Bank promo APY vs a cash sign-up bonus
1 min read · Bank bonuses, Strategy
A promotional APY is a temporary interest rate on a balance. A cash bank bonus posts once after you meet deposit or balance rules. Put both on the same parked cash and the same number of days, after fees, then pick the larger net. Do not compare a headline APY to a headline bonus in isolation.
Banks sell two different promotions that feel alike in an ad. 1
One is a rate. The other is a cheque.
Promo APY in one line
Interest = balance x APY x days / 365, before tax, while the promo lasts. A 4.5% promo on $10,000 for 90 days is about $110.96 before tax if the rate applies the whole window. When the promo ends, reprice at the ongoing rate.
Cash bonus in one line
Net the bonus against fees and compare it to what the same cash earns elsewhere over the committed days, which is the method in Is a bank bonus worth it? and the ROI calculator. 3
A $300 bonus that forces $10,000 for 90 days with no fee is 300 / 10,000 x 365 / 90, or about 12.2% annualised before tax.
Same cash, same days
Put both offers on identical principal and identical days. Add FDIC insurance context for where the cash sits, not as a return. 1 Apply your tax rate to interest-shaped income with the tax calculator or Publication 550 for the category. 2
Fees and traps
Monthly fees, wire fees, and early-close clawbacks hit both structures. A promo APY with a $12 fee can lose to a smaller bonus with a clean waiver. Read the waiver line the way you read a minimum spend on a card.
Practical pick
Choose the promo APY when you want liquidity and a clean rate sheet. Choose the cash bonus when the annualised figure clears savings and you can meet the deposit rules without stress. Choose neither when the hold wrecks cash you need for rent.
Common questions
Can I take a promo APY and a cash bonus on the same bank?
Sometimes the promo rate and the cash bonus sit on different products or exclude each other. Read both term sheets. Do not assume they stack.
What happens when the promo APY ends?
The account usually falls to a standard rate printed in the disclosures. Move the cash or accept the lower rate; the teaser is not permanent.
Which is better for short parking?
Short windows with large cash bonuses can beat a modest promo APY. Long holds with small bonuses often lose to a strong promo rate. Run the days.
Sources
CardLab tracks the cards you hold and the bonuses you are chasing, with every rate read from the issuer's own page.
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