Banks and credit unions often offer cash incentives to attract new customers and new deposits. Customers are initially lured to banks with bonuses and may end up holding their checking or savings account for years. As a consumer, his account can benefit greatly from bonuses, especially if the requirements are simple and can be met with relatively little effort.
Bank account bonuses often range from $50 to $500, but there are also bonuses in the thousands of dollars. Here are five tips to help you qualify for and earn a bank account bonus.
How do bank account bonuses work?
Banks may offer bonuses to people who open a personal or business account and meet certain requirements. In addition to bonuses for opening a new savings or checking account, some banks also offer referral bonuses for existing customers who acquire new customers.
Options for qualifying for bank bonuses may vary by bank. However, you may be required to open an account and perform one or more of the following actions within a certain period of time.
- Deposit the specified amount into your account and maintain the balance. If you deposit at least $10,000 into your account and keep it for 30 days, you are eligible to receive the bonus.
- Deposit the set minimum amount directly into your account. For example, the bank may require that he receive $4,000 by direct deposit within the first 120 days.
- Sets the minimum number of debit card purchases. For example, you may be required to make at least 15 purchases with your debit card within 60 days of opening your account.
To get the bonus, you may also need to deposit new money into your account instead of transferring it from an existing account you already have at the bank.
Tips for Earning a Bank Bonus
Before you claim a Bank Bonus, it’s important to understand exactly what it takes to get it. This way you won’t waste your time and money on bonuses that aren’t right for you. Moreover, proper organization can ensure successful bonus acquisition. If you are interested in earning one or more bank bonuses, keep these five rules of thumb in mind:
1. Know where to look
Bankrate has an up-to-date list of the best bank account bonuses, including bonuses for new personal or business accounts and bonuses for referring friends and family to your bank as new customers. Your local bank or credit union may also offer account bonuses from time to time. Ads for such bonuses may be sent to you by mail, and you can find them by regularly checking your local bank’s website.
Remember: If you open a new checking account to replace your old checking account, make sure you transfer direct deposits and automatic charges to the new account before closing your old checking account. please. This may take some time, but it will prevent your old account from being overdrawn.
2. Search for bonuses you can earn
Search for bank bonuses with easy-to-fulfill requirements regarding starting minimum deposit amount or minimum direct deposit amount. For example, if a bonus requires a larger initial deposit than you’d like, it’s probably best to avoid it altogether. Similarly, if you have to hold the money in your account for 120 days but need to withdraw it sooner, it’s not worth pursuing the bonus.
3. Read the terms and conditions carefully.
Before claiming your bonus, read the terms and conditions carefully to see if there are any rules that may make it difficult to claim your bonus. Other things to look out for are:
- Monthly Maintenance Fee: If the account you open has a monthly maintenance fee, it may affect your balance unless you qualify for a fee waiver. Such fees may also result in disqualification from receiving the bonus if the balance falls below his daily minimum amount to receive the bonus. A temporary shortfall in even one of his days within a billing cycle may result in the bonus being voided or a fee being charged.
- Early Account Closure Fee: If you plan to close your account after receiving your bonus, be aware of the early account closure fee. If your bank charges such a fee, it’s often a $5 to $50 fee if you close your account within 90 days of opening it, but the fee can be higher and last longer. there is.
- Hard Credit Reports: Banks may run these credit inquiries when you apply for an account. Hard credit inquiries can have a negative impact on an individual’s credit score, and having too many of them on your credit report can indicate you’re a high credit risk.
4. Stay Organized
Keeping track of your bonus details in a spreadsheet will ensure you meet your requirements within the allotted time period, especially if you’re trying to earn multiple bonuses at the same time. If you plan to close your account after receiving your bonus, be aware that there may be early account closure fees and how long you must keep your account open to avoid this.
The information you need to record in the spreadsheet is:
- Bank Name
- Bonus Dollar Amount
- Requirements to Receive the Bonus
- Account Opening Date
- Deadline to Meet Requirements
- Date Received Bonus
- Date Received Bonus
- Early Account Closure Fee (if applicable)
Having all the relevant details in one place will help you stay on track and receive your bonus by the set deadline. When signing up with a new bank, be sure to record your login details.
5. Set money aside for taxes
When you receive a bank bonus, the Internal Revenue Service (IRS) taxes the bonus at the same rate as income tax. Setting aside money for this purpose as soon as you receive your bonus will ensure you have the funds you need at tax time. As tax season approaches, your bank may send you a 1099-INT or 1099-MISC form regarding your bonus. Even if you don’t receive an IRS form, you’re still responsible for paying taxes on the bank account bonus you earned. Form 1040 provides an opportunity to report income from prizes and winnings.
Conclusion
If getting a bank bonus is easy and doesn’t take too much time, it’s worth it. Knowing where to look for such bonuses can help you avoid missing out on the right ones. It is also important that organizations comply with minimum deposit or debit card purchase requirements. Reading the fine print carefully and setting aside some funds for taxes will also help you succeed.