Organize Credit Cards Physically Using Business Card Holders

September 20, 2020 By Jonathan Ping 4 Comments
My Money Blog has partnered with CardRatings and Credit-Land for selected credit cards and may receive a commission. All opinions expressed are the author’s alone, and has not been provided nor approved by any of the companies mentioned.

A reader asked me how I keep track of so many credit cards, and I wasn’t sure what they meant. I track active credit card offers using online calendar reminders and a simple spreadsheet, but physically I keep them all in a business card organizer (if not in my wallet). I realized that I still had an old article published way back in 2007 about repurposing my old baseball card sleeves and a 3-ring binder. I’ve deleted that post since it’s very outdated and replaced it with this one, as I’ve actually used a business card holder for several years now. Mine looks almost identical to this 4.6 star item or this smaller 4.7 star version on Amazon (both around $7):

As a few readers back then noted, my baseball card sleeves were a little too big and the cards could fall out if the binder was tipped upside down. With these business card holders, the sleeves are smaller and the openings are on the sides for a much more secure fit. This also makes the overall package smaller, making it possible to keep nearly a hundred cards in a single, compact folder.

I have three of them altogether: one for credit and debit cards, one for gift cards and loyalty/membership cards, and one for business cards. Instead of a “sock drawer”, I have a subtle, black folder that blends in discretely on a bookshelf, and is also easy to quickly throw into a lockbox for added security. Of course, these days it’s also handy to keep all your credit card numbers in a password manager like Keeper or Dashlane.

Filed Under: Banking, Credit Cards, Simple Living
Last updated: September 21, 2020
My Money Blog has partnered with CardRatings and Credit-Land for selected credit cards, and may receive a commission from card issuers. All opinions expressed are the author’s alone, and has not been provided nor approved by any of the companies mentioned. MyMoneyBlog.com is also a member of the Amazon Associate Program, and if you click through to Amazon and make a purchase, I may earn a small commission. Thank you for your support.

BlockFi Promo: $250 USDC Bonus with $10,000 Deposit + 8.6% Interest

September 16, 2020 By Jonathan Ping 24 Comments
My Money Blog has partnered with CardRatings and Credit-Land for selected credit cards and may receive a commission. All opinions expressed are the author’s alone, and has not been provided nor approved by any of the companies mentioned.

BlockFi is a cryptocurrency platform that both pays interest on deposits and earns interest via cryptocurrency-backed loans. Right now, they are offering an up to $250 USDC bonus for new clients that sign up and fund a new BlockFi account by September 25th. Here are the bonus tiers:

  • Deposit $500 to $999, Get $25 USDC Bonus.
  • Deposit $1,000 to $4,999, Get $50 USDC Bonus.
  • Deposit $5,000 to $9,999, Get $100 USDC Bonus.
  • Deposit $10,000+, Get $250 USDC Bonus.

You must deposit by 9/25/2020 and hold until 12/14/2020, for a minimum holding period of just under 3 months. $50 earned on $1,000 held for 3 months is equivalent to 20% APY. $250 earned on $10,000 held for 3 months works out to 10% APY. The bonus is paid in USDC, which is a stablecoin backed by real US dollars held in a bank account.

Update: I’m in the process of doing this promo myself, and discovered that you must either deposit cash by domestic bank wire or depositing your own crypto. For example, Ally Bank charges $20 for a domestic wire. You can also transfer over from another wallet like Coinbase, which lets you buy crypto from debit cards with a fee. You can later make a withdrawal via wire back to US dollars, but with a $5,000 minimum, or transfer to another wallet address. I thought this promo would be as easy as the $25 BTC Voyager promo, but it looks like a bit more work and perhaps not worth it for smaller amounts.

The promo code will be auto-populated as “getusdc” if you use the link above. There are no trade requirements, but when you deposit USD it will be converted to the GUSD (Gemini stablecoin) by default. (You can buy USDC or something else if you wish.) The good news is that both GUSD and USDC earn interest while waiting for the bonus to post. The BlockFi Interest Account (BIA) currently pays 8.60% APY on USDC and GUSD (subject to change on a monthly basis). Their overall business model is to earn a spread on the difference between lending out money and paying interest.

To earn interest on crypto, we lend assets to highly vetted and audited institutional counterparties. The interest we are able to pay is based on the yield that we are able to generate from lending, which directly correlates to the market demand in the space (I.e. what rate institutions are willing to pay to borrow specific crypto assets, as it varies from asset to asset).

BIA is available in 49 of 50 U.S. states (excluding New York). One free crypto withdrawal per calendar month and one free stablecoin withdrawal per month. After that, additional stablecoin withdrawals are $0.25 each.

BlockFi is definitely one of the more well-established crypto sites, but you should do your own due diligence as it is not an FDIC-insured bank account nor a SIPC-insured brokerage account. I found that they were backed by some reputable firms including Fidelity Investments and Coinbase, with over $100 million raised so far. They use Gemini as their primary custodian, which is a licensed custodian and regulated by the New York State Department of Financial Services. As such, they will still require your name, address, and Social Security Number to verify the identity of all accountholders.

Filed Under: Banking, Deals & Offers
Last updated: September 17, 2020
My Money Blog has partnered with CardRatings and Credit-Land for selected credit cards, and may receive a commission from card issuers. All opinions expressed are the author’s alone, and has not been provided nor approved by any of the companies mentioned. MyMoneyBlog.com is also a member of the Amazon Associate Program, and if you click through to Amazon and make a purchase, I may earn a small commission. Thank you for your support.

Best Interest Rates on Cash – September 2020

September 9, 2020 By Jonathan Ping 8 Comments
My Money Blog has partnered with CardRatings and Credit-Land for selected credit cards and may receive a commission. All opinions expressed are the author’s alone, and has not been provided nor approved by any of the companies mentioned.

Here’s my monthly roundup of the best interest rates on cash for September 2020, roughly sorted from shortest to longest maturities. I track these rates because I keep 12 months of expenses as a cash cushion and also invest in longer-term CDs (often at lesser-known credit unions) when they yield more than bonds. Check out my Ultimate Rate-Chaser Calculator to see how much extra interest you’d earn by moving money between accounts. Rates listed are available to everyone nationwide. Rates checked as of 9/9/2020.

High-yield savings accounts
While the huge megabanks still pay nearly zero, it’s easy to open a new “piggy-back” savings account and simply move some funds over from your existing checking account. The interest rates on savings accounts can drop at any time, so I list the top rates as well as competitive rates from banks with a history of competitive rates. Some banks will bait you with a temporary top rate and then lower the rates in the hopes that you are too lazy to leave.

  • Affirm has the top rate at the moment at 1.00% APY with no minimum balance requirements. I wonder how long this will last, as the rate is high but Affirm also charges really high interest to let folks buy jeans on a payment plan. There are several other established high-yield savings accounts at a little below 1% APY for now.
  • If you want some upside potential, HM Bradley is still advertising a 3% APY top rate for those that spent the previous quarter saving at least 20% of your direct deposit. It’s likely to drop next quarter starting 10/1, but if you can make a real direct deposit by 10/1 (and not withdrawal more than 80% of it) you’ll earn at least 1% APY in September and gain the possibility of a rate greater than 1% after 10/1.

