Should you switch banks for a bank account bonus?
Key takeaways
- Bank account bonuses can be a great way to supplement interest on a bank account.
- Be aware that just like ordinary interest income, bank account bonuses are taxed.
- Make sure you understand the conditions you must meet to earn the bonus.
- Moving money into a new account for a bonus might not be worth it if you make less in interest over time or struggle to juggle multiple accounts.
Switching banks can pay off — literally, if you qualify for a bank account bonus. Banks offer bank account bonus promotions to encourage you to open an account. These bonuses tend to range from around $200 to $3,000, depending on a number of factors, including the amount of your initial deposit.
More money is hard to resist, but read the fine print first. Changing banks to chase a bank account bonus could mean inconvenience — and it might even lose you money in interest over time.
The good
1. It means more money in your pocket
Bank account bonuses can be a great way to earn money in a low-yield environment. Or they can be a great way to earn even more money in a higher-rate environment, like we’re in now. Depositing more money thanks to a bank account bonus means earning more interest, sooner. And if your new account offers a higher annual percentage yield (APY) than your old account, in addition to the bonus, that’s even better.
2. It’s an excuse to try a new bank
[Learn more: Best mobile banking features: What to look for in your banking app]
U.S. adults keep the same primary checking account for an average of 19 years at banks or credit unions with brick-and-mortar locations, according to Bankrate’s 2025 Checking Account Survey.
Think about how much things have changed in that time. Some of Bankrate’s best high-yield savings accounts — at online banks such as Bask Bank and Jenius Bank — didn’t exist 19 years ago. Banks now commonly offer peer-to-peer transfers through services like Zelle (launched 2017) and sophisticated banking apps. Is your current bank stuck in the past?
Sometimes you don’t know how much better a product or customer experience could be until you try it. A new-to-you bank might offer more ATMs, a convenient banking app or even fewer overdraft fees and monthly service fees. Opening a new account for a bonus might be your ticket to a better banking experience.
Consumers often have long-term relationships with their bank. So it’s a good idea to pursue a bank account bonus at a financial institution you plan to stick with, since closing accounts or monitoring multiple accounts can be a hassle. If it’s time to quit your long-term relationship with your bank, read Bankrate’s guide on how to break up with your bank.
3. A bank account bonus is usually fixed
Other than an introductory annual percentage yield (APY) or a promotional rate, savings yields are usually variable. A bonus, on the other hand, tends to be fixed. Generally, following the rules and guidelines and keeping your account open for a certain period of time will earn you the promised bonus. Banks may have wording that the offer is subject to change, but they usually pay the amount in the offer if all the criteria have been met.
The bad
1. You’ll pay taxes on the bonus
If the bonus is over $10, your bank will likely send you a 1099-INT or 1099-MISC form, says Rachel Ivanovich, enrolled agent and wealth advisor at WWM Financial in Carlsbad, California. The United States typically counts bank bonuses as interest income, which is taxed at the same rate as your ordinary income.
Some people in higher tax brackets may also have to pay a Net Investment Income Tax on their bank account bonus, Ivanovich says.
2. There will be fine print
Failing to know and follow the offer’s terms could stop you from receiving your bank account bonus.
“It’s imperative to make sure that anyone considering an account bonus understands the boxes they need to check in order to receive that bonus,” says Andy Mardock, certified financial planner, founder and president at ViviFi Planning in Bend, Oregon.
Common stipulations include:
- Keeping an account open for a certain period.
- Receiving a minimum direct deposit within a specified period (for example, at least $1,000 within the first 90 days).
- Never having an account at a bank. Or not having an account at a bank for a certain period.
- A new money requirement — meaning money deposited into the account needs to come from outside of the bank.
Pay particular attention to direct deposit requirements — make sure you have enough income to comfortably meet those requirements before going to the trouble of opening a new account.
3. Swapping a better yield for a bonus can be a bad trade
Bank account bonuses are exciting, but especially with savings accounts, what your money earns is more important in the long term. Bankrate’s national average savings account yield is 0.6% APY, as of March 20, 2026, and many big banks pay out even less. But the highest-yielding savings accounts are paying more than 4% APY.
Crunch the numbers to see whether it’s worth moving your money.
Imagine you move $10,000 from Account A, earning 3.5% APY, to Account B, offering a $200 bonus and 0.02% APY. After one year, your total balance in Account B is about $10,202 — you’ve earned about $2 in interest on top of the bonus. Had you left the money in Account A, your balance would be $10,350 thanks to interest alone.
Many checking accounts earn zero or very little interest, but watch for monthly maintenance fees that chip away at your funds.
4. Switching accounts or adding a new account can mean headaches
Changing every bill payment to your new bank might not be something you want to do. Not strategizing how you change your direct deposit — by closing your old account too early — may also result in a delay of getting your money. Even if you leave your old account open, adding an account means more responsibilities. It’s important to regularly monitor your accounts. You’ll have to track which bills are being paid from which account and ensure you keep sufficient funds in each to avoid fees. The more accounts you have, the harder it is to keep track of them all.
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