News

Actions

Banking on bonuses: How banks are offering perks to open up accounts

Posted at 3:07 PM, Jan 12, 2017
and last updated 2017-01-13 10:28:13-05

Marcia Noyes likes to bank as much of her hard-earned money as possible.

She was thrilled when she found she could actually earn cash just by opening a new bank account. “I think it’s around $1125 that I have collected over the time,” she says.

She now juggles six different accounts--- at six different banks. She says the sign up incentives are just too good to pass up, saying it’s “like picking up money off the ground.”

Sean McQuay of Nerdwallet.com says the banks have stepped up their game from the days of “free Frisbees or free coffee” and are now offering cash incentives that can range from $50 to $350 to open new accounts.

He says it’s petty cash for banks who hope to woo you now so they can serve you over the long haul. He explains, “If your checking and savings account are with them, then chances are you’re going to think of them first when you need a mortgage or need a loan, and that’s where banks are making a lot of their money.”

There are things to consider before you dash for the cash. “Well, if you juggle several accounts, be aware of potential pitfalls,” says McQuay, adding that “more than one account can be a lot to keep track of, especially when there are requirements you must meet,” such as direct deposit and minimum balances.

As always, read all the fine print and look for potential restrictions and fees.

“If the account is offering you $200 to sign up for it and they’re charging you $10 a month, that means over the course of two years you’ve lost out on that money and you’re financially worse off than you were before,” explains McQuay.

Marcia benefitted in the long run by moving to accounts that pay a higher interest.  She says the cash incentives turned her into a savvy bank shopper. “It gives you a chance to try them out and make money in the process.”