Short-term guaranteed rates (1 year and under)
A common question is what to do with a big pile of cash that you’re waiting to deploy shortly (just sold your house, just sold your business, legal settlement, inheritance). My usual advice is to keep things simple and take your time. If not a savings account, then put it in a flexible short-term CD under the FDIC limits until you have a plan.

  • No Penalty CDs offer a fixed interest rate that can never go down, but you can still take out your money (once) without any fees if you want to use it elsewhere. Marcus has a 7-month No Penalty CD at 0.75% APY with a $500 minimum deposit. AARP members can get an 8-month CD at 0.85% APY. Ally Bank has a 11-month No Penalty CD at 0.75% APY for all balance tiers. CIT Bank has a 11-month No Penalty CD at 0.35% APY with a $1,000 minimum deposit. You may wish to open multiple CDs in smaller increments for more flexibility.
  • CommunityWide Federal Credit Union has a 12-month CD at 1.00% APY ($1,000 min). Early withdrawal penalty depends on how early you withdraw. Anyone can join this credit union via partner organization ($5 one-time fee).

Money market mutual funds + Ultra-short bond ETFs
If you like to keep cash in a brokerage account, beware that many brokers pay out very little interest on their default cash sweep funds (and keep the difference for themselves). The following money market and ultra-short bond funds are NOT FDIC-insured and thus come with a possibility of principal loss, but may be a good option if you have idle cash and cheap/free commissions.

  • Vanguard Prime Money Market Fund (note the upcoming changes) currently pays an 0.03% SEC yield. The default sweep option is the Vanguard Federal Money Market Fund which has an SEC yield of 0.08%.
  • Vanguard Ultra-Short-Term Bond Fund currently pays 0.82% SEC yield ($3,000 min) and 0.92% SEC Yield ($50,000 min). The average duration is ~1 year, so there is more interest rate risk.
  • The PIMCO Enhanced Short Maturity Active Bond ETF (MINT) has a 0.51% SEC yield and the iShares Short Maturity Bond ETF (NEAR) has a 0.64% SEC yield while holding a portfolio of investment-grade bonds with an average duration of ~6 months. Note that there was a sudden, temporary drop in net asset value during the March 2020 market stress.

Treasury Bills and Ultra-short Treasury ETFs
Another option is to buy individual Treasury bills which come in a variety of maturities from 4-weeks to 52-weeks. You can also invest in ETFs that hold a rotating basket of short-term Treasury Bills for you, while charging a small management fee for doing so. T-bill interest is exempt from state and local income taxes. Right now, this section probably isn’t very interesting as T-Bills are yielding close to zero!

  • You can build your own T-Bill ladder at TreasuryDirect.gov or via a brokerage account with a bond desk like Vanguard and Fidelity. Here are the current Treasury Bill rates. As of 9/8/2020, a new 4-week T-Bill had the equivalent of 0.10% annualized interest and a 52-week T-Bill had the equivalent of 0.15% annualized interest.
  • The Goldman Sachs Access Treasury 0-1 Year ETF (GBIL) has a 0.08% SEC yield and the SPDR Bloomberg Barclays 1-3 Month T-Bill ETF (BIL) has a -0.04% (!) SEC yield. GBIL appears to have a slightly longer average maturity than BIL.

US Savings Bonds
Series I Savings Bonds offer rates that are linked to inflation and backed by the US government. You must hold them for at least a year. There are annual purchase limits. If you redeem them within 5 years there is a penalty of the last 3 months of interest.

  • “I Bonds” bought between May 2020 and October 2020 will earn a 1.06% rate for the first six months. The rate of the subsequent 6-month period will be based on inflation again. More info here.
  • In mid-October 2020, the CPI will be announced and you will have a short period where you will have a very close estimate of the rate for the next 12 months. I will have another post up at that time.

Prepaid Cards with Attached Savings Accounts
A small subset of prepaid debit cards have an “attached” FDIC-insured savings account with exceptionally high interest rates. The negatives are that balances are capped, and there are many fees that you must be careful to avoid (lest they eat up your interest). Some folks don’t mind the extra work and attention required, while others do. There is a long list of previous offers that have already disappeared with little notice. I don’t personally recommend nor use any of these anymore.

  • One of the few notable cards left in this category is Mango Money at 6% APY on up to $2,500, along with several hoops to jump through. Requirements include $1,500+ in “signature” purchases and a minimum balance of $25.00 at the end of the month.

Rewards checking accounts
These unique checking accounts pay above-average interest rates, but with unique risks. You have to jump through certain hoops, and if you make a mistake you won’t earn any interest for that month. Some folks don’t mind the extra work and attention required, while others do. Rates can also drop to near-zero quickly, leaving a “bait-and-switch” feeling. If you want rates above 2% APY, this is close to the only game in town.

  • Consumers Credit Union Free Rewards Checking (my review) still offers up to 4.09% APY on balances up to $10,000 if you make $500+ in ACH deposits, 12 debit card “signature” purchases, and spend $1,000 on their credit card each month. The Bank of Denver has a Free Kasasa Cash Checking offering 2.50% APY on balances up to $25,000 if you make 12 debit card purchases and at least 1 ACH credit or debit transaction per statement cycle. If you meet those qualifications, you can also link a savings account that pays 1.50% APY on up to $50k. Thanks to reader Bill for the updated info. Find a locally-restricted rewards checking account at DepositAccounts.

Certificates of deposit (greater than 1 year)
CDs offer higher rates, but come with an early withdrawal penalty. By finding a bank CD with a reasonable early withdrawal penalty, you can enjoy higher rates but maintain access in a true emergency. Alternatively, consider building a CD ladder of different maturity lengths (ex. 1/2/3/4/5-years) such that you have access to part of the ladder each year, but your blended interest rate is higher than a savings account. When one CD matures, use that money to buy another 5-year CD to keep the ladder going. Some CDs also offer “add-ons” where you can deposit more funds if rates drop.

  • Greenwood Credit Union has a 5-year certificate at 1.50% APY ($5,000 min), 4-year at 1.00% APY, 3-year at 1.20% APY, and 2-year at 0.90% APY. The early withdrawal penalty for the 5-year is 6 month of interest. Anyone can join this credit union by maintaining $5 in a share savings account.
  • You can buy certificates of deposit via the bond desks of Vanguard and Fidelity. You may need an account to see the rates. These “brokered CDs” offer FDIC insurance and easy laddering, but they don’t come with predictable early withdrawal penalties. Vanguard has a 5-year at 0.50% APY right now. Be wary of higher rates from callable CDs listed by Fidelity.

Longer-term Instruments
I’d use these with caution due to increased interest rate risk, but I still track them to see the rest of the current yield curve.

  • Willing to lock up your money for 10 years? You can buy long-term certificates of deposit via the bond desks of Vanguard and Fidelity. These “brokered CDs” offer FDIC insurance, but they don’t come with predictable early withdrawal penalties. At this writing, Vanguard has a 10-year at 0.85% APY. Watch out for higher rates from callable CDs from Fidelity.
  • How about two decades? Series EE Savings Bonds are not indexed to inflation, but they have a unique guarantee that the value will double in value in 20 years, which equals a guaranteed return of 3.5% a year. However, if you don’t hold for that long, you’ll be stuck with the normal rate which is quite low (currently a sad 0.10% rate). I view this as a huge early withdrawal penalty. But if holding for 20 years isn’t an issue, it can also serve as a hedge against prolonged deflation during that time. As of 9/9/2020, the 20-year Treasury Bond rate was 1.22%.

