What is the minimum bonus that would entice you to open a new bank or brokerage?
-
- Posts: 194
- Joined: Sun Jan 01, 2023 8:11 am
What is the minimum bonus that would entice you to open a new bank or brokerage?
I've seen posts from people who chase bank and brokerage bonuses, but I'm curious what is the minimum for you to make it worthwhile?
It seems like quite a bit of work to open a new account, deal with the paperwork at tax time, etc. Are there bigger bonuses to be had, or are people content going through all of the hassle for $500-$1,000 a year?
It seems like quite a bit of work to open a new account, deal with the paperwork at tax time, etc. Are there bigger bonuses to be had, or are people content going through all of the hassle for $500-$1,000 a year?
-
- Posts: 77
- Joined: Sat May 25, 2024 10:36 pm
Re: What is the minimum bonus that would entice you to open a new bank or brokerage?
I'm nearing completion for my first attempt: $900 on $15,000 at Chase for 3 months. In my mind, that's 6% yield for ~4 months, so 18% annual. That's worth it, I guess? But given how much my retirement accounts fluctuate day to day in the market, I'm not sure if it's worth the hassle like you said. However, there are people on here getting 10K returns yearly so YMMV.
Re: What is the minimum bonus that would entice you to open a new bank or brokerage?
At this point I've done them all and my portfolio is larger, I'd need something substantial (or very low effort) to bite. Reality is if I'm bored and can get a few hundred for pushing some buttons, I'd probably still do it.
Re: What is the minimum bonus that would entice you to open a new bank or brokerage?
1%/yr.hold, no limit (i.e. if it's limited to a $10k deposit then the actual dollar value is small)
Re: What is the minimum bonus that would entice you to open a new bank or brokerage?
It varies depending on bonus type.
The tax paperwork for a bank account bonus is minimal. It's just one more interest line on the tax return. Brokerage bonuses shouldn't be that much either unless you have to make trades, though unfortunately there is also some risk of them failing to track transferred cost basis.
In terms of absolute bonus amounts, some brokerage transfers have offered multiple thousands, though usually they required a large transfer amount. A couple years ago Public offered $2,000 for a $100,000 taxable deposit, and more recently Robinhood offered 3% on IRA transfers. In terms of percentage yield, checking account bonuses can be very high -- you might get $400 just for setting up direct deposit, which might well be 25% of the peak balance, which would stay in there for much less than a year.
There might be additional hassle involved if you have to repeatedly complain to get them to pay out the bonus as promised. Also there can occasionally be difficulties with closing an account.
The tax paperwork for a bank account bonus is minimal. It's just one more interest line on the tax return. Brokerage bonuses shouldn't be that much either unless you have to make trades, though unfortunately there is also some risk of them failing to track transferred cost basis.
In terms of absolute bonus amounts, some brokerage transfers have offered multiple thousands, though usually they required a large transfer amount. A couple years ago Public offered $2,000 for a $100,000 taxable deposit, and more recently Robinhood offered 3% on IRA transfers. In terms of percentage yield, checking account bonuses can be very high -- you might get $400 just for setting up direct deposit, which might well be 25% of the peak balance, which would stay in there for much less than a year.
There might be additional hassle involved if you have to repeatedly complain to get them to pay out the bonus as promised. Also there can occasionally be difficulties with closing an account.
-
- Posts: 4548
- Joined: Thu Apr 23, 2020 12:44 pm
Re: What is the minimum bonus that would entice you to open a new bank or brokerage?
I made probably a few thousand dollars in 2023 with bank bonuses. Seemed worth it for a few hours of time at most.
Didn't do any in 2024 because I knew I would be buying a house and didn't want all of the new accounts on my credit score to affect underwriting.
At this point, I don't know if I'll bother. It's typically easy money because it's minimal effort and time to get things set up, but I just don't have the desire or energy to do it.
But, I'd say try a few out and see if it's something you find worthwhile.
Didn't do any in 2024 because I knew I would be buying a house and didn't want all of the new accounts on my credit score to affect underwriting.
At this point, I don't know if I'll bother. It's typically easy money because it's minimal effort and time to get things set up, but I just don't have the desire or energy to do it.
But, I'd say try a few out and see if it's something you find worthwhile.
- lthenderson
- Posts: 9448
- Joined: Tue Feb 21, 2012 11:43 am
- Location: Iowa
Re: What is the minimum bonus that would entice you to open a new bank or brokerage?
It depends.
