More about bank bonuses
What does the Fed rate increase mean for bank account bonuses?
In December, the Federal Reserve announced it would not raise the federal funds rate (the rate which commercial banks use to borrow and lend money to one another). The Fed last increased the rate in July, which was the fourth change this year. The Fed also increased the rate seven times in 2022. The changes haven’t directly affected bank bonuses, but it could be a good time to open a new bank account because recent Fed rate increases have resulted in higher savings account interest rates. So you could take advantage of both a bank bonus and higher APYs in a new savings account.
Are bank account bonuses worth it?
Bank promotions can be worth the effort of opening a new account and adding money if the reward is substantial enough and the requirements aren’t too difficult to meet. Before signing up for a new account to earn a bank bonus, understand the details including what fees might be incurred and how long you might have to wait for the bonus to be paid. Check out more things to look out for when considering a bank sign-up bonus.
What do the best bank bonuses have in common?
The best bank promotions offer the opportunity to earn a significant cash bonus for signing up for a new account with no fees or fees that are easy to get waived.
Are bank bonuses taxable?
If you’ve earned a cash bonus for opening a new bank account, it’s usually taxable. You are responsible for covering any tax liability.
Should I have more than one checking or savings account?
It can be helpful to have multiple bank accounts — as long as you can meet the requirements and minimums in order to avoid fees.
The number of checking and/or savings accounts you should have depends on your individual situation. Married or partnered people, for example, might each want to have their own accounts in addition to one or more shared accounts. You might want to consider having accounts at different financial institutions for different purposes — such as having an account with a bank that works well for international travel if you’re frequently abroad, or with the bank that handles your mortgage or other loans for more seamless payment transfers. (Learn the signs that it’s time to choose a new bank.)
» Looking for the right place to keep your savings? Check out NerdWallet’s picks for the best savings accounts