Bank bonus bonanza!

Have you ever gotten a bank bonus? You know – the ones where you open an account, jump through hoops, and then the bank eventually deposits a cash bonus into your account.

Over the years I’ve taken advantage of a few bonuses when I received good offers. I’d get a snail mail from a bank, open an account and make $150 to $200. It was nice when it happened.

One day I had the genius idea of looking for bank bonuses on the interweb. I’ve no idea why I didn’t think of this sooner. Maybe I’m a little slow. Anyway I discovered a great site and community for bank bonuses – DoctorOfCredit. Little did I know that people are making thousands of dollars from bonuses. Someone claimed to have made $8,000 in a single year! Sign me up, right?

The DoctorOfCredit keeps a current list of the best bank bonuses. The site has other helpful information about bank bonuses which is definitely worth exploring. Check it out.

Really Stupid Comic #6

Important to know

In the meantime, here’s a summary of the most important things I’ve learned to help get you started:

  1. Banks use a system called ChexSystems to find out if you’ve ever had a bad bank account and how many accounts you’ve recently opened. You can generally open up to 12 new bank accounts per year before banks start denying your application. If you include your spouse, that’s a total of 24 accounts. I plan to keep it down to less than 8 accounts per year per person or less than 16 when I include Mrs. FF.
  2. Banks usually do what DoctorOfCredit calls a Soft Pull on your credit score. That means the bank just reads your credit score from a credit bureau when you submit an application. The bottom line is that opening a new bank account generally does NOT change your credit score unless you enroll in overdraft protection. So stay away from overdraft protection when you apply.
  3. Bonuses are usually between $100 and $400. I shoot for $200 or more.
  4. Some bonuses require Direct Deposits. Direct Deposits are things like employee paychecks, social security, or pensions. These are a pain in the ass to change. But here’s a trick – some banks count external transfers from other banks or even Paypal as a Direct Deposit. Doctor of Credit conveniently tracks these.
  5. Calculate how much you really make from a bonus when you take into account lost interest. Suppose a bank bonus requires a $15,000 deposit for 6 months to get a $200 bonus with little or no interest. You’ll lose $75 dollars in interest that you would have gotten in your regular 1% savings account. So you’re only really making $125. Good, but not great.
  6. Read the comments at the end of the DoctorOfCredit bank bonus posts. They help you understand what tips and tricks people are using to get the bonus.
  7. Keep a spreadsheet of all your bank bonuses including amount, account opening date, account closing date, and notes. Closing dates are important because some banks allow you to get a bonus more than once depending on when your last account was closed.
  8. Some banks let you make an initial deposit with a credit card as a purchase. So if I fund a $2,000 initial deposit with a purchase – not cash advance – from my 2% cash back credit card, I make an instant $40 on top of the bank bonus. Crazy, right?
  9. Bank bonuses count as interest for tax purposes. That’s another reason to keep a spreadsheet but most banks will also send you a 1099-Int.

There’s definitely a hassle factor with doing bank bonuses so calculate your hourly wage to see if it’s worth your time. If you spend 4 hours working on a $200 bank bonus, you’re making $50 per hour before taxes. Not bad. But if you spend 8 hours dealing with a $100 bank bonus you’re only making $12.50 per hour. Not worth it for me.

But what about the poor, poor banks? 😥

You might feel sorry for the banks. Don’t. They factor in people like us who open accounts just for the bonus. And they still make tons of money from peddling bonuses to people who keep their new accounts! Besides some banks have done some pretty bad stuff lately: opening dummy client accounts, outrageous executive bonuses, and insane fees.

Remember when Wells Fargo opened all those dummy client accounts? And then all the senior executives claimed ignorance after setting up an employee reward system for opening up new client accounts that put tremendous pressure on low-level employees? And then many of those same low-level employees got fired? It still pisses me off. So when Mrs. FF recently got a $250 bonus from Wells Fargo, it felt like cosmic justice. I did the Happy Dance!

Our results

Mrs. FF and I have already made $1,300 this year, but we aren’t done. I estimate we can make between $2,000 and $2,500 for the total year. And I think it’s possible to do the same next year. It’s the closest thing I’ve found to free money. Go get yours!

Thanks for reading! Have you ever scored a bank bonus?

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  1. What a great idea…..I have made a couple of bucks off new CC’s. But every time I have tried to take advantage of a bank offer there is the “dreaded direct deposit clause”. I don’t get direct deposit for anything and as you point out it is a giant pain to change it. Thanks to you I’ll be checking it out again….$2K a year for basically doing nothing is Ok by me….

    1. Yep, the direct deposit is a hurdle for me as well since I’m already FIREd. Of course some bonuses don’t require any direct deposit. They’re my favorite!

  2. I’ve gone after bank bonuses in the past. Chase has pretty good ones. I might have churned it once but now keep it since I have my mortgage through them and they give me 1% cash back on my mortgage payments. Also, one time when my wife opened and closed an account, the CSR kind of made her feel bad implying that she only opened for the bonus. Next time, I’ll just find a way to close it online or something. There definitely is a hassle factor involved which is why I did this more so when I was younger and had more free time.

    1. I’m FIREd so I have plenty of free time to fiddle with bank bonuses. 😀 But yeah, you’re right – you have to figure if it’s worth the trouble. Some bonuses are really easy and definitely give a great ROI of time.

      I’ve never had a bank CSR be rude. That sucks, but it’s rare from my experience and from what I’ve read. I often close the account via secure email or chat.

  3. I used to chase this, but a combination of lazy, not enough cash, and low bonuses for a while made me stop. I’ll have to check out DoctorOfCredit, seems like a good resource!

    And #4, that’s great to know! That was always a deterrent for me, but if you can fake it that’s awesome 🙂

    1. I find it can be worth the trouble – some bonuses can be relatively easy and as high as $300 or $400.

      Yeah, #4 Direct Deposit, was an issue for me as well. Since I’m FIREd, I have no employee Direct Deposit to redirect! DoctorOfCredit has helped me work around this. Sometimes the bank is so lenient that any kind of Person-to-Person transfer will count as a Direct Deposit.

    1. Erik – You’re welcome!

      I’m not even really trying very hard – I’m just picking the easiest bank bonuses. There are others who make way more than me.

  4. I can’t say I have ever heard of chasing bank bonuses. It seems like most people are busy chasing credit card sign up offers. Sounds like a good gig aside from the pesky time factor. Between the job, blog and baby I’m not looking to taking on anymore right now.

    It does sound more rewarding per hour than most side hustles you can do from your couch though.

    1. Bank bonuses do have one big advantage over credit card bonuses – bank bonuses don’t usually reduce your credit score. The downside is that you have to jump through more hoops including closing bank accounts. YMMV.

    1. You’re welcome.

      Many of the bank bonuses are really not much of a hassle, but still may not be worth it depending on how you value your time in dollars per hour.

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