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Should You Open a New Bank Account and Get a Cash Bonus?

Banks are offering up to $750 — with strings, of course

closeup of someone using a mobile phone to open an online bank account

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En español | "Found money” is a notion that makes the heart sing, especially when the economy is uncertain. Pocketing hundreds of dollars unexpectedly would make anyone's day.

Well aware that people love freebies, a number of major financial institutions are enticing consumers to open checking or savings accounts with offers of hefty, one-time cash bonuses. These offers could net you as much as $750. That's better than a toaster.

What's in it for banks?

Attractive sign-up bonuses help to differentiate them in a highly competitive market. They also attract new customers — and new money, says Greg McBride, chief financial analyst at Bankrate.com. And, he says, bonuses are higher for larger accounts, which are more profitable over time.

The catch: To receive, and keep, your bonus, you'll have to abide by the rules for each offer. Generally speaking, McBride says, doing so will require plunking down new money. Bonuses will not be paid for depositing funds in an existing account at the bank, or for funds you transfer from a different account at the same bank.

"Bank bonuses will often require additional activity, such as monthly direct deposits. And a standard requirement with these bonuses is to maintain the balance in the account for a specific amount of time or risk having some or all of the bonus clawed back,” he says.

Here are four current offers to consider.

1. Citizens Bank — $300

Citizens Bank in Providence, Rhode Island, will award you $300 for opening a personal checking account between now and Nov. 26. All you need to do is make a direct deposit of $500 or more within 60 days of opening the account. In addition, you can earn $2 on each debit card purchase, up to $100, if made within those 60 days.

The fine print: As the primary signer on the new checking account, you may not have been a signer on any Citizens personal checking account within the previous six months. Direct deposit is defined as recurring income electronically added to your Citizens checking account and may include salary, pension and other regular income.

2. Chase — $200

Chase is offering a $200 bonus to new customers who open a Total Checking Account now through Jan. 20.

The fine print: To qualify for the bonus, you must not have an existing Chase fiduciary or checking account (or had one closed with a negative balance or within the last 90 days). In addition, you will be required to make a direct deposit or deposits that total $500 or more in the first 90 days.


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3. Huntington National Bank — $150 to $750 

At Huntington National Bank you can earn a bonus of between $150 and $750 for opening personal or business checking accounts and making the required deposits.

Its Asterisk-Free Checking account requires a minimum $1,000 deposit for a $150 bonus. Choose the Business Checking 100 account, make a minimum $2,000 deposit, and you'll earn $200. The Unlimited Business Checking account nets a $400 bonus for depositing at least $5,000. Finally, select the Unlimited Plus Business Checking account, add at least $20,000 to your account, and receive $750.

The fine print: These offers are valid through Jan. 7 and are open to residents of Illinois, Indiana, Kentucky, Michigan, Ohio, Pennsylvania and West Virginia. The deposits noted must be made within 60 days of opening the account.

4. Citibank — $200, $400 or $700

Citibank, likewise, has a tiered bonus offer, which can yield $200, $400 or $700, if you're willing to open a checking account, or both a checking and a savings account. For $200, open a checking account in the Basic Banking Package and deposit a minimum of $5,000. To earn $400, open checking and savings accounts in the Citibank Account Package, and add at least $15,000. To yield $700, open checking and savings accounts in the Citi Priority Account Package and park at least $50,000.

The fine print: To earn your bonus, in each case the required deposits must be made within 30 days of opening the checking account, and the balance maintained for 60 days. All three offers expire on Jan. 5.

Brokerage Firms Will Pay Up, Too

You've been lucky and received a windfall of some sort. You've decided to open a new account and invest your cash stash, since the income earned from current interest rates is paltry. Or you simply want to move your current account to a new broker.

Now is the time to act. A number of brokerage firms are willing to pay some tempting cash bonuses to win your business. As of mid-November, Ally Invest was offering $50 to $3,500; Merrill Edge, $100 to $600; TD Ameritrade, $350 to $2,500; and E-Trade, $25 to $2,500.

At Ally Invest, for example, to get your bonus, deposit or transfer these amounts: $10,000 to $24,999 for $50; $25,000 to $99,999 for $200; $100,000 to $249,999 for $300; $250,000 to $499,999 for $600; $500,000 to $999,999 for $1,200; $1 million to $1,999,999 for $2,500; and $2 million or more for $3,500.

At Merrill Edge, the cash bonus is $100, $150, $250 or $600 for opening a new account with qualifying assets of $20,000, $50,000, $100,000 or $200,000 or more, respectively.

But be prepared to park these funds to keep your bonus. At Merrill, you will be required to make the qualifying deposit to your new account within 45 days, and maintain your balance for at least 90 days. At Ally, both the cash bonus and your qualifying deposit (minus any trading losses that are incurred) cannot be withdrawn for 300 days.

Be sure to read all of the rules and regulations carefully so you fully understand the decision you're making.

montage of logos of banks and financial institutions

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Buyer beware

Before signing up for any of these or other deals, be sure to read the information the bank provides for its accounts, including their eligibility requirements and fee structures. Be advised that these bonuses will be reported to the IRS for personal income tax purposes.

If you plan to move your existing savings and checking accounts to a new institution, you may want to keep your old accounts open at least a month.

That should give you enough time to move your payment information for the bills that you've been paying via direct debits to your new accounts. Also, if Social Security now sends your benefit payment electronically to your bank via direct deposit, be sure to change your direct deposit information online or by calling 800-772-1213, and allow adequate time for your account to be updated. Your benefit should land in your new account by the second payment after you've provided your new account information. Payments are made the second, third or fourth Wednesday of the month, depending on your date of birth. You can view the Social Security payments calendar online. 

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