All rates were checked as of 9/9/2020.

Filed Under: Banking, Deals & Offers, Investing
Last updated: September 9, 2020
My Money Blog has partnered with CardRatings and Credit-Land for selected credit cards, and may receive a commission from card issuers. All opinions expressed are the author’s alone, and has not been provided nor approved by any of the companies mentioned. MyMoneyBlog.com is also a member of the Amazon Associate Program, and if you click through to Amazon and make a purchase, I may earn a small commission. Thank you for your support.

MMB Household Money Flowchart (Money Map)

August 26, 2020 By Jonathan Ping 4 Comments
My Money Blog has partnered with CardRatings and Credit-Land for selected credit cards and may receive a commission. All opinions expressed are the author’s alone, and has not been provided nor approved by any of the companies mentioned.

funny flowchart exampleA reader asked me to complete a money map to help visualize how I manage our finances, as per this neat Money Map chain. I wasn’t sure exactly how much detail to add, but the flowchart below is a good representation of how I organize things mentally. Specifics like brokerage or bank choices may change a few years from now, but this overall structure probably won’t.

Income sources. We receive income via business profits, W-2/contractor jobs, and our portfolio. A portion is automatically directly into 401k, HCFSA, DCFSA, and Solo 401k accounts. (We are not eligible for an HSA.) The dividend and interest income is a circular arrow because technically it is generated and then held in the brokerage account. One day, this might include Social Security, rental income, annuity payments, etc.

Long-term investments (5+ years time horizon). Historically, all our income flows directly into our brokerage accounts (most brokers allow direct deposits). I used to invest monthly, but now the business/job income flows are much smaller in semi-retirement. Dividends arrive into the taxable account quarterly, so I now check once every three months to manually reinvest and/or distribute funds as needed. Other than this check-in every 3 months, this tier is “consciously neglected” and designed to grow over time and eventually become self-sustaining. Here are my intermittent portfolio updates.

Short-term investments (1 month to 5 years). This tier is basically my “emergency fund”. In the accumulation stage, it was between 6 months to a year of expenses. Now, I keep five years of expenses as I am much more reliant on unstable portfolio income and there is less stable job income (human capital). Money comes in quarterly from above, and is taken out monthly for household expenses. This tier is “actively-managed” as I aim for higher returns without extra risk to principal (everything is US gov’t/FDIC/NCUA-insured).

  • Liquid savings. Roughly one year of expenses are kept in a 100% liquid savings account. The location can vary but the default is Ally Bank, as they have a good balance of decent rates, solid user interface for interbank transfers, and human customer service. You can also create multiple savings accounts, all with no minimum balance.
  • Certificates of deposit, etc. The other 4 years of expenses are moved roughly into a 5-year CD ladder, adjusted based on rates. Savings bonds and Treasury Bills may also be used if priced competitively. I tried to take advantage of CD rates when they were 3.5 to 4% APY. I write about these banking opportunities regularly and summarize them monthly.
  • Bank bonuses. If CDs rates are not worthwhile, cash may also be optimized via banking promotions. Banks offer you an incentive to try their product, and I accept the offer if the terms are agreeable. I also write about these opportunities here as they come up.

Day-to-day needs. Each month, a “paycheck” transfer goes from savings to checking. Wherever possible, our day-to-day expenses are put on credit cards to trigger the best credit card bonuses. After the float period, it is paid off in full from checking. A larger purchase may require a direct withdrawal from savings account (i.e. estimated tax payments) or one-time transfer to checking (i.e. fix the fridge). I also use Ally Checking, as you can assign one of your savings accounts as a no-fee overdraft backup source.

This design includes a few purposeful features.

  • Savings to 401k are automatic and first, which is critical when that is your major source of savings. It should happen without any energy requirement. No effort, no reminders.
  • Work income is separated from our spending. In the accumulation stage, you want to get bigger paychecks over time but try your best to ignore them when it comes to spending. Instead, all the income gets mixed together and the first place it lands is long-term investments. In semi-retirement, our incomes fluctuate (quite downward in 2020) and we smooth things out with portfolio withdrawals.
  • Portfolio fluctuations are also tempered by a big cash bucket. It’s easier to sleep at night when you have five years of expenses in safe cash readily available. We didn’t need this much cash in the accumulation stage, but when you rely on the stock market for part of your monthly income, it really helps. Is it psychological? Yes.
  • The “fun” hobby stuff is optional. Don’t feel like chasing rates? Just consolidate at one bank. Don’t feel like a different credit card every quarter? Just switch to one.
  • All accounts are joint where possible. That is simply what has worked best for us.

Anyhow, that’s how it works for us. That monthly transfer from savings to checking gives me a rough idea of our monthly and thus annual spending. As long as that number stays a reasonable percentage of our total portfolio, things are happy. We have had a lot of luck, and I don’t want to squander it.

Filed Under: Banking, Credit Cards
Last updated: August 27, 2020
My Money Blog has partnered with CardRatings and Credit-Land for selected credit cards, and may receive a commission from card issuers. All opinions expressed are the author’s alone, and has not been provided nor approved by any of the companies mentioned. MyMoneyBlog.com is also a member of the Amazon Associate Program, and if you click through to Amazon and make a purchase, I may earn a small commission. Thank you for your support.

HSBC Bank Promo: 3% Cash Bonus on New Deposits, Up to $600 Total

August 26, 2020 By Jonathan Ping 2 Comments
My Money Blog has partnered with CardRatings and Credit-Land for selected credit cards and may receive a commission. All opinions expressed are the author’s alone, and has not been provided nor approved by any of the companies mentioned.

Interest rates on liquid savings accounts keep dropping, making bank bonuses more attractive on a relative basis. Opening new accounts are more hassle, so I usually want at least double the interest rates I could get by doing nothing. This $240/$600 HSBC bank bonus satisfies that requirement at over 12% APY. This bonus is not as simple as I’d like, so let’s unpack the details a bit.

Premier Checking (up to $600) bonus details.

  • Open by 9/30/2020. Customers who held an HSBC consumer deposit or investment account from June 29, 2017 through and including June 29, 2020 are not eligible for this offer.
  • 3% cash bonus on qualifying direct deposits, up to $100 per calendar months for 6 months ($600 total). The 6 calendar months begin with the first full calendar month after account opening.
  • Qualifying Direct Deposits are electronic deposits of regular periodic payments (such as salary, pension, Government Benefits or other monthly income) made into your HSBC Premier checking account from third parties at least once per calendar month.
  • Bonus arrives 8 weeks after qualifying activity. To be eligible for the offer, your HSBC Premier checking account must be open without being changed to a product with lower balance requirements, and in good standing at the time of fulfillment.
  • Limit one 3% Promotional Offer or New Consumer Deposit Offer per customer, including all individual and joint accounts — the first line name on the joint account is considered the customer for gift purposes.

