too ended up not working. Strangely, while Discover worked for me, she also couldn’t link her account to Discover. She eventually had luck with Alliant Credit Union.
If you’re unable to link the H-E-B Debit card using your bank’s website, you can also link your bank using the H-E-B Debit website. There are no fees to initiate transfers from the H-E-B Debit website. The only problem is you can’t schedule transfers, so if you want to automate transfers to avoid inactivity fees, you’ll still need to do that from your bank’s website.
The short of it is, you might have to go through some trial and error to figure out which banks will play nicely with the H-E-B Debit account.
Putting It All Together
It took me a little bit of time since I had those initial issues with my account getting closed, but I now have everything set up with my H-E-B Debit accounts. I have $2,000 in my account safely earning 6% interest. My wife has the same, giving us $4,000 earning 6% interest.
Combined with our 10 total Netspend accounts, 2 DCU accounts, and 2 Service Credit Union accounts, we currently have $23,000 between us earning 3% to 6% interest in FDIC-insured savings accounts ($17,000 earning 5% or more and $6,000 earning 3%). That’s a good emergency fund for most people.
To get additional money in savings, I’ve also turned to I Bonds, which are another savings vehicle that can be worth looking at. I’ve written a post about I Bonds that is worth checking out if you’re looking for additional safe places to store your cash.
Having an emergency fund is important. But some people don’t like the trade-off that comes with keeping cash. If you take advantage of accounts like the H-E-B Debit Card, you don’t have to make that trade-off at all.