Posted by Chuck on December 19, 2017
Bank Account Bonuses

Published on December 19th, 2017 | by Chuck

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Opening a Schwab Brokerage, Checking, and Amex Platinum Credit Card before Year’s End

Recently, there’s been some chatter about the Schwab credit card and brokerage bonuses. Last month, I finally got around to starting a relationship with Schwab by signing up for their brokerage account, checking account, and the Schwab Amex Platinum credit card.

The biggest push for me to go down this road is the ability to easily cash out Membership Rewards points at a 1.25¢ value. Another cool thing about Schwab, unrelated to their credit card, is that they offer a checking account which has no-fee foreign ATM withdrawals when using the linked debit card.

Let’s recap the important points about these accounts. I’ll also detail the signup process and what needs to be completed before year’s end.

Starting a Schwab Relationship

While some relationship Amex Platinum cards don’t actually require a relationship (like Mercedes Benz ), the Schwab Amex Platinum does require that you have a brokerage account in order to open the card. In the abstract of my mind that always sounded complicated, but after looking at it better, it’s really simple to open a Schwab brokerage account and checking account which have no fees and no minimums which then enables applying for the Schwab Amex Platinum card. There is a hard pull for creating a relationship with Schwab and then another hard pull when applying for the Amex card.

It’s worth mentioning here a few signup bonuses available when creating a Schwab relationship:

Timing your Amex Platinum Applications

It’s now an excellent to apply for an Amex Platinum card since you can max out the $200 in airline credits in December and immediately thereafter in January, largely offsetting the $550 annual fee right away. December also has a higher $35 Uber credit; the rest of the year you’ll get $15 each month.

There isn’t much time to use the Uber credit, but there’s still time to make use of the airline credit by purchasing a gift card at your selected airline.

  1. Many/most people are getting an instant-issue virtual card number when instantly approved for the Amex Platinum card. I got this and was able to use the virtual card number to buy a $200 Southwest gift card which it triggered the $200 incidental credit.
  2. Amex is known to send new cards very quickly, I typically get my new Amex cards within 48 hours. Even if you don’t get a virtual card number upon approval (e.g. if the application goes to reconsideration), you should still have time to do the airline credit.

The airline incidental purchase might have to fully post to the account by December 31, so try giving yourself a couple of days leeway before end-of-year.

Schwab Signup Process

Here’s a detailing of the sign up process with Schwab:

  • Select Open and Account at this referral link
  • On the next page choose Schwab Bank Checking Account (not brokerage account).
  • Answer whether you want an individual account or joint account; answer if you want to enroll in Trade Services; click Continue
  • The system will then prompt you to open both checking and brokerage. Promo code: REFER will be pre-populated.
  • Click: ‘No, I’m New to Schwab’
  • Enter your personal information
  • Check all the boxes
  • Voila, your account is open
  • You’ll see an Equifax hard pull show up within a day or two (others said it took a week)
  • The debit card and paper checks will come automatically in the mail after about a week
  • Expect a phone call within a day from a Schwab representative trying to help/convince you to transfer money and offer you free trades. (Another phone call might come a couple of weeks later.)
  • Fund your checking and brokerage account by linking your bank account – I transferred $1 to the brokerage account and $1 to the checking account. This should trigger the $100 brokerage bonus. There is no credit card funding option.
  • $100 bonus should post to your brokerage account within 5 weeks. (Sounds like they don’t send a 1099 for this.) Mine came around a month after funding.
  • Keep the brokerage account open for a year so as not to lose the bonus. (You’ll want it open anyway for the Amex points 1.25% cash out.)

You can immediately apply for the Amex Schwab Platinum card. However, there is some degree of Chex sensitivity with Schwab. It’s worth waiting a couple of days – if possible – before assuming you’ll be fine. Others say the opposite: apply for the Amex card immediately. That way, even if Schwab closes out your account, you’ll at least get the card with it’s 60k bonus (though you won’t be able to cash out at 1.25% without a brokerage).

  • Signup here for the Amex Shwab Platinum card with a 60,000 MR points bonus and a $550 annual fee (there are two Schwab credit cards, be sure to select the one you want)
  • If you are instantly approved, you should get a temporary card number which can be used until the physical card comes; mark down the card information, maybe take a screenshot too
  • System should give you an option to immediately add your card in the Amex login
  • During the online login creation, you’ll probably see a special Amex Offer deal (not otherwise available to you) which can be saved at that time only. Typically it’s for 10% off your cell or cable bill. I got the 10% cellular offer during login creation at signup and then the 10% cable offer when I activated the physical card . Again, these offers need to be saved at these special times.
  • Login to Amex and choose your airline for the $200 incidentals credit
  • Buy a gift card at that airline, see what works here
  • I imagine you can use your $35 Uber credit with the virtual credit card as well; just remember to update your Uber account when the physical card comes as the virtual one may stop working (the card number is the same, but the CVV and expiration is different)
  • Cash out your Membership Rewards points at 1.25 cents per point as a deposit into your brokerage account; it can then be easily transferred to the checking account or you can leave it there and invest. You’ll see an option to do this on your home screen in the Amex login.