HSBC Premier checking has a $50 monthly maintenance fee, unless you have one of the following:

  • Balances of $75,000 in combined U.S. consumer and qualifying commercial U.S. Dollar deposit and investment* accounts; OR
  • Monthly recurring direct deposits totaling at least $5,000 from a third party to an HSBC Premier checking account(s); OR
  • HSBC U.S. residential mortgage loan with an original loan amount of at least $500,000, not an aggregate of multiple mortgages. Home Equity products are not included.

This is not official, but to me the wording suggests that a regularly scheduled monthly ACH transfer pushed from an external bank can count as a direct deposit. The comments under this Doctor of Credit post support this. Obviously, you may want to switch over a payroll if that is an option for you. HSBC doesn’t have any high-interest bank accounts where it would be beneficial to park $75,000 (even if you had this large amount available), so this leaves the best move as making an ACH transfer of $5,000 per month into the account during those 6 months (wait to start until the next new month after opening). This triggers the full bonus and you can then withdraw the funds as you wish, as you have already done the deposits and waived the monthly fee. Limit one per customer, so you and a spouse/partner can each get a bonus, but as usual I would make two individual accounts instead of joint accounts.

The fact that you don’t keep those $5,000 monthly deposits in the account is what I missed initially, and what makes this bonus worth a second look. You can just cycle it: deposit $5k, spend/transfer out $5k, and then deposit $5k again. Now you’re earning a $600 bonus on $5,000 instead of $30,000 or $75,000 in committed cash. Even if you were loose with the math and assumed you had to keep $5,000 in the account for 12 months, a $600 bonus would be 12% annualized. Don’t downgrade your account until get the bonus!

Advance Checking (up to $240) bonus details.

  • Open by 9/30/2020. Customers who held an HSBC consumer deposit or investment account from June 29, 2017 through and including June 29, 2020 are not eligible for this offer.
  • 3% cash bonus on qualifying direct deposits, up to $40 per calendar months for 6 months ($240 total). The 6 calendar months begin with the first full calendar month after account opening.
  • Qualifying Direct Deposits are electronic deposits of regular periodic payments (such as salary, pension, Government Benefits or other monthly income) made into your HSBC Advance checking account from third parties at least once per calendar month.
  • Bonus arrives 8 weeks after qualifying activity. To be eligible for the offer, your HSBC Advance checking account must be open without being changed to a product with lower balance requirements, and in good standing at the time of fulfillment.
  • Limit one 3% Promotional Offer or New Consumer Deposit Offer per customer, including all individual and joint accounts — the first line name on the joint account is considered the customer for gift purposes.

HSBC Advance checking has a $25 monthly maintenance fee, unless you have one of the following:

  • Balances of $5,000 in combined U.S. consumer and qualifying commercial U.S. Dollar deposit and investment* accounts; OR
  • Monthly recurring direct deposits (of any amount) from a third party to an HSBC Advance checking account(s); OR
  • HSBC U.S. residential mortgage loan (of any amount). Home Equity products are not included.

You can either park $5,000 there for about 8 months, or you can make a small direct deposit of any amount each month to waive the monthly fee. However, you will need to deposit at least $1,334 each month to max out the bonus at $40 per month. Even if you were loose with the math and assumed you had to keep $1,500 in the account for 12 months, a $240 bonus would be 16% annualized. Don’t downgrade your account until get the bonus!

Which one? If you have $5,000 that you can cycle, then the $600 Premier bonus is a better use of your time as this bonus will require you to set up multiple transfers and take 8-9 months to complete. If you only have $1,500 to cycle, getting a $240 bonus is still pretty good. Bank bonuses require attention to detail, a tracking/reminder system, and patience. It helps to have that quirk where getting the equivalent of guaranteed 12% annual return on your money is “fun”. 🙂

Thanks to reader Brian M for the tip.

Filed Under: Banking, Deals & Offers, General
Last updated: August 26, 2020
My Money Blog has partnered with CardRatings and Credit-Land for selected credit cards, and may receive a commission from card issuers. All opinions expressed are the author’s alone, and has not been provided nor approved by any of the companies mentioned. MyMoneyBlog.com is also a member of the Amazon Associate Program, and if you click through to Amazon and make a purchase, I may earn a small commission. Thank you for your support.

BBVA $250 Bank Bonus: $200 Checking + $50 Savings

August 12, 2020 By Jonathan Ping 4 Comments
My Money Blog has partnered with CardRatings and Credit-Land for selected credit cards and may receive a commission. All opinions expressed are the author’s alone, and has not been provided nor approved by any of the companies mentioned.

This promotion has expired.

BBVA has a new $250 bonus promotion with a $200 bonus for opening an Online Checking account and receiving a qualifying direct deposit of $500+ by October 31, 2020. Get an additional $50 bonus by adding an Online Savings account and having a savings balance of at least $1,000 on October 31, 2020. If you want the $250 bonus, be sure to click on the “Open Both Now” button on the promotion landing page. Offer good for checking and savings accounts opened between July 24 – August 21, 2020. Checking account bonus details:

Eligible accounts include BBVA Online Checking and BBVA Easy Checking (Easy Checking available in AL, AZ, CA, CO, FL, NM, and TX only). Account must be opened online by clicking either the “Open Checking Now” or “Open Bundle Now” button above.

Online Checking account details:

  • Minimum opening deposit is $25.
  • No monthly service charge.
  • No ATM fees nationwide at more than 64,000 AllPoint®, participating 7-Eleven® and BBVA USA ATMs.
  • You will automatically receive a paper account statement by mail for a fee of $3 per month. However, you can opt for free electronic account statements and eliminate the $3 Paper Statement Fee when you turn off paper statements through Online Banking. Don’t forget to opt out!

Savings account bonus details:

You must meet stipulations for the $200 Checking Bonus to be eligible for the $50 Savings Bonus. The Online Savings account must be opened at the same time as the checking account through this landing page using the “Open Both Now Button”.

Online Savings account details:

  • Minimum opening deposit is $25.
  • No monthly service charge.
  • Currently interest rate is 0.05% APY.
  • You will automatically receive a paper account statement by mail for a fee of $3 per month. However, you can opt for free electronic account statements and eliminate the $3 Paper Statement Fee when you turn off paper statements through Online Banking. Don’t forget to opt out!

Additional bonus details:

  • We reserve the right to deduct the bonus amount if the account is closed within 12 months of opening.
  • The BBVA Online savings account holder must be an account holder on the new BBVA consumer checking account.
  • You must be a new BBVA savings customer who has not had a BBVA consumer savings account in the past 12 months or closed due to negative balance.
  • The cash bonus(es) will be deposited into the new checking account within 90 days of meeting the bonus requirements described above.
  • Accounts must be open and in good standing with a balance greater than or equal to $0.00 at the time of payment in order to receive the new account bonus(es).
  • These bonuses are not combinable with other BBVA Direct Deposit or Savings Account cash bonus promotions, and you may not have received a Direct Deposit or Savings Account Bonus in the past 24 months.
Filed Under: Banking, Deals & Offers
Last updated: September 29, 2020
My Money Blog has partnered with CardRatings and Credit-Land for selected credit cards, and may receive a commission from card issuers. All opinions expressed are the author’s alone, and has not been provided nor approved by any of the companies mentioned. MyMoneyBlog.com is also a member of the Amazon Associate Program, and if you click through to Amazon and make a purchase, I may earn a small commission. Thank you for your support.

