April Bank Promotion: $250 from Fifth Third Bank

Disclaimer:  I am in not associated with Fifth Third Bank in any way, and the links I’m posting will not bring any personal profit to me.  In addition, I have not done this promotion, and I can’t because it requires a branch and I don’t have one within a reasonable radius from my location, so I cannot speak to the ease of getting them to pay.

I’m just trying to show what is out there is terms of quick and easy bank bonuses and how I approach them.

One thing to be aware of with bank bonuses is that they differ from credit card bonuses in one significant way…  Bank bonuses are taxable.  You will get a tax form with a checking / savings promotion.  You will not get a tax form from a credit card promotion.  With that said, I did not include tax liability in the analysis that is to come.

On with the promotion.

I came across this promotion from Fifth Third Bank today, and I thought it might be worth your attention.

You can check out the offer here:

https://accounts.53.com/banking/offer/checking?cid=vurl:53:AO18_Checking:get200

Read the terms and conditions.  I cannot say this enough… The terms and conditions are the rules you need to follow that leads to your wallet growing fatter.  You need to know the rules of the game you are playing.  It’s no different than a casino game.

Now, if it were really a situation where you could put $500 in a checking account and have a $750 balance 60 days later, you would have a 300% annual return…  However, it is not quite that good…  Banks charge fees…

Here are some details on their “essential” checking account, a qualifying product for this promotion. 

Notice you will absorb an $11 monthly fee if you deposit less than $1,500.  That means you need to make a $511 deposit and an additional $11 deposit every month if you are trying to maximize the return on your investment and still meet the bonus requirement of maintaining a $500 daily balance.

When I read the terms and conditions, it was not explicitly clear on when exactly I would be paid and how long I would need to maintain the account.  That makes a difference because now I’m not 100% sure on exactly how many $11 fees I need to pay.  My experience is that banks are a little slow paying out. 

The only other option I have is to put $1,500 in the account, which waives the monthly $11 fee.

Here a model of the two options and the annualized return based on how long it takes the bank to pay.

Assuming you get the bank to pay in the first year, notice that it is always better to pay the $11 fee if your goal is to maximize the return your money is making. 

Simple right?  Not so fast…

Using the $11 fee plan means two things.  1) You have to remember to make an $11 deposit every month or you blow the promotion and risk getting nothing.  2)   You actually get less and less money as the $11 dollar fees dig into your margin.

With that said, what I would do is deposit the $1,500 and set a reminder on my calendar for deposit date + 60 days to start calling the bank.  Here is why:

-          It is much easier.

-          I am happy with a return of 30%+.

-          I get $250 at the end of the day no matter how long it takes.