If it is a bank account I already have open and can just do the transfer from a similar bank - even $100 may be worth it. (I used to move money between Ally and GS/Marcus and back evey year and sweep up 1% bonuses at each place within the same year - they seemed to stop those programs. It was quick money with little effort).
If I need to move millions from one brokerage to another (where I don't have an account and I am not sure I trust) and risk losing cost basis tracking and risk other issues, $1000 is not worth it.
If it is a bank account I already have open and can just do the transfer from a similar bank - even $100 may be worth it. (I used to move money between Ally and GS/Marcus and back evey year and sweep up 1% bonuses at each place within the same year - they seemed to stop those programs. It was quick money with little effort).
If I need to move millions from one brokerage to another (where I don't have an account and I am not sure I trust) and risk losing cost basis tracking and risk other issues, $1000 is not worth it.
Re: What is the minimum bonus that would entice you to open a new bank or brokerage?
I used to do it, not because of the money but because I was interested in banking and banking systems and I enjoyed messing around with different accounts, banks and interfaces. The money was mostly meaningless. Now that I have a surfeit of accounts and experience I don't bother for SUBs. I will, however, open an account with a bank that looks interesting or weird. Recently opened accounts with "Upgrade" and "Golden 1 Credit Union" just because I thought they looked funky.
50-year-old California bankruptcy attorney
Re: What is the minimum bonus that would entice you to open a new bank or brokerage?
I just got this $1500 offer (I think I have the details right):
Capital One (I use Cap One QS CC card so maybe that's why I was offered it?)
Open cash account (pays 3.8%)
Then fund with $100K
Hold 90 days (IIRC, from the funding deadline, which is in turn ~15 days after the open, so really I *think* the money needs to be there from days ~16 through ~105)
Then I guess I could pull *most* of the cash out
And sometime thereafter (30-60 days?) they add $1500 to the account
Then I would presumably close it.
That's a *lot* of touches to make this work (open, wait a bit and fund ~15 days later, pull most funds ~91 days after that, pull remaining funds (with bonus) and close it ~30-60 days later, also probably need to do some "pushing" on the money from wherever the cash is coming, also need to handle the tax details of all this).
Then deduct some for the slightly sub-par rate (3.8% fully taxable vs. ~4.2-4.3% that's federally taxable but state tax free in a t-bill or fed MM account, plus I don't really want to tie up $100K for 3.5 months anyways right now (I try to keep my cash balances low and this isn't much of an emergency fund if I can't really pull the money out for ~3.5 months).
Bottom line, I calculate that this $1500 bonus turns into ~$550-$940, after tax, once I adjust for the taxes themselves and better (absent the bonus) alternative investments. And to realize that ~$550-$940 bonus, I have to make something like 6 touches to this account or other accounts, taxes, etc. Have to have good calendar reminders that I don't miss out on, etc. It's a lot of work for a not very big bonus, even though the "face value" of the bonus seems high and simple ($1500!)
I think I'm gonna pass, but haven't entirely committed.
I have not claimed brokerage transfer bonuses for myself (other than free trades MANY years ago), nor much in the way of CC/bank bonuses (occasional sign-up bonuses for CCs I wanted anyways). I dunno - I do read some of the threads on BH and the offers, and tell myself it's ~free money, but it really isn't (time/complexity).
Plus there's a little bit of "picking up nickels in front of steamrollers" aspect to it. What if I transfer taxable brokerage assets and the basis gets lost, or they're inadvertantly sold (realizing cap gains) somewhere along the way, or whatever? Chances of that probably small-ish, but not zero...
Capital One (I use Cap One QS CC card so maybe that's why I was offered it?)
Open cash account (pays 3.8%)
Then fund with $100K
Hold 90 days (IIRC, from the funding deadline, which is in turn ~15 days after the open, so really I *think* the money needs to be there from days ~16 through ~105)
Then I guess I could pull *most* of the cash out
And sometime thereafter (30-60 days?) they add $1500 to the account
Then I would presumably close it.
That's a *lot* of touches to make this work (open, wait a bit and fund ~15 days later, pull most funds ~91 days after that, pull remaining funds (with bonus) and close it ~30-60 days later, also probably need to do some "pushing" on the money from wherever the cash is coming, also need to handle the tax details of all this).
Then deduct some for the slightly sub-par rate (3.8% fully taxable vs. ~4.2-4.3% that's federally taxable but state tax free in a t-bill or fed MM account, plus I don't really want to tie up $100K for 3.5 months anyways right now (I try to keep my cash balances low and this isn't much of an emergency fund if I can't really pull the money out for ~3.5 months).