Best Interest Rates on Cash – August 2020

August 11, 2020 By Jonathan Ping 8 Comments
My Money Blog has partnered with CardRatings and Credit-Land for selected credit cards and may receive a commission. All opinions expressed are the author’s alone, and has not been provided nor approved by any of the companies mentioned.

Is it August? The days are all melding together in the MMB household. We’ve also reached the point where anything above 1% APY is worth a second look. Being willing to switch to bank or credit union CDs can still beat out Treasury bonds and/or brokerage cash sweep options that also pay nearly zero.

Here’s my monthly roundup of the best interest rates on cash for August 2020, roughly sorted from shortest to longest maturities. I track these rates because I keep 12 months of expenses as a cash cushion and also invest in longer-term CDs (often at lesser-known credit unions) when they yield more than bonds. Check out my Ultimate Rate-Chaser Calculator to see how much extra interest you’d earn by moving money between accounts. Rates listed are available to everyone nationwide. Rates checked as of 8/11/2020.

High-yield savings accounts
While the huge megabanks make huge profits while paying you 0.01% APY, it’s easy to open a new “piggy-back” savings account and simply move some funds over from your existing checking account. The interest rates on savings accounts can drop at any time, so I list the top rates as well as competitive rates from banks with a history of competitive rates. Some banks will bait you with a temporary top rate and then lower the rates in the hopes that you are too lazy to leave.

  • Affirm has the top rate at the moment at 1.30% APY with no minimum balance requirements. I wonder how long this will last, as the rate is high but Affirm also charges really high interest to let folks buy jeans on a payment plan. There are several other established high-yield savings accounts at up to 1% APY for now.
  • Side note: HM Bradley is still advertising 3% APY for those that spent the previous quarter saving at least 20% of your direct deposit. Might be worth a gamble to open now and hope that it somehow stays at 3% APY at the next rate reset on October 1st.

Short-term guaranteed rates (1 year and under)
A common question is what to do with a big pile of cash that you’re waiting to deploy shortly (just sold your house, just sold your business, legal settlement, inheritance). My usual advice is to keep things simple and take your time. If not a savings account, then put it in a flexible short-term CD under the FDIC limits until you have a plan.

  • No Penalty CDs offer a fixed interest rate that can never go down, but you can still take out your money (once) without any fees if you want to use it elsewhere. Marcus has a 7-month No Penalty CD at 0.90% APY with a $500 minimum deposit. AARP members can get an 8-month CD at 1.10% APY. Ally Bank has a 11-month No Penalty CD at 0.75% APY for all balance tiers. CIT Bank has a 11-month No Penalty CD at 0.50% APY with a $1,000 minimum deposit. You may wish to open multiple CDs in smaller increments for more flexibility.
  • CommunityWide Federal Credit Union has a 12-month CD at 1.10% APY ($1,000 min). Early withdrawal penalty depends on how early you withdraw. Anyone can join this credit union via partner organization ($5 one-time fee).

Money market mutual funds + Ultra-short bond ETFs
If you like to keep cash in a brokerage account, beware that many brokers pay out very little interest on their default cash sweep funds (and keep the difference for themselves). The following money market and ultra-short bond funds are NOT FDIC-insured and thus come with a possibility of principal loss, but may be a good option if you have idle cash and cheap/free commissions.

  • Vanguard Prime Money Market Fund currently pays an 0.08% SEC yield. The default sweep option is the Vanguard Federal Money Market Fund which has an SEC yield of 0.10%. You can manually move the money over to Prime if you meet the $3,000 minimum investment.
  • Vanguard Ultra-Short-Term Bond Fund currently pays 0.92% SEC yield ($3,000 min) and 1.02% SEC Yield ($50,000 min). The average duration is ~1 year, so there is more interest rate risk.
  • The PIMCO Enhanced Short Maturity Active Bond ETF (MINT) has a 0.66% SEC yield and the iShares Short Maturity Bond ETF (NEAR) has a 0.86% SEC yield while holding a portfolio of investment-grade bonds with an average duration of ~6 months. Note that there was a sudden, temporary drop in net asset value during the March 2020 market stress.

Treasury Bills and Ultra-short Treasury ETFs
Another option is to buy individual Treasury bills which come in a variety of maturities from 4-weeks to 52-weeks. You can also invest in ETFs that hold a rotating basket of short-term Treasury Bills for you, while charging a small management fee for doing so. T-bill interest is exempt from state and local income taxes. Right now, this section probably isn’t very interesting as T-Bills are yielding close to zero!

  • You can build your own T-Bill ladder at TreasuryDirect.gov or via a brokerage account with a bond desk like Vanguard and Fidelity. Here are the current Treasury Bill rates. As of 8/11/2020, a new 4-week T-Bill had the equivalent of 0.08% annualized interest and a 52-week T-Bill had the equivalent of 0.15% annualized interest.
  • The Goldman Sachs Access Treasury 0-1 Year ETF (GBIL) has a 0.08% SEC yield and the SPDR Bloomberg Barclays 1-3 Month T-Bill ETF (BIL) has a -.01% (yikes!) SEC yield. GBIL appears to have a slightly longer average maturity than BIL.

US Savings Bonds
Series I Savings Bonds offer rates that are linked to inflation and backed by the US government. You must hold them for at least a year. There are annual purchase limits. If you redeem them within 5 years there is a penalty of the last 3 months of interest.

  • “I Bonds” bought between May 2020 and October 2020 will earn a 1.06% rate for the first six months. The rate of the subsequent 6-month period will be based on inflation again. More info here.
  • In mid-October 2020, the CPI will be announced and you will have a short period where you will have a very close estimate of the rate for the next 12 months. I will have another post up at that time.

Prepaid Cards with Attached Savings Accounts
A small subset of prepaid debit cards have an “attached” FDIC-insured savings account with exceptionally high interest rates. The negatives are that balances are capped, and there are many fees that you must be careful to avoid (lest they eat up your interest). Some folks don’t mind the extra work and attention required, while others do. There is a long list of previous offers that have already disappeared with little notice. I don’t personally recommend nor use any of these anymore.

  • The only notable card left in this category is Mango Money at 6% APY on up to $2,500, along with several hoops to jump through. Requirements include $1,500+ in “signature” purchases and a minimum balance of $25.00 at the end of the month.

Rewards checking accounts
These unique checking accounts pay above-average interest rates, but with unique risks. You have to jump through certain hoops, and if you make a mistake you won’t earn any interest for that month. Some folks don’t mind the extra work and attention required, while others do. Rates can also drop to near-zero quickly, leaving a “bait-and-switch” feeling. If you want rates above 2% APY, this is close to the only game in town.

  • Consumers Credit Union Free Rewards Checking (my review) still offers up to 4.09% APY on balances up to $10,000 if you make $500+ in ACH deposits, 12 debit card “signature” purchases, and spend $1,000 on their credit card each month. The Bank of Denver has a Free Kasasa Cash Checking offering 3% APY on balances up to $25,000 if you make 12 debit card purchases and at least 1 ACH credit or debit transaction per statement cycle. If you meet those qualifications, you can also link a savings account that pays 2% APY on up to $50k. (Effective with the qualification cycle beginning August 20, 2020, the rates on Kasasa Cash and Kasasa Saver are changing to 2.5% APY and 1.5% APY, respectively.) Thanks to reader Bill for the updated info. Find a locally-restricted rewards checking account at DepositAccounts.

