Citibank has a $400 bonus offer for new checking account customers. Here are the highlights:
- To qualify for a $400 cash bonus, open a new consumer checking account in The Citibank Account Package by 10/31/16.
- Within 30 days from the date you opened your new checking account, deposit $15,000 or more in new-to-Citibank funds into your new checking account or new or existing Citibank Savings Plus account.
- A minimum balance of $15,000 is required to be maintained in the new checking account or new or existing Citibank Savings Plus Account, for 30 consecutive calendar days following the date you made your qualifying deposit.
- The cash bonus will be credited to your new checking account within 90 calendar days from the date when you completed all offer requirements.
- To be eligible for this offer, you must not currently have a Consumer checking account with Citibank or have been a signer on or owner of a Citibank consumer checking account within the last 60 days.
- Limit of one of each offer per customer and one offer per account.
Here are details for The Citibank Account Package:
- $25 monthly service fee waived if you have $10,000 in combined average monthly balances.
- Interest rate is a tiny 0.01% APY.
- Free withdrawals from all Citibanks ATMs.
- Citibank will waive their $2.50 fee for using non-Citibank ATMs, if combined average monthly balances in eligible linked accounts are met. However, you may still be charged a fee by the ATM owner itself.
- No early account closure fee.
Let’s see… To start, you must not have had a Citibank consumer checking account within the last 60 days. Next, you’ll need to bring in $15,000 of money from a non-Citibank account, and keep it there for 30 days. You’ll need to keep $10,000 in your account to avoid the $25 monthly service fee. You’ll need to keep the account open for up to another 90 days (up to 120 days total) until the $400 bonus arrives.
It is not clear if you need to keep you account at the “Citibank Account” package level past the first 30 days. To be safe, you may want to keep it at that level ($10,000 minimum balance) until the bonus shows up. After that, you may downgrade to their Basic or Access levels with much lower minimum balance requirements, or you may choose to eventually close out the account after that if it doesn’t work for you.
Worth the effort? If you had $15,000 sitting in a 1% APY savings account, you’d earn $50 of interest over 4 months. So you could view this as $350 in extra interest over 4 months. Alternatively, if you earn $400 of interest on a $15,000 balance over 120 days (also ~4 months), that works out to roughly a 8% annualized interest rate. If you take out $5,000 after 30 days and keep $10,000 in there, your effective interest rate will be even higher, closer to 10% annualized interest rate for those 4 months. If the bonus arrives earlier, you could do better. At these assumed balance levels, you will avoid all monthly account fees. Note that the $400 will be reported on a 1099-INT form. Thus your interest is taxable as ordinary income, but any monthly fees you pay are not tax-deductible.