Final Thoughts

You can literally finish the entire process of signing up with Schwab, getting the Amex Platinum card, and cashing out the airline credit in less than an hour from when you read this post. My point here isn’t to convince people to signup for Schwab, just to say that it’s still possible to do so before year’s end. Evaluate your credit card goals and decide if it’s a good idea for you.

A lot of people consider 1.25 cents Membership Rewards redemption to be mediocre; personally, my preference is to have an easy and steady way of cashing out the points without having to think too much. I cashed out a large stash of accumulated points now, and this will remain my method of choice until the first membership year finishes. I’ll then have to decide whether to keep the account or cancel/downgrade it.

Aside from the Amex card, the checking account and even the brokerage account are things that could be useful to have in the long term.



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Nate
Nate

I opened just a brokerage account (no checking) and there was no hard pull.

William Charles

Some people report the same and then it shows up a few days later

Bala
Bala

Instantly approved for Platinum card however it didn’t give me virtual card number, should i ask amex customer service?

Gahan
Gahan

no you just have to wait for the physical card to arrive, usually platinum cards are rush shipped.

William Charles

They removed this ability recently unfortunately

mcafeeee
mcafeeee

When I opened my Schwab checking account a few years ago it involved a hard credit pull. Is that still the case?

mcafeeee
mcafeeee

nevermind, I see you mentioned an Equifax hard pull in the post.

Too Good 2B!
Too Good 2B!

Yes

Highsky
Highsky

The main reason to sign up now, rather than January, is the $35 Uber credit? I tend to apply for several Amex cards at once.

Too Good 2B!
Too Good 2B!

And you can triple dip the airline credit for one annual fee if obtained in December. Get now, again in 2018, and one more time in beginning of 2019.

Mrdioji
Mrdioji

No, it’s the $200 airline credit

Mastervk
Mastervk

Triple dip on airline credit . Airline credit for 3 years before canceling .

ian
ian

Think I can open a schwab account today, and apply for amex plat and get usable cc number by the 31st?

Max
Max

I’m an existing Schwab customer and tried to apply for the Amex Platinum. After logging into Schwab and clicking the link I’m taken to an Amex page that says the offer is no longer available. 🙁

Max
Max

I used another in incognito mode and the application processed. Instantly approved and the card number was displayed.

JZM
JZM

I also have existing checking and broker account, got “offer not available” error. Tried incognito mode still no luck, anything else you did make application go through?

Max
Max

I used Firefox in incognito for the second time instead of Chrome. That may have made the difference.

Justin
Justin

Man I would love to do this and tried to a few months back, but like many others was declined due to “negative information on Chex.” Ordered my Chex, and although I had a ton of pulls it was clear there was no negative information. 🙁

MSer
MSer

Yep, suddenly Chex has me with a very low score and was declined recently for a new CU app online – had to go in and apply and had no problems. Signed up for a few CUs/banks (4) in past year and it clobbered my Chex score. Wish there was more information about Chex scoring.

Steve F
Steve F

My wife had that happen when she applied for the brokerage and checking. The brokerage was instantly approved while the checking went pending. About a week later (after we received her schwab plat), they mailed us a letter denying the checking account citing negative information which also closed the brokerage account because they were linked.

She gambled by applying for just the brokerage with no checking and it worked. Amex automatically linked to the new brokerage account too!

Mona c
Mona c

Hi doc,
I followed the instructions in opening the schwab checking but all I can see on my account is the brokerage account.

Am I gonna see the checking account when?

Alex
Alex

I did the same thing awhile back. I think I missed a part that added the checking account as well, but honestly I don’t know.

You don’t actually need a checking account, though. The brokerage account is fine and you can still get a debit card for no ATM fees at any ATM, which is honestly great and the main reason I opened it (for international travel where I need local currency).

Don’t worry too much if you only have the brokerage account. That’s the important one so you’re all set!

WGU
WGU

Same here, All I see is the brokerage account after following the instructions.

*Data point: I have opened over 10+ checking accounts this year.

*About 4 hours after opening I signed in just now and under the Brokerage Accounts I see Charles Schwab Bank “We are not able to retrieve your data at this time, please try again later.”