Certificates of deposit (greater than 1 year)
CDs offer higher rates, but come with an early withdrawal penalty. By finding a bank CD with a reasonable early withdrawal penalty, you can enjoy higher rates but maintain access in a true emergency. Alternatively, consider building a CD ladder of different maturity lengths (ex. 1/2/3/4/5-years) such that you have access to part of the ladder each year, but your blended interest rate is higher than a savings account. When one CD matures, use that money to buy another 5-year CD to keep the ladder going. Some CDs also offer “add-ons” where you can deposit more funds if rates drop.

  • Connexus Credit Union has a 5-year certificate at 1.56% APY ($5,000 min), 4-year at 1.46% APY, 3-year at 1.26% APY, and 2-year at 1.11% APY. Note that the early withdrawal penalty for the 5-year is 365 days of interest. Anyone can join this credit union via partner organization for a one-time $5 fee.
  • You can buy certificates of deposit via the bond desks of Vanguard and Fidelity. You may need an account to see the rates. These “brokered CDs” offer FDIC insurance and easy laddering, but they don’t come with predictable early withdrawal penalties. Vanguard has a 4-year at 0.35% APY right now. Be wary of higher rates from callable CDs listed by Fidelity.

Longer-term Instruments
I’d use these with caution due to increased interest rate risk, but I still track them to see the rest of the current yield curve.

  • Willing to lock up your money for 10 years? You can buy long-term certificates of deposit via the bond desks of Vanguard and Fidelity. These “brokered CDs” offer FDIC insurance, but they don’t come with predictable early withdrawal penalties. At this writing, there are no available offerings. Watch out for higher rates from callable CDs from Fidelity.
  • How about two decades? Series EE Savings Bonds are not indexed to inflation, but they have a unique guarantee that the value will double in value in 20 years, which equals a guaranteed return of 3.5% a year. However, if you don’t hold for that long, you’ll be stuck with the normal rate which is quite low (currently a sad 0.10% rate). I view this as a huge early withdrawal penalty. But if holding for 20 years isn’t an issue, it can also serve as a hedge against prolonged deflation during that time. As of 8/11/2020, the 20-year Treasury Bond rate was 1.10%.

All rates were checked as of 8/11/2020.

Filed Under: Banking, Deals & Offers, Investing
Last updated: August 11, 2020
My Money Blog has partnered with CardRatings and Credit-Land for selected credit cards, and may receive a commission from card issuers. All opinions expressed are the author’s alone, and has not been provided nor approved by any of the companies mentioned. MyMoneyBlog.com is also a member of the Amazon Associate Program, and if you click through to Amazon and make a purchase, I may earn a small commission. Thank you for your support.

SoFi Money $50 + $75 Bank Bonus, $50 Stock Bonus, 10% Cashback Promo

August 1, 2020 By Jonathan Ping 53 Comments
My Money Blog has partnered with CardRatings and Credit-Land for selected credit cards and may receive a commission. All opinions expressed are the author’s alone, and has not been provided nor approved by any of the companies mentioned.

Updated bank bonus details, 10% cash back categories still active. If have you a SoFi Money account, don’t miss that they are offering earn 10% cash back on select Grocery: Whole Foods, Trader Joe’s, Instacart and Subscriptions: Netflix, Disney+, Spotify when you pay with SoFi Money from 7/1 through 9/30. Max cash back is $50 for Grocery ($500 in purchases) and $50 for Subscriptions ($500 in purchases). I like that they keep coming up with new bonuses.

If you opened a SoFi Money account prior to 6/9/2020, this is available to all members. If you opened a SoFi Money account after 6/9/2020, you need $500+ in monthly deposits (from any source, bank transfers okay) in order to qualify for the 10% cash back program. Looks like they added a new hoop with a grandfather clause, although you would need to add in some money to take full advantage of this promotion anyhow. See app for details.

Bonuses for new accounts:

SoFi (“Social Finance”) has expanded from students loans into a cash management and stock brokerage account. They’ve also updated their bonuses for trying them out, and if you have a spouse/partner, you can refer each other (in addition to other friends and family) to grow the total bonus.

SoFi Money (Cash Management Account)

  • Get a $50 cash bonus when you open a new account and fund the account with at least $500 (from any source including external bank transfer). This is my referral link. The referrer gets money too, so thanks if you use it!
  • After you receive your $50 referral bonus for funding the account with $500 from any source, you become eligible for an additional $75 bonus if you have a direct deposit within the next 30 days. Details here.
  • After joining, you can also refer your own friends and family. You will get $50 as the referrer and they will get $50.
  • FDIC-insured. No account fees. No minimums.
  • Free debit card with unlimited reimbursed ATM fees.

SoFi Invest (Brokerage Account)

  • Get a $50 of your choice of stock when you fund your account with at least $1,000. This is my referral link. The referrer gets $75.
  • After joining, you can also refer your own friends and family. You will get $50 as the referrer and they will get $50.
  • SoFi Invest allows fractional shares (“stock bits”), so you can get exactly $75 worth of Apple, etc. Trade as little as $1 at a time.
  • Sample stocks are Apple, S&P 500 ETF, or Berkshire Hathaway.
  • No trading fees.

The opening process is quick and simple. Find your referral links to refer others in the SoFi app after joining. You can open, apply, fund online and be poking around the app all in the same day.

Bottom line. SoFi is offering cash and free stock bonuses for trying out their new financial products. They can quickly add up to easy money for a minor amount of effort. A couple where one person refers the other can earn hundreds in total bonuses. They have also been consistently offering new bonus categories and various promos to keep you interested.

Filed Under: Banking, Deals & Offers, Investing
Last updated: August 12, 2020
My Money Blog has partnered with CardRatings and Credit-Land for selected credit cards, and may receive a commission from card issuers. All opinions expressed are the author’s alone, and has not been provided nor approved by any of the companies mentioned. MyMoneyBlog.com is also a member of the Amazon Associate Program, and if you click through to Amazon and make a purchase, I may earn a small commission. Thank you for your support.

Marcus Bank AARP 0.10% APY Rate Boost, CD Special, Free AARP Membership

July 29, 2020 By Jonathan Ping 4 Comments
My Money Blog has partnered with CardRatings and Credit-Land for selected credit cards and may receive a commission. All opinions expressed are the author’s alone, and has not been provided nor approved by any of the companies mentioned.

This is a multi-part deal, but you may already have some of these accounts. Marcus is the online banking arm of Goldman Sachs. AARP members are eligible for two member benefits at Marcus:

  • 0.10% APY rate increase to the Online Savings rate for 24 months. As of 7/29/20, that means 1.15% APY instead of 1.10% APY.
  • Special 8-month No-Penalty CD at 1.10% APY as of 7/29/20. Their standard No-Penalty CD is 0.90% APY for 7 months.

