Banks want your money. In fact, they are even willing to pay you to get it.
As interest rates rise again, banks want to boost profits by lending more. But in order to make loans, they need cash -- specifically your cash.
From the biggest players in the industry like Chase (JPM) and Bank of America (BAC) , down to online banking start-ups, financial institutions are offering promotions and other sweeteners for customers who sign up for a range of new accounts.
The offers include straight up cash for opening a savings or checking account and market-beating rates on new money market accounts and CDs.
However, not every offer -- in fact maybe even most offers -- are necessarily worth jumping hoops through to get. Before you start moving your money around, you should take a few minutes and do a cost benefit calculation, says Jeffrey Trugman, managing partner of Attitude Financial Advisors in Woodbury, N.Y.
"We are now for the first time in many years in a somewhat rising interest rate environment and the banks are promoting their products," Trugman said.
The question right now isn't which banks are offering various sweeteners to new customers but who isn't.
Citi is offering $500 to new customers who open checking accounts, TD Bank is promising $300 to new members while Chase and TD Bank (TD) are offering $300 bonuses to new customers who sign up for "premier" accounts -- and there are dozens more from where that came.
But before you start making plans to switch accounts, you need to do some research, say Trugman and other financial planners.
First off, you need to understand what you will need to do in order to reap the incentives being offered by various banks, notes Allan Katz, a certified financial planner and president of Comprehensive Wealth Management Group. "
For example, you will probably need to deposit a certain amount of money -- $50,000, in the case of the Citi offer and $2,500 to take advantage of that $300 offer from TD Bank.
You may be asked to maintain a minimum balance over a period of say, two months, or you may be asked to start direct depositing your paycheck or social security payment, as is the case with the $200 offer from Chase.
And you'll need to carefully read all the conditions -- the $300 TD offer is only good if you open an account online, not at your local branch.
Katz said you'll also want to consider whether you are OK with getting called two or three times a week by the bank you sign up with trying to get you to refinance your mortgage or buy another financial product.
"It is worth it for you to make that move? You have to put all that stuff into perspective," Katz says. "What are you getting for what you have to put into it?"
Banks are also pushing their money market funds and CDs, bumping up rates a bit in a bid to reap new customers and new cash.
Barclays, CIT, UFB you name it, are offering interest rates on money market accounts in the 1% to 1.5% range -- not bad considering the average rate was hovering below 1% at the end of 2017.
And rates on CDs are also on the rise, with some banks offering 2% or close to it for customers willing to let their cash sit for at least a year and likely more.
However, in order to make the best bet on a money market fund, dig a bit deeper, urges Ann Benjamin Zuraw, a certified financial planner and president of Zuraw Financial Advisors in Greenboro, N.C.
While 1.4% or 1.5% may look good compared to what's out there, you need to crunch the numbers, looking at the expense ratios, which could even match or negate the yield, and trading fees as well, Zuraw says.
You'll also want to know exactly where the money in the fund is invested, she notes.
If it's a muni money market fund, you'll want to check to see how exposed it is to Illinois and Puerto Rico, where government finances are reeling, Zuraw says.
"Bottom line is a higher yield can also mean higher risk," Zuraw notes. "Promotions need to be evaluated as to how long they will be available. And what costs will there be for going in and out of the fund."
Above all, whether you are looking at switching checking accounts or moving your money into a new money market fund, you'll need to ask yourself whether the gain is worth the hassle and paperwork involved.
If your account is paying a quarter of a point and another bank is offering, say 2%, for a one year CD, it may be enough to make a difference. Small gains, such as quarter point, may not make sense, but neither is it worth just automatically shrugging off, either, Trugman notes.
"It is about making lots of little decisions that cumulatively have an impact," Trugman says of his approach to financial planning. "It's not any one big decision -- it's a lot of little ones. There are always pros and cons to it."