James R
James R

I think you make a great point about the ease of cashing these out to Schwab, and something else to consider is the fact they (can) appreciate. If you’re sitting on 100k MR waiting for the perfect redemption because 1.25cpp is too low, consider that over the past year if you just threw your MR into an S&P index fund, at ~20% return, you’re really getting 1.5cpp. Obviously 20% returns on index funds isn’t something you can depend on year over year, but the fact that you’re able to convert a depreciating asset (credit card points that seem to only devalue over time) into an appreciating one (assuming diversified investing over a long period of time) should have some intrinsic value to it, bumping you over the 1.25cpp cash transfer value.

nycycr
nycycr

Well said! Can’t agree more!

Bryant
Bryant

Also Doc,

Brings the AF to 450 or 350 if you’re like me and already invest with schwab.

Schwab Appreciation Bonus

Receive a $100 Card statement credit if your qualifying Schwab holdings are equal to or greater than $250,000 or receive a $200 Card statement credit if your qualifying Schwab holdings are equal to or greater than $1,000,000, when measured following Card account approval and annually thereafter. For information on qualifying Schwab holdings, please refer to the FAQs.‡

Tom
Tom

+1 for the subtle brag.

Justin
Justin

+2 for the humble brag

marshbelle
marshbelle

I keep circling the AMEX but haven’t pulled the trigger despite receiving targeted offers. I just wouldn’t use the monthly Uber credits and UberEats does not exist where I live. Not having the ability to use the Uber benefit make the AF hard to take.

Kyle
Kyle

Thanks for this well timed post, Doc.

Would you recommend a PRG application (50k incognito, triple dip airline credits) to combine hard pulls with the Schwab plat?

Peter
Peter

Good write up DOC.

Peter
Peter

Edit Chuck

mjs
mjs

Doc,

4 family members have opened accounts this month already (to the point where cards were received, and bonuses already earned on 2).

I would suggest one edit to your post though– DO NOT WAIT A FEW DAYS TO APPLY FOR THE AMEX CARD IF YOU MAY HAVE CHEXSYSTEM SENSITIVITY!

Here’s why: one member got hit with the dreaded Chex closure about 4 days AFTER opening the checking/savings account, and the accounts were closed. However, all you need to get the “keys” to apply for a Schwab Platinum card is the Schwab User ID which gets set-up at checking/savings creation. The member who got the checking/savings accounts closed, applied for the Schwab Platinum the same day (as did the 3 who did not get closed), received the card, and the card still works and presumably will get the 60k bonus ad other benefits.

Because you do have to manually enter the checking/savings account info on the Amex side, when the member attempted to do so, it noted an error occurred and to contact Schwab. The 60k post as general MR points, so worst care if you apply immediately and they close the checking/savings accounts, you get 2 hard pulls and can still use the Platinum for all benefits and redeem 60k for non-Schwab usage.

Also, one other point to above, if you have a substantial MR bonus, then I would also redeem IMMEDIATELY any existing MR points as soon as you get the Schwab Platinum and quickly linking your Schwab account on the Amex website to make sure those pass through in case they close the account for Chexsystem reasons later. Again, the other 3 members of the family (who all have a lot of checking bonuses also via Chexsystem) did this as a precaution and it did not trigger a closure (yet).

So…actually move fast to apply for the Schwab Platinum, and move fast to redeem any MR points to the Schwab checking/savings as soon as you get the card (even before the 60k bonus on the Schwab card itself), just to make sure you beat any closure on the checking/savings accounts that apparently take place many days after the accounts are established and not at time of application.

Kyle
Kyle

What constitutes as a sensitivity on Chex? Will I have problems from the numerous M&T chex inquiries from this past year?

mjs
mjs

no idea, as the member who got “tagged” had a bunch of sign-up bonuses (8?) this year, but another member had essentually the same, and the other two were probably at about 6. Also, all have consistently been about 6-8 checking sign-up bonuses a year.

So ,not really surprised someone fairly sensitive to Chex inquiries would reject, but was surprised only one member got it when they didn’t really stand out from the other 3. Fact that the account was closed about 5 days after openening makes me wonder if Schwab manually looks at these and there may be some inconsistancies.

Matt P
Matt P

My problem is with meeting minimum spending now that they have cracked down so much on MR earning cards. $5000 is a lot since I can’t pay my rent with an Amex but can with visa or mastercard.

mjs
mjs

2 have already seen bonuses post, and there was some significant MS. I’m NOT going to go into detail as to what it was, but I will tell you it wasn’t Simon Malls (since that gets discussed and can’t speak to that).

And for the record, read this post literally as opposed to being cute with a suggestion, since it’s hard to tell sometimes!!

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