Bonus Whoring: A Critical Review
Posted on October 19, 2006 by Her and tagged reviews, rewards
As consumers, we are constantly bombarded with enticing bonuses/gifts/rewards for joining/opening/using a product or service. We've completed several of these offers with varying degrees of success. Here's how the cookies crumbled.
What we did:
Opened an unnecessary checking account
What we got:
$125 cash, deposited into the account in $25 monthly increments
Degree of hassle:
High. Completing this offer required us to change our direct deposit at work, maintain two accounts at a bank with no local branches, tie up a hundred dollars a month, sign up for a complicated online banking access, and wait half a year for the rewards.
Would we do it again?
Maybe. But next time we'd make sure we have a use for the bank's services and access to a real teller.
What we did:
Purchased a winter's worth of canned vegetables (on sale and with coupons) in one grocery trip
What we got:
Two free movie passes
Degree of hassle:
Minor. The biggest challenge was hauling it all in from the car.
Would we do it again?
Absolutely. The free movie certificates worked like cash and allowed us to have a guilt-free date night. And we made good use of the bargain vegetables too. Two movie tickets would have cost more than we paid for the vegetables!
What we did:
Transferred a big balance to a credit card that requires two monthly purchases (no minimum dollar amount required)
What we got:
Zero percent interest on the transferred balance and the new purchases until we completely pay it off (or forget to make two purchases a month)
Degree of hassle:
Huge. Keeping track of the purchases is tricky because you have to hit that sweet spot in between billing cycles to make sure they both get credited in time. The enormity of the consequences for missing a purchase is so great that it causes stress.
Would we do it again?
Probably not. In our case, it allowed us to save hundreds of dollars in interest, and we have a timeline of when it will be paid off. But even with careful management the stress level is just too high for my taste.
What we did:
Opened a low-interest, low-minimum-balance-required savings account
What we got:
$50 cash bonus
Degree of hassle:
Medium. Opening the account was easy, but shuffling money around at every payday was annoying. And after the initial bonus was awarded, the interest was too low to make it worthwhile and we had to close the account.
Would we do it again?
Yes. The bonus we earned initially offset the low interest rate. Because we closed it early and kept only the bare minimum in the account, we came out ahead.
What we did:
Spammed our friends with credit card offers and similar promotions through a referral website (one of those "get five friends to complete offers, and you get a prize! websites)
What we got:
An ipod
Degree of hassle:
Low. It didn't take long to get five friends to complete offers, and we received the ipod shortly thereafter
Would we do it again?
Absolutely not. Even though it was easy, we felt kinda dirty afterward. It isn't cool to ask your friends to sign up for crappy offers just so you can get a prize. Nobody seemed to mind, but we know it wasn't the right thing to do.
The bottom line: there are some things (like your time and some minor annoyance) that are reasonable trade-offs. But you should never sacrifice your relationships or morals for an easy buck.
Comments/Trackbacks
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I learned my lesson years ago on these so called "Great Offers." The business is offering them because they know it will cost you more in the long run.
This site has some good tips. Its aimed at bankrupt people, but is valuable for anyone building credit.
LifeAfterBankruptcy.com
Lazy Man and Money | Oct 19, 2006
Another idea with the credit card would be to set one day aside in the week to make two small purchases. Perhaps you go to McDonald's and get one item off the dollar menu and then hand it to your husband and gets an item off the dollar menu. You've got instant dinner and fulfilled your quota without adding to the debt on the card.
I think that deal is definitely worthwhile if you carry a balance.
Most 0% balance transfer offers I've seen take any payments off the 0% balance first, so any purchases made after the transfer will rack up the standard interest charges until the 0% balance is paid off in full (at the end of the offer period). Did this apply to the two purchase trans you had to make for the 0% offer? If so, then you'd have been making some very small purchases just to meet the requirements. It would still be worth it to save interest on the large, transferred balance - but an offer that has no transfer fee and no such purchase requirements is much better.
Here I can use my credit card to make small (
D | Oct 19, 2006
On the credit card that requires 2 charges a month, could you have set it up so 2 of your regular bills went here? Say cable & cellphone or something like that? or do they require a point of sale charge?
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