AARP membership is targeted at those age 50+, but there is no actual age restriction. I’ve been a member in the past, as AARP has offered a variety of member benefits that can be quite valuable. Insurance discounts, hotel discounts, restaurant discounts, and so on. If only younger folks had such a well-organized association! The standard membership fee is $16/year, but it drops to $12/year if you sign-up for auto-renewal with a credit card on file (you can still cancel at any time).

Swagbucks is a popular points website, and you can currently get 1,200 Swagbucks for joining AARP through their site. 1,200 Swagbucks is worth $12 in Amazon gift cards, which you can think of as offsetting the AARP annual membership fee. If you are a member, log in and search for “AARP”. If you are not a member yet, join via my Swagbucks referral link and earn a $3 referral bonus + an additional $10 bonus if you spend at least $25 through their shopping portal within 30 days of registration. (There are even some money-making offers on Swagbucks like donating $15 to the Sierra Club and getting 4,000 Swagbucks in return worth $40 in Amazon gift cards.)

Taken altogether, you can get the 0.10% APY rate boost, special CD access, and a year of AARP membership (including many other perks) all at zero net cost. Thanks to reader Bill P for the tip.

Filed Under: Banking, Deals & Offers
Last updated: July 30, 2020
My Money Blog has partnered with CardRatings and Credit-Land for selected credit cards, and may receive a commission from card issuers. All opinions expressed are the author’s alone, and has not been provided nor approved by any of the companies mentioned. MyMoneyBlog.com is also a member of the Amazon Associate Program, and if you click through to Amazon and make a purchase, I may earn a small commission. Thank you for your support.

US Treasury Yields Lowest In The History of the Republic

July 21, 2020 By Jonathan Ping 1 Comment
My Money Blog has partnered with CardRatings and Credit-Land for selected credit cards and may receive a commission. All opinions expressed are the author’s alone, and has not been provided nor approved by any of the companies mentioned.

Like many folks, I recently enjoyed the excellent musical Hamilton for the first time on Disney+. I’m a bit embarrassed to say it was also very educational (yes, I know its not 100% historically accurate). I never really thought about how precarious and up-for-debate everything was during the beginning of this country. If Hamilton never survived the war or wasn’t as persuasive, would there be a federal Treasury? I feel like the creator of this WSJ Daily Shot chart was also reading about US history – “US Treasury Yields Lowest In The History of the Republic”:

Alexander Hamilton was the first Secretary of the Treasury and is known as the “Father of American Banking”. Here is his Treasury website bio:

Facing a chaotic treasury burdened by the heavy debt of the Revolutionary War, Hamilton’s first interest when he took office was the repayment of the war debt in full. “The debt of the United States … was the price of liberty,” he affirmed, and he then put into effect, during 1790 and 1791, a revenue system based on customs duties and excise taxes. Hamilton’s attack on the debt helped secure the confidence and respect of foreign nations. He introduced plans for the First Bank of the United States, established in 1791 which was designed to be the financial agent of the Treasury Department. The Bank served as a depository for public funds and assisted the Government in its financial transactions. The First Bank issued paper currency, used to pay taxes and debts owed to the Federal Government.

Today, the rates on US Treasury debt are at all-time lows, while the debt-to-GDP ratio is currently higher than any time since World War II (now over 100% of GDP). The projections are from the Congressional Budget Office, made even before the events of 2020.

I will be the first to admit that I don’t understand macroeconomics. At the same time, I wish that the “experts” would admit when they don’t really know that will happen in the future either.

Filed Under: Banking, Investing
Last updated: July 21, 2020
My Money Blog has partnered with CardRatings and Credit-Land for selected credit cards, and may receive a commission from card issuers. All opinions expressed are the author’s alone, and has not been provided nor approved by any of the companies mentioned. MyMoneyBlog.com is also a member of the Amazon Associate Program, and if you click through to Amazon and make a purchase, I may earn a small commission. Thank you for your support.

Merrill Edge + Preferred Rewards = Up to $1,000 Bonus For Moving Assets, Improved Credit Card Rewards

July 18, 2020 By Jonathan Ping 25 Comments
My Money Blog has partnered with CardRatings and Credit-Land for selected credit cards and may receive a commission. All opinions expressed are the author’s alone, and has not been provided nor approved by any of the companies mentioned.

(Updated again July 2020: Let’s try this again with a non-expired link! BofA has new promotion for up to $1,000, even higher than the previous offer and worth considering if you have adequate brokerage assets to move over to Merrill Edge. Thanks to comment Ken Nand for the pointer. See updated full review below.)

Merrill Edge is the self-directed brokerage arm formed after Bank of America and Merrill Lynch merged together. They are currently offering an increased cash bonus of up to $1,000 for moving “new money” or assets over to them from another brokerage firm. This new bonus is linked to the BofA/Merrill Preferred Rewards program, which is another reason to consider using them as it gets you waived banking fees and better credit card rewards. Here’s an overview along with my personal experience as I’ve had an account with them for a few years now.

Cash bonus. Brokerage firms love to collect assets. The good news is they don’t require cash that will be earning zero interest, and Edge has no management fees if you stick with DIY. If you are holding shares of stock, ETFs, or mutual funds elsewhere, you can simply perform an “in-kind” ACAT transfer over to Merrill Edge. Your 100 shares of AAPL will remain 100 shares of AAPL, so you don’t even have to worry about price changes, lost dividends, or tax consequences. Any cost basis should transfer over too.

This specific offer is better than the standard offer:

  • $50 bonus with $20,000 to $49,999 in new assets
  • $250 bonus with $50,000 to $99,999 in new assets
  • $500 bonus with $100,000 to $199,999 in new assets
  • $1,000 bonus with $200,000 or more in new assets

Note that you must keep the assets there for 180 days. For comparison, here is an expired offer that was the highest I’ve seen. Here is the standard offer that has been around for a while.

This offer includes both IRAs and regular taxable (CMA) accounts:

Offer valid for new individual Merrill IRAs or Cash Management Accounts (CMAs). Offer is limited to one CMA and one IRA, with no more than two enrolled accounts per accountholder. Eligible Merrill Edge IRAs limited to Rollover, Traditional, Roth and Sole-Proprietor SEP only. The Merrill IRA or CMA may be a Merrill Edge Self-Directed account, Merrill Edge Advisory Account or Merrill Guided Investing account. You may be eligible for a different or better offer. Please contact us for more information.

Note that last sentence! It’s not just boilerplate. After I did this bonus once with a partial transfer (just enough to satisfy the requirements), a Merrill Edge rep contacted me and offered me a custom bonus to move even more assets over. (The bonus ratios were about the same, but higher limits.) Therefore, if you are considering this and happen to have more than $200,000 to transfer over, you may want to give them a call and see if they can offer even more money.

You can even transfer in Admiral Shares of Vanguard mutual funds that they don’t let you trade there, but you can only hold or sell them. You can’t buy more shares. You can, however, buy more shares of the corresponding Vanguard ETF if you wish. (Alternatively, you should consider having Vanguard convert your Admiral share into ETFs on a one-time basis that will preserve your original cost basis. After you have ETFs, you can move those over to Merrill Edge and trade them as you wish.)

