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Savings Account Bonus Offers Increase

Man holding arms out as money floats down from the skyBanks are increasingly offering financial incentives in an attempt to get us to deposit our hard-earned cash.

Research firm Mintel Comperemedia, which tracks bank direct mail solicitations, found 40% of all savings account offers sent in the mail last year included a cash incentive, compared with 32% in 2011.

That increase looks even larger considering the total number of savings account solicitations nearly tripled in 2012.

Those cash bonuses ranged from $25 to $250, says Susan Wolfe, Mintel’s vice president of financial services.

“A lot of the offers are going to more affluent customers,” Wolfe says, and many of the offers are extended to people who already have a relationship with the bank or credit union.

To get big-buck bonuses usually requires big-buck deposits, so you might have to deposit $15,000 or $25,000 to get a $150 or $250 bonus.

The big banks, in particular, have turned to savings bonuses after finding success offering bonuses for opening checking accounts, Wolfe says.

Now they’re “really trying to instill loyalty among their customers,” she says.

The more financial ties a customer has with a bank, the more hesitant they are to transfer their business to another financial institution.

A backlash against big banks over fees and poor customer service prompted nearly one in 10 customers to switch banks in 2011, a report by J.D. Power and Associates found.

While a $250 cash bonus is certainly enticing, savers must keep in mind these banks generally pay paltry savings rates, particularly compared with online banks and even some community banks and credit unions.

The best nationally available savings accounts pay 1% APY or more, about 10 times better than what the typical savings account pays.

Wolfe says big brick-and-mortar banks have been offering savings account bonuses as a way to try to remain competitive with online banks.

Here are some of the 2013 bonuses we found online:

U.S. Bank (www.usbank.com), headquartered in Minneapolis, offers a Savings Today and Rewards Tomorrow (S.T.A.R.T) package. Earn a $50 Visa gift card when you have $1,000 in your savings account, link your checking and savings account and make regular transfers from checking to savings. Keeping that $1,000 in the account for another year will earn you another $50 gift card.

Regions Bank (www.regions.com), based in Birmingham, Ala., has a similar offer. Linking a LifeGreen Checking and LifeGreen Savings account can earn you up to a $100 bonus if you have regular transfers for a year.

Citizens Bank (www.citizensbank.com) in Providence, R.I., has a College Saver Savings Account that will pay you a $1,000 bonus, plus interest, if you open an account before your child’s 12th birthday and make regular deposits into the account.

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