Posted by William Charles on November 17, 2017
Credit Cards

Published on November 17th, 2017 | by William Charles

22

Chase Considering New Redemption Option Investment Account Deposit & Ultimate Rewards Bonus For Opening An Investment Account

Chase has been sending out a survey via their customer panel and they are:

  • considering adding a redemption option to Ultimate Rewards… you would be able to invest the cash equivalent of your points into an investment account where you can use the money to purchase stocks, mutual funds, ETFs, etc.

In the same survey they said they are considering an Ultimate Rewards bonus for opening an investment account. Tiers as follows:

  • 20,000 Chase Ultimate Rewards points for $25,000 deposit
  • 40,000 Chase Ultimate Rewards points for $50,000 deposit

Chase has identified one of their key competitive advantages over American Express is their product offerings are more diverse and they can use this for cross selling purposes. We’ve already seen this with them offering Chase Sapphire Reserve customers 50,000 points for becoming Chase Private Client customers. This would be another extension of this type of cross selling and I expect it to become a lot more of a focus for Chase as they try to recoup some of the marketing expenses involved especially with customer acquisition costs involved in the Chase Sapphire Reserve in particular.

From a consumer stand point being able to redeem Ultimate Rewards points towards investment accounts wouldn’t make any sense unless the rate was more than 1¢ per point as that is the current cash out rate. You’d hope it would be at least 1.25¢ as that’s what the Charles Schwab co-branded Platinum card offers (although that is effectively just cash even though it’s in an investment account), Chase Sapphire Reserve cardholders would be right in hoping for 1.5¢ as that’s the rate they get when redeeming for travel via the Chase travel portal. I don’t see that being an option, but who knows Chase might surprise us all.

The other way other card issuers have tried to convert credit card holders into investment account holders is by offering increased earning rates, Bank of America does this with their Preferred Rewards program. Citi also offers these types of relationship bonuses.The investment account bonus isn’t terribly exciting either, we used to post brokerage bonuses but stopped because most of the time the effort involved wasn’t worth it especially when you take into account the higher fees most of these places are charging. If Chase offered an investment account redemption option what would the rate have to be for you to consider it?

Hat tip to suuuuuu & MendZik on /r/churning



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22 Comments on "Chase Considering New Redemption Option Investment Account Deposit & Ultimate Rewards Bonus For Opening An Investment Account"

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JT
JT

Cash out @ 1.25cpp sign me the f**k up! One can hope.

Brad
Brad

Same as MR with Schwab Plat.

Wes
Wes

Yep, that is the key way to cash out MR.
Btw, if one holds over 250K in Schwab, the Schwab Plat.annual fee is 100 bucks lower.

LC
LC

Being around 30/24 and no anticipating of slowing down, this may be the only plausible way that I’ll be able to earn a big lump sum of Chase UR points ever again!

Dan
Dan

Don’t scare the kids

Credit
Credit

What’s your credit score?

Jon
Jon

30/24?? Why??

Terri Clark
Terri Clark

Lol why not? I agree, I would park some money with Chase to earn a pile of UR points as opposed to having it sit elsewhere earning very little.

BW
BW

I’d do it in a second as long as the stipulations don’t suck.

Cain
Cain

It all depends on the rates and additional perks. Preferred Rewards got me to transfer. If Chase was better I’d consider transferring again, but I don’t have any Chase branches nearby so that could make me hesitate as some of the perks really only apply in branch with Preferred Rewards.

bob
bob

i do enjoy the ability to travel on SWA for free with a quick transfer (or a Hyatt hotel), but goddamn: if i can dump my 600K UR for a quick $7200 cash, that would be tempting.

Especially since i don’t travel enough to really burn thru them – and i have enough points with each program already (especially other airlines) to cover me for a while.

And once i dump them, i can start fresh with a CSR bonus and have a goal to work toward again 🙂

NoonRadar
NoonRadar

How long have you been sitting on 600K UR for? Any worry of losing them in a sudden Chase shuts down scenario?

anne
anne

I will be happy to deposit 50K into Chase investment account if they offer it. Anything that can adds up to my United or American miles, I will take it. Three of us in the family travel to Asia every summer, so I really chase all these points if possible.

Steve tx
Steve tx

I have a Chase self-directed investment account, I had to open in branch but only 1 phone call from the advisor afterwards. It was mainly opened to keep the checking account fee free after signing up for a $700 bonus last year (savings and checking). The interface is lacking and with the trade fees I wouldn’t recommend using it for more than buy and hold or index investing.

With a real sign up bonus, aside from CPC, I would absolutely add some funds to the account.

BW
BW

Are there any kind of fees for the account itself? (regardless of the investments you hold)

Ian
Ian

See the Fee Schedule for Self Directed Investing Accounts. $50 AF; waived with $25k+ balance. IRA and SEP is $30AF; $10k balance waives fee. Stocks,ETFs $5 online.
https://www.chase.com/content/dam/chase-ux/documents/personal/investments/commission-schedule-self-directed-accounts.pdf

Lisa
Lisa

i think most self directed brokerage accounts have no monthly fees.

ktenorman
ktenorman

Glad I heard this before transferring to Merrill Edge for BoA. Definitely still planning on transferring from TD Ameritrade after the commission free ETF change, but may wait to see what Chase offers.

Credit
Credit

What commission free ETF change?

Jim
Jim

TDA’s removing Vanguard and iShares ETFs from their commission-free list, adding some less attractive options.

https://research.tdameritrade.com/grid/public/etfs/commissionfree/commissionfree.asp
https://www.tdameritrade.com/retail-en_us/resources/pdf/grid_etfs2017.pdf

Reportedly, from the Bogleheads thread, they weren’t willing to pay/keep paying TDA subsidies. Lots of folks complained, so TDA delayed the change for a bit, and are allowing some institutional/large investors to still trade them without commission.

Zach
Zach

if 1.25x or greater multiple on the points I would surely consider it. 1x would be a non starter.

TheMonkeyTech
TheMonkeyTech

Hope they do the 40,000 Chase UR for 50k deposit. I used to do the fidelity United deal every year but looks like Fidelity is no longer having those promos.

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