Do you earn hundreds, even thousands, of dollars for opening a checking or savings account? That is the promise that many banks are making these days. And while almost everyone is in the market for some extra cash (in some cases as much as $3,000), these accounts often have a lot of pitfalls. “Banks are counting on the fact that most people won’t actually abide by all the terms and conditions, which often require you to maintain a large balance in the bank for a long period of time, even if your rate is no longer competitive.” “. says MaxMyInterest CEO Gary Zimmerman.
That’s why the pros say most of you are better off with a savings account without so much trouble. And we’ve got good news there: Many high-yield savings accounts are paying out more than they’ve paid in a decade, and here’s a look at some of the highest-paying savings accounts.
That being said, if you can meet the terms and conditions of an account with a big bonus, by all means go for it. Here’s what to know before opening one of these accounts, and here are the top 10 bonuses we found this month.
read the fine print
The English poet Ted Hughes once said: “Nothing is free. Everything has to be paid for.” And signup bonuses are no different. For those with excess cash and prepared for the increasing challenges that come with it, Zimmerman says it’s critical to take a close look at the requirements. “Some banks have direct deposit requirements or a minimum initial deposit requirement, which can sometimes be difficult to meet,” says Zimmerman. (You can see some of the highest-paying savings accounts here.)
Don’t forget bonuses are taxable
Even after all those hurdles are cleared, Chanelle Bessette, banking specialist at NerdWallet, says there’s still another caveat at the end of the winding road: taxes. “The IRS generally considers bonds to be income, so you will likely have to pay tax on your bond.” Zimmerman goes even further by saying, “You probably won’t be able to keep the full amount of the bonus” because of them, she explains.
Avoid unnecessary charges
Another key area that is hard to avoid is fees. And they can start to add up, eventually wiping out any qualifying bonuses. The average overdraft fee, to begin with, was $29.80 in 2022, according to a recent Bankrate survey. Meanwhile, ATM out-of-network transaction fees were $4.66 and non-customer fees were $3.14. Matthew Goldberg, Bankrate’s consumer banking reporter, says anyone moving to a new bank on the basis of an account sign-up bonus should compare their current bank’s fee structure beforehand.
“Make sure you don’t pay any fees,” Goldberg said. “And a bonus on an account might be worth it now, but sometimes a higher performing account might end up being a better deal. Every situation is different. But these are things to keep in mind to find the account that’s best for you.”
Bessette adds that other account bonuses also come with account closure penalties. “So if you’re trying to open an account just so you can take the bonus and walk away, you may be charged a fee when you do so,” says Bessette.
Top 10 Bank Account Bonuses
If you’ve read all the fine print and are still up for the challenge, we’ve rounded up the best bonuses available for checking and savings accounts for January 2023. The first five are the best savings account deals, and the next five are for accounts currents. (You can see some of the highest-paying savings accounts here.)
5 Best Savings Account Bonuses
Citi® Savings Account: The more savings you can add to your Citi® Savings Account, the better the bonus. For existing Citi clients who open a new “new funds at Citibank” savings account by January 9, 2023, and have $1 million to do so, they are eligible for a $3,500 bonus. For those with less, there is of course a sliding bonus scale. For example, balances from $10,000 to $29,999 will only qualify for a $40 bonus, while accounts from $500,000 to $999,999 qualify for $1,750. In addition to the tiered bonus platform (found in the fine print), there are, of course, some hoops involved. For starters, savers with qualified savings accounts and who live in certain states must transfer their money into the account within the first 20 days and maintain that balance for 60 consecutive days. Bonuses will also be affected if that amount falls below the minimum threshold at any time during that period.
BMO Harris PremierTM Account: Open a savings account by January 6 with $7,500 in qualifying direct deposits within the first 90 days of account opening and you could take home a hefty $350 cash bonus. These qualifying deposits include wages or other personal income, such as a paycheck, pension payment, Social Security payment, or other government benefit payments that are electronically deposited into an employer or similar third-party account, depending on the terms.
SoFi checking and savings account: This bonus offer couldn’t be more transparent. Take home $250 cash when you open a savings account and maintain a balance of more than $5,000 for 25 days in a row. However, accounts with balances from $1,000 to $4,999 will only qualify for a $50 bonus. Deposits here must also be made via ACH from an enrolled member’s employer, payroll or benefits provider.
TD Signature Savings/TD Simple Savings: These two TD savings accounts come with a few different features, but the bonus is simple. Deposit $10,000 or more with new money in the bank within 20 days of opening a TD Signature Savings or TD Simple Savings account, hold that balance for 90 days, and take home a neat $200 bonus with this offer .
Discover online savings from the bank: Deposit at least $25,000 and earn a $200 bonus when you open a new savings account with Discover. Deposits that are at least over $15,000 earn a $150 bonus.
You can see some of the highest interest savings accounts here.
5 best checking account bonuses
Citibank: Act by January 9th and earn a cash bonus of up to $2,000 for making a minimum deposit of $300,000 in the first 20 days of a newly opened account. If you can keep that balance for 60 days from the 21st, the cash bonus here is all yours.
Chase Private Client Checking Account: Open a new checking account by January 25 and transfer a total of $250,000 within the first 45 days in new money or securities to the bank and a $2,000 cash bonus will appear in your account within 40 days, the bank says . Deposits here exclude business checking and savings accounts, any JP Morgan self-directed and automated investment accounts, JP Morgan Wealth Management retirement accounts and CDs.
Huntington Platinum Perks Checking Account: Make cumulative deposits of at least $25,000 into a new Huntington checking account within 90 days, maintain open status on an eligible product during those 90 days, and you can take home a $600 cash bonus. You must also be a resident of Colorado, Illinois, Indiana, Kentucky, Michigan, Minnesota, Ohio, Pennsylvania, South Dakota, West Virginia, or Wisconsin to qualify.
HSBC Premier checking account: Open a $10,000 monthly recurring qualifying direct deposit checking account for three consecutive calendar months and earn a $500 bonus with this offer. Deposits that qualify here must be electronic deposits of regular periodic ACH payments, such as salary, pension, Social Security, or other regular monthly income from an employer or outside agency.
Citizen Current Account: Open your first personal checking account with Citizens by January 20 and make a one-time direct deposit of $500 or more that posts within 60 days and earn a $300 bonus. You can earn an additional $100 in $2 increments when you make qualifying debit transactions that post and clear within 60 days.
Any advice, recommendations or rankings expressed in this article are from MarketWatch Picks and have not been reviewed or endorsed by our trading partners.