Bottom line, I calculate that this $1500 bonus turns into ~$550-$940, after tax, once I adjust for the taxes themselves and better (absent the bonus) alternative investments. And to realize that ~$550-$940 bonus, I have to make something like 6 touches to this account or other accounts, taxes, etc. Have to have good calendar reminders that I don't miss out on, etc. It's a lot of work for a not very big bonus, even though the "face value" of the bonus seems high and simple ($1500!)
I think I'm gonna pass, but haven't entirely committed.
I have not claimed brokerage transfer bonuses for myself (other than free trades MANY years ago), nor much in the way of CC/bank bonuses (occasional sign-up bonuses for CCs I wanted anyways). I dunno - I do read some of the threads on BH and the offers, and tell myself it's ~free money, but it really isn't (time/complexity).
Plus there's a little bit of "picking up nickels in front of steamrollers" aspect to it. What if I transfer taxable brokerage assets and the basis gets lost, or they're inadvertantly sold (realizing cap gains) somewhere along the way, or whatever? Chances of that probably small-ish, but not zero...
Re: What is the minimum bonus that would entice you to open a new bank or brokerage?
A 1% bonus (with no upper limit) would probably get me interested. $10K for every $1M
+1 I hate to mess around with things when everything is working. But I'll take reasoned risk if the reward is great enough.GoldStar wrote: Mon Feb 03, 2025 10:48 am ...If I need to move millions from one brokerage to another (where I don't have an account and I am not sure I trust) and risk losing cost basis tracking and risk other issues, $1000 is not worth it.
The closest helping hand is at the end of your own arm.
Re: What is the minimum bonus that would entice you to open a new bank or brokerage?
I did one at Chase last year bc the bonus seemed pretty good. After I closed the accounts, I decided I would never do it again. First, the amount "after taxes" makes it much less interesting. Second, usually these bank bonuses require a monthly direct deposit. That's a pain moving my SS deposit from one place to another, then moving it back again. Between the initial setup, changing my direct deposit, then closing the account while making sure I complied with all the fine print is way too much effort.
Having said the above, I recently got an offer from a local bank that, at first blush, caught my interest. Luckily, I called the bank to make sure I knew all the "fine print" details. Good thing I did. You had to open the account at a specific branch - one some distance away, not the one 5 minutes away. Then you had to set up a direct deposit. And finally, you had to use a debit card several times a month. I don't use a debit card, I'm not about to drive to another branch, and I don't want to change my SS deposit. So no dice. Happy to leave well enough alone.
Having said the above, I recently got an offer from a local bank that, at first blush, caught my interest. Luckily, I called the bank to make sure I knew all the "fine print" details. Good thing I did. You had to open the account at a specific branch - one some distance away, not the one 5 minutes away. Then you had to set up a direct deposit. And finally, you had to use a debit card several times a month. I don't use a debit card, I'm not about to drive to another branch, and I don't want to change my SS deposit. So no dice. Happy to leave well enough alone.
The difficulty with jazz is there are too many notes. (Borrowed from Emperor's critique in Amadeus)
Re: What is the minimum bonus that would entice you to open a new bank or brokerage?
I also got the offer directly as a Capital One credit card holder, although it's available to anybody who doesn't already have a Captial One savings account and hasn't had one recently.psteinx wrote: Mon Feb 03, 2025 9:54 pm I just got this $1500 offer (I think I have the details right):
Capital One (I use Cap One QS CC card so maybe that's why I was offered it?)
I agree with much of your analysis (that funds need to sit there between days 16-105) and that I am thus losing a quarter's worth of interest at Cap One at a rate which is effectively around 0.7% worse than a MM rate. So for $100k it's $175 in lost interest for a $1500 (before tax) bonus. Due to the lost interest it's not as good a deal as the ones that merely involve moving equities around but it my case I looked at it as an existing Cap One cardholder and went for it. Opening the account under my existing login was extremely low-friction, and they've got $50k of operating cash that I can do without for 90 days. (FWIW the reports on DoC about this offer suggest that while they say to allow 60 days for the bonus to pay out it's usually under a week.) For me, I deal with enough financial stuff regularly anyway that having some dated items on my to-do list is no big deal, again another personal aspect.
As in most such cases, it's still available as an emergency fund--if it's enough of an emergency, I can still pull the money and the fact that I'm going to lose a bonus is not going to matter.
