Your Bank Bonus Plan

This chapter pulls the series together. The other chapters each answer one question about a bank account bonus. This one puts the answers in a single page you fill in for one offer, then keep. It does not rank any offer. Credit card bonuses are out of scope.

How do you start this plan?

• You are looking at one offer and have not applied. Fill in checks 1 to 6 and decide before you move any money.
• You already opened an account. Start at the step-and-date record in check 7, then fill the checks backwards to see whether the plan still holds.
• You have two offers open at once. Give each its own page, and read the pacing rule in check 7 so their deadlines do not collide.
• You are not sure you want to do this at all. Run checks 1 to 4 on paper. If the answer is not clearly positive, you can stop there.

Check 1: What is the net return?

A bonus pays you for tying up money and meeting conditions. Its return is the net bonus (the bonus minus fees during the hold) divided by the average balance you actually keep in the account, scaled to 365 days. It is a simple yearly figure, not an interest rate you could earn on a savings account.

The worked plan below uses a hypothetical Bank A. The bonus is $400. The hold is 90 days, counted from opening until the bank pays the bonus. You tie up an average of $4,000. Fees during the hold are $15. All of these are round numbers for illustration.

The result is high because the money is tied up for only a quarter of a year, and the figure is not a rate you can earn repeatedly. It says what this hold pays on this balance. What a Bank Account Bonus Really Pays shows the same bonus on a larger balance, where the percentage collapses.

Check 2: Does it beat leaving the money in savings?

The money in the bonus account could have been earning a savings rate. Bank Bonus vs High-Yield Savings compares the two. At a hypothetical 4.00% savings rate, $4,000 earns $39.45 in 90 days. A bonus account that pays no interest forgoes that amount, so the advantage is the net bonus minus the forgone interest.

The 4.00% is a placeholder, not a current rate. In your own plan, use the live rate shown by the rate tool on the savings page, and rerun the number the day you decide. The savings rate at which the two would tie is 39.03%, far above any real savings rate, so in this example the bonus pays more on the money tied up. A larger balance or a longer hold shrinks that margin.

Check 3: What is it after tax?

A cash bonus is generally taxable income. The tax depends on your bracket and your state, so the plan asks you to supply your own rates. This example uses a hypothetical 22% federal rate and a hypothetical 5% state rate, for a combined 27%.

The interest forgone is taxed here at the same rate because savings interest is taxable too, so both sides move together. The model treats the whole bonus as ordinary income, ignores local taxes and does not know your actual bracket. How a bank reports the bonus differs by institution, so check the form you receive; the income is reportable whether or not a form arrives. This is information, not tax advice, and a tax professional can answer for your situation.

Check 4: Is it worth your hours?

List the hours the whole process takes: reading the terms, applying, funding, moving a direct deposit, tracking and closing. The hours and the value of an hour are your inputs. This guide does not suggest a correct value for your time.

In the worked plan, the process takes 4 hours and the reader values an hour at $25.

On these inputs the result is above the reader's own hourly value. The model does not price the failure case: one missed step can reduce the bonus to zero while the hours are still spent. If a requirement is hard for you to track, count that risk before you count the margin.

Check 5: Can you actually receive it?

Eligibility comes before everything else in practice, because a bonus you cannot receive has no value. Read the offer's own clause for the new-customer test, the lookback (how far back the bank checks for an account you held before), any limit per person or per household, and any state or branch restriction. Write each answer on the page, in your words, with the date you read the terms. If you are unsure whether a past account counts, ask the bank in writing and wait for the answer before opening.

Check 6: What are the requirements, and what is the hold?

Write each requirement as a line: what, how much, by which day, and how the bank counts it. Then write the hold: the day the clock starts, the day the requirement must be complete, the day the bonus should post, and the day you may close. Direct Deposit Thresholds and the Hold covers what counts as a qualifying deposit, and Clawbacks, Closures and Traps covers what loses the bonus after you have met the target. The hold runs until the bank pays, not until you meet the target.

Check 7: How do you pace and track it?

Pacing means spacing the steps so that deadlines never overlap and each requirement can be met on its own. If you have more than one offer in progress, put every date on one list and look for two deadlines within the same week. If a direct deposit change for one offer lands in the same cycle as another's target, one of them is at risk. A simple rule is that a new offer waits until the previous offer's plan reaches its close-out step.

Tracking means putting the dates where a reminder will find you. The deposit-bonus tracker in your dashboard at /dashboard/tracking holds the bank, the bonus, the target, the opened date and the deadline. It requires an account. It emails a reminder 14 days and again 3 days before the deadline. It does not connect to your bank, so you update the amount yourself and confirm that the bonus posted.

You can also run the numbers on one offer in the calculator below, which covers the bonus, the months required, a monthly fee and a tax rate. It does not include the money tied up or the savings crossover, which is what checks 1 and 2 add.

The one-page plan

Copy this table, fill it in for one offer and keep it with the offer's saved terms. The right-hand column shows the Bank A example from this chapter, hypothetical throughout.

The dates in the example are days from opening the account. They are placeholders. In the example the bank pays on day 90, so the 90-day hold in check 1 runs to that day, and the check and close-out come after it. Use the offer's own deadlines, and pick the payout and check dates from what the terms say about payout.

Close-out

Plan the last step as carefully as the first. Confirm the bonus has posted and matches the offer. Check any period after payment that your terms say the account must stay open. Save the date and amount for your tax return, because a form may be sent to an address you no longer use. Move direct deposits and payments, then close the account, then mark the tracker entry complete.

Limits of this guide. The plan does not choose a bank or rank an offer. It uses only the numbers you enter, and it cannot see inside your bank, so you confirm the posted amounts. The tax step is a simplification, not tax advice. The savings rate is a placeholder until you replace it with a live one. Skipping an offer is a valid decision.