The Money Mustache Community
Learning, Sharing, and Teaching => Reader Recommendations => Topic started by: Reddleman on January 13, 2018, 09:52:29 AM
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My main credit card is through them, so I get offers periodically.
This one is deposit $50k and they give you $500. The interest rate is 1.4% as well, whereas my local bank is .15% on regular savings. I've seen offers like this before, but they required switching your direct deposit, which is a hassle. This one is just a deposit. The account is FDIC insured.
We keep about that much in cash, so I'm trying to see the downside on this one. If I don't like it, I can always pull the cash out in a few months and keep the $500.
Anyone take one of these offers and want to let me in on how it went?
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I have a capital one 360 account and like it. I have opened an account before to get a bonus with switching my direct deposit and have never had any trouble getting the bonus offer. My only complaint with 360 is that it takes about a week for any transfer to happen, so getting access to your money is not as immediate as other online banks I have used.
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If you have the cash and it's worth it to you, I'd say go ahead.
There are several people on the forum, doing what you describe, but they have a routine of opening / closing accounts to collect as many bonuses as possible. I'm not an expert, but they can stear you the right way.
https://forum.mrmoneymustache.com/share-your-badassity/bank-account-churning-how-to-make-$1600-in-a-year-by-being-organized/ (https://forum.mrmoneymustache.com/share-your-badassity/bank-account-churning-how-to-make-$1600-in-a-year-by-being-organized/)
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How long would you need to keep that much money in the account? It could be worth it since you have that much in cash anyway.
If you are willing to do a bit of upfront work there's also 5% interest FDIC insured savings through NetSpend/Insight! (link in my signature)
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My main credit card is through them, so I get offers periodically.
This one is deposit $50k and they give you $500. The interest rate is 1.4% as well, whereas my local bank is .15% on regular savings. I've seen offers like this before, but they required switching your direct deposit, which is a hassle. This one is just a deposit. The account is FDIC insured.
We keep about that much in cash, so I'm trying to see the downside on this one. If I don't like it, I can always pull the cash out in a few months and keep the $500.
Anyone take one of these offers and want to let me in on how it went?
My wife and I took similar deals with Discover Bank last year. We each opened accounts with a $20k deposit and each got $200. At least with Discover, there was no direct deposit requirement and we could have closed our accounts immediately and kept the $200 if we wanted to.
For us the free $400 was worth it. We have a higher interest rate to boot (currently 1.4%). We moved money from Capital One 360 which only had a 0.75% rate at the time, and is now 1.0%. I assume your 1.5% offer with Capital One is a promotional rate since it's 50% more than what I'm getting with Capital One 360.
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The 1.4% is part of a promotion, but I believe it's their regular rate on Money Market accounts. These have been FDIC insured for a while now, so from that point of view are pretty much savings accounts. Withdrawal frequency and other differences notwithstanding.
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The 1.4% is part of a promotion, but I believe it's their regular rate on Money Market accounts. These have been FDIC insured for a while now, so from that point of view are pretty much savings accounts. Withdrawal frequency and other differences notwithstanding.
Ah, gotcha -- didn't realize it was money market vs regular savings. And my mistake on the 1.4% vs 1.5%.
At any rate, I can't think of a good reason to not do it. You might need to harass/remind Capital One to deposit the bonus after you qualify -- we had to do a little of that with Discover.
Reading through the 'bank account churning' thread was interesting. Some folks spend a lot of time doing this sort of thing and end up with a couple thousand a year in account bonuses. I don't think I'm cut out for that, but in your case the $500 sure seems like low-hanging fruit.