Preferred Rewards bonus. The Preferred Rewards program is designed to rewards clients with multiple account and higher assets located at Bank of America banking, Merrill Edge online brokerage, and Merrill Lynch investment accounts. Here is a partial table taken from their comparison chart (click to enlarge):

At the Platinum and Platinum Plus levels, Merrill Edge used to offer 30 and 100 free online stock trades every month, respectively. However, now everyone gets unlimited $0 trades. Bank of America’s interest rates on cash accounts tend to be quite low, so moving cash over to qualify may result in earning less interest on your cash deposits. Merrill Lynch advisory accounts also usually come with management fees. The sweet spot is if you have brokerage assets like stocks, mutual funds, and ETFs.

Checking accounts. With Gold status ($20k in assets) and above, you’ll get the monthly maintenance fee on up to 4 checking or savings account waived. That means you no longer have to worry about a minimum balance or maintaining direct deposit, depending on your account type. You’ll also get waived ATM fees at non-BofA ATMs at certain levels (12/year at $50k assets, unlimited at $100k). Free cashier’s checks.

Credit cards rewards. With the Preferred Rewards boost, you can get up to 2.6% cash back towards travel on all your purchases on the Bank of America Travel Rewards Card. You can also get up to 5.25% cash back (on up to $2,500 per quarter) on your choice of gas, online shopping, dining, travel, drug stores, or home improvement and furnishings with the Bank of America Cash Rewards Card.

My personal experience. In terms of Merrill Edge, I’ve had an account with them for a few years now and my lightning review is that they have a “okay/good” user interface and solidly “good” customer service (i.e. real, informed humans available 24/7 on the phone, not email-only customer service that takes hours to days like Robinhood). I would add that I am not an active trader and only make about 10-15 trades a year. I have been quite satisfied with the account. I can also move money instantly between my Merrill Edge and Bank of America checking accounts, making it easy to sweep out idle cash into an external savings account.

The biggest financial benefit to this BofA/Merrill Edge combo has probably been the 75% boost to their credit card rewards, allowing me to get 2.625% cash back on basically all my daily purchases. The second biggest benefit has probably been this cash bonus, and the third is the occasional waived checking or ATM fee. One negative is that the cash sweep options are not very good, but as of July 2020 the interest difference is quite small.

Bottom line. Merrill Edge is currently offering up to $1,000 if you move over a significant amount of assets to their self-directed brokerage. This can simply be mutual fund or ETFs shares currently being held elsewhere. When you keep enough assets across Bank of America and Merrill Edge, their Preferred Rewards program can offer ongoing perks like waived bank account fees and boosted credit card rewards.

Filed Under: Banking, Credit Cards, Deals & Offers, Investing
Last updated: July 20, 2020
My Money Blog has partnered with CardRatings and Credit-Land for selected credit cards, and may receive a commission from card issuers. All opinions expressed are the author’s alone, and has not been provided nor approved by any of the companies mentioned. MyMoneyBlog.com is also a member of the Amazon Associate Program, and if you click through to Amazon and make a purchase, I may earn a small commission. Thank you for your support.

Bask Bank Review: Earn American Airlines Miles As Interest (5,000 Mile Referral Bonus)

July 6, 2020 By Jonathan Ping 7 Comments
My Money Blog has partnered with CardRatings and Credit-Land for selected credit cards and may receive a commission. All opinions expressed are the author’s alone, and has not been provided nor approved by any of the companies mentioned.

Updated with my own experience and new referral bonus. Bask Bank is a FDIC-insured savings account that pays you American Airlines (AA) miles instead of cash interest. Every $1 earns 1 mile a year. For example, $1,000 kept for a year would earn 1,000 AA miles at the end of the year. If you kept $50,000 there for a year, you would earn 50,000 AA miles at the end of a year. There is no minimum balance and no monthly fees. I’ve updated this review after opening an account.

Bask Bank is part of Texas Capital Bank (FDIC Certificate #34383), which also runs BankDirect. BankDirect has been giving out American Airlines miles for many years on their checking account, but with different requirements and a steep monthly fee. Note that they are all the same bank in regards to the $250,000 FDIC insurance limits per depositor type. Bask Bank routing number is 111026177.

Account opening process. Opening an account was done all online with no issues, with no physical paperwork to send in. They state there is no hard credit check upon opening, and there was none upon my own opening. I received all my promised points (past bonus and monthly interest) on time and without issue. Note: They do not currently offer joint accounts.

Value calculations. If you valued American Airlines miles at 1 cent per mile, then this account would earn you the equivalent of 1% APY. ($10,000 a year = 10,000 AA miles = $100 value.) Given that other online savings accounts also earn about 1% APY nowadays, this has become a closer call after you consider the tax consequences…

1099-INT details. If you get miles instead of cash, what happens at tax time? Bask Bank and BankDirect has stated that they plan to issue 1099-INT for 2020 interest earned based on a valuation of 0.42 cents per mile. This can be found deep in their disclosures:

Since you are Awarded Miles based on the average collected balance in your Account each month instead of interest, Bask Bank calculates an interest equivalent based on a good faith estimate of the value of the miles. Your interest rate and annual percentage yield may change based on a change in either the Miles Award Rate or the estimated value. Miles are currently valued at 0.42 cents per mile, the equivalent of 0.42% annual percentage yield.

So if you held $10,000 for all of 2020 and earned $10,000 miles, current your 1099-INT will show $42 in interest paid. However, this is subject to change and I don’t really like that sort of uncertainty. It is unlikely but still possible that they could change this number and it would be a hassle to dispute such a valuation.

Useful for keeping your AA miles active. Airline miles are useful, but also subject to rampant inflation. Since AA miles are worth less every year, I do not plan on using this as my main savings account. However, the ability to keep about $15 in there and earn at least 1 mile per month to prevent my existing American miles from expiring, that could be useful. If I need a certain amount of American Airlines to reach an award, this may be a backup option as well. I have a large amount of AA miles, so this account gives me peace of mind that they won’t suddenly expire when I’m not paying attention.

New account referral bonus. Bask Bank now runs a refer-a-friend program where if the person referred opens an account by 9/30/2020, deposits at least $10,000, and keeps it there for 90 days, they will earn 5,000 AAdvantage® bonus miles on top of the usual interest. The referrer will also then receive 5,000 miles. Here is my Bask Bank referral link, thanks if you use it. After you open the account, you can also refer up to 5 friends yourself:

If you again value an AA mile at 1 cent a mile, then the bonus is worth $50. Earning $50 for keeping $10,000 there for 90 days is the equivalent of a bonus APY of 2% for those 90 days. So in total, you might get the cash equivalent of 3% APY over those initial 90 days with the referral bonus if you use that 1 cent per mile valuation.

Bottom line. Bask Bank is an online savings account that pays you American Airlines (AA) miles instead of cash interest. It won’t be a great fit for everyone, but may be interesting to those that can maximize the value of an American Airlines mile. You may also like the ability to keep all your AA miles from expiring by keeping a small amount of cash at the bank.

Filed Under: Banking, Deals & Offers
Last updated: August 12, 2020
My Money Blog has partnered with CardRatings and Credit-Land for selected credit cards, and may receive a commission from card issuers. All opinions expressed are the author’s alone, and has not been provided nor approved by any of the companies mentioned. MyMoneyBlog.com is also a member of the Amazon Associate Program, and if you click through to Amazon and make a purchase, I may earn a small commission. Thank you for your support.

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