To answer the original question, it ultimately depends how much of a pain in the butt it is. As another example the $2500 Wells Fargo Premier offer is in some ways very easy to execute (they can hold some long-term VTI for me for a while, sure), but needing the branch visit is annoying. The payoff was good enough to do it, though, and having it give me access to better money market funds at Fidelity that otherwise have a $10M minimum to get into was a nice perk that may have pushed me over. I consider starting business with a completely new institution to be a fairly large and annoying step, but I don't care at all about one 1099 more or less at tax time, bonus payouts have an extremely straightforward tax treatment.
-
- Posts: 1
- Joined: Sun Jan 19, 2025 12:05 am
Re: What is the minimum bonus that would entice you to open a new bank or brokerage?
I recently started doing this and will keep it going in 2025 with these rough guidelines:
- online only (no going into a branch or sitting through a sales pitch)
- no accounts with fees that I have to work around. if an account has a monthly fee that's waived with a minimum balance or other stipulations, I'm out
- 1.5% minimum bonus on brokerages, no minimum on bank bonuses (see below)
- I'll prioritize an easy bank bonus for less $$ over one with more hoops for a higher bonus
- I'm in a state with high income tax so I also check to make sure the cash I need for the offer won't compromise the bonus via lost tax-exempt gains elsewhere (detailed below by @psteinx)
If I want to stop doing this at any time I can just stop and keep all my existing accounts, without having to unravel the whole thing.
- online only (no going into a branch or sitting through a sales pitch)
- no accounts with fees that I have to work around. if an account has a monthly fee that's waived with a minimum balance or other stipulations, I'm out
- 1.5% minimum bonus on brokerages, no minimum on bank bonuses (see below)
- I'll prioritize an easy bank bonus for less $$ over one with more hoops for a higher bonus
- I'm in a state with high income tax so I also check to make sure the cash I need for the offer won't compromise the bonus via lost tax-exempt gains elsewhere (detailed below by @psteinx)
If I want to stop doing this at any time I can just stop and keep all my existing accounts, without having to unravel the whole thing.
Re: What is the minimum bonus that would entice you to open a new bank or brokerage?
"I don't use a debit card"JazzTime wrote: Tue Feb 04, 2025 8:40 am I did one at Chase last year bc the bonus seemed pretty good. After I closed the accounts, I decided I would never do it again. First, the amount "after taxes" makes it much less interesting. Second, usually these bank bonuses require a monthly direct deposit. That's a pain moving my SS deposit from one place to another, then moving it back again. Between the initial setup, changing my direct deposit, then closing the account while making sure I complied with all the fine print is way too much effort.
Having said the above, I recently got an offer from a local bank that, at first blush, caught my interest. Luckily, I called the bank to make sure I knew all the "fine print" details. Good thing I did. You had to open the account at a specific branch - one some distance away, not the one 5 minutes away. Then you had to set up a direct deposit. And finally, you had to use a debit card several times a month. I don't use a debit card, I'm not about to drive to another branch, and I don't want to change my SS deposit. So no dice. Happy to leave well enough alone.
I have never used one in my life and don't plan to. So that is always the end of any offer that would require me to use one. Plus, I don't think I'd even have enough opportunities in a month to use one the number of times they require you to use one.
Above provided by: Vinny, who always says: "I only regret that I have but one lap to give to my cats." AND "I'm a more-is-more person."
Re: What is the minimum bonus that would entice you to open a new bank or brokerage?
While I've done a lot of things for credit card bonuses, I have done very few bank/brokerage signup bonuses. Years ago I did one for chase which worked but it just seems like a lot of work and possible frustration. And with brokerage bonuses you are often talking about a sizable amount to move around and with all of the fraud, I just don't want to risk it for $1,000 or so.
Chase has a bonus where you can get $900 for not a lot of effort that I've considered but I don't need a chase account and haven't done it, yet. Also many of these bonuses aren't as great when you consider how much money you might have to keep for 90 days at near zero interest compared to locking it up in a treasury. It is more money but not sizable enough to move the needle.
Chase has a bonus where you can get $900 for not a lot of effort that I've considered but I don't need a chase account and haven't done it, yet. Also many of these bonuses aren't as great when you consider how much money you might have to keep for 90 days at near zero interest compared to locking it up in a treasury. It is more money but not sizable enough to move the needle.
----------------------------- |
If you think something is important and it doesn't involve the health of someone, think again. Life goes too fast, enjoy it and be nice.