Free money from Webull

[baconschteam]

Webull wants to pay me a good chunk of money to move my brokerage and my emergency fund to them (from Chase). Currently, they will give me a 2% bonus on any new brokerage money, and a 2.5% bonus on cash (7.5% total) for 180 days, after which time the interest on the cash would drop down to 5%.

In total, based on the money I would be moving, they would be giving me around $5k. They one tangible downside to moving the money from Chase would be losing “private client” status, but this doesn’t actually provide much benefit, aside from them paying a little more attention to me. Another possible downside is that in order to get the bonus I would need to keep my money parked there for at least two years (or something like that). This doesn’t sound terrible, unless there’s some unpleasant thing about Webull that I’m not aware of.

Any thoughts on this? This could potentially be a month of income for me for free. Does anybody know if it is taxable as income or capital gains?

Also, if this post inspires anybody to sign up for Webull please use the following link and we will both get a bonus:
https://a.webull.com/NwcteBJBPMHRhH0Ad0
If this breaks some forum policy I’ll gladly take it down.

[ChpBstrd]

Some questions:

• Was this offer received via email or something? It's not on https://www.webull.com/offers-promotions .
• Is this cash to be put in a MM fund or simply held by this fintech firm as a loan to them? FDIC insurance?
• Is the money sufficiently accessible to still serve as an e-fund?
• This rate is for cash only, right? You cannot invest in anything, right?
• There are no guarantees of the year 2 or 3 interest rates, right? So it could be 0% after year 1? If so, iBonds at 1.3% fixed plus inflation (now 4.28% total), state-tax-free, offer a compelling alternative.
• I'm unclear about the bonus/interest rate. Are you saying it's 7.5% interest for 180d, then 5% for the rest of the year, then an unknown rate beyond 1 year?
• How much interest do you forfeit for early withdraw?
• How does this e-fund configuration compare to holding a couple of 2% cash back credit cards plus a lower yielding treasury bond that you could sell to pay the CC bill before it earned interest? E.g. in a $20k emergency one year from now, you put it all on credit, earn $400 in cash back for doing so, then sell your treasury bond or fund to pay the bill a month later, which had been earning ~4%, while forfeiting no interest. Your e-fund configured this way essentially "earns" ~6% if an emergency happens, which may be more than the weighted average interest rate earned through webull.

[baconschteam]

Looks like the offer is only in the app. Screenshots attached

[baconschteam]

Here’s the brokerage offer:

[baconschteam]

Some questions:

• Was this offer received via email or something? It's not on https://www.webull.com/offers-promotions .
• Is this cash to be put in a MM fund or simply held by this fintech firm as a loan to them? FDIC insurance?
• Is the money sufficiently accessible to still serve as an e-fund?
• This rate is for cash only, right? You cannot invest in anything, right?
• There are no guarantees of the year 2 or 3 interest rates, right? So it could be 0% after year 1? If so, iBonds at 1.3% fixed plus inflation (now 4.28% total), state-tax-free, offer a compelling alternative.
• I'm unclear about the bonus/interest rate. Are you saying it's 7.5% interest for 180d, then 5% for the rest of the year, then an unknown rate beyond 1 year?
• How much interest do you forfeit for early withdraw?
• How does this e-fund configuration compare to holding a couple of 2% cash back credit cards plus a lower yielding treasury bond that you could sell to pay the CC bill before it earned interest? E.g. in a $20k emergency one year from now, you put it all on credit, earn $400 in cash back for doing so, then sell your treasury bond or fund to pay the bill a month later, which had been earning ~4%, while forfeiting no interest. Your e-fund configured this way essentially "earns" ~6% if an emergency happens, which may be more than the weighted average interest rate earned through webull.

1. See screenshots I posted above^^ - The offer is only in the app
2. This is cash in the "settled money" account. I suppose this may be a MM fund? Like how settled Vangaurd funds are automatically placed in VMFXX. But I don't see the specific mechanics of this listed. It does state that the money is FDIC insured.
3. The money can be withdrawn in full at any time. The offer will only apply to the cash account if money is kept there for 30 days. The offer will only apply to the brokerage account if the full amount is left invested for 2 years.
4. There are two separate offers here. One is for transferring in money to a brokerage account (2% bonus). The other is a cash account (7.5% interest for 180 days and 5% thereafter, subject to change).
5. Correct that there are no guarantees on the interest rates. But there is also no obligation to keep the cash with Webull after the offer is fulfilled. I could have the e-fund parked here growing at 7.5% for 180 days and then switch it to something else such as iBonds at that time if it makes sense to.
6. See number 4 above
7. For both offers, you forfeit the bonus if you withdraw early
8. I am already doing this with a 0% apr credit card offer (0% until 4/25), planning on paying it back from the e-fund when due. Doing this with a Shop Your Way Mastercard which is earning me something like 10% back since it has all kinds of weird stackable offers they keep sending me.

[ChpBstrd]

Sounds like a reasonable deal, though it will probably end and start paying 0% interest at some future time when rates are lower and you have fewer options for reinvestment. The interest rate averages out to a little over 6.25% over the course of 12 months by my napkin math. So that beats CDs, MMFs, and treasuries.

You could alternatively buy something like agency bonds yielding just over 6% or A-rated corporate bonds yielding almost 6%, but these are mostly callable, have lots of duration risk if rates rise, and have some minor level of default risk. What you'd get in exchange is the possibility of higher yields than is available in the market for years 2 and beyond. IDK if all that risk is compatible with the idea of an e-fund. So the brokerage offer looks good in comparison.

The 2% transfer to brokerage offer looks really good compared to other brokerages. Too bad it only applies to taxable accounts. Worth noting there is zero charge for inbound stock transfers, buy $75 for outbound.

Overall a good looking deal.

How did you manage to move CC debt into this account without a cash advance fee or check-to-self fee?

[baconschteam]

How did you manage to move CC debt into this account without a cash advance fee or check-to-self fee?

Thanks for picking at the numbers a bit.

For the CC, I've just been putting all my expenses on the one 0% apr card for the past few months while only making the minimum payments. This has added up to a nicely growing pile of extra cash that I've thus far had parked in VMFXX.