@Torrin
I have personal reasons; I cycle through about $150k of checking account cash monthly for expenses.
Wesley said:
@Montana
What are the minimum accounts I need to open? I wouldn’t mind holding $100k in a checking account since I typically keep $250k as a rainy day fund with Chase.
If you’re keeping that much in a checking account, you’re missing out on earned interest. Right now, you can get over 4% annual interest, which would be $10k if your balance is $250k. Even if you choose to stick with Chase, consider opening a linked self-directed investment account and investing in low-risk options like VUSXX or SGOV.
@Kip
It’s not a big concern for me; I need to have the extra balance available in case I exceed my budget due to my varied spending.
Wesley said:
@Kip
It’s not a big concern for me; I need to have the extra balance available in case I exceed my budget due to my varied spending.
That’s why it’s strange to use credit cards for a 1% margin on taxes while neglecting a $10k loss from keeping it in a checking account instead of a HYSA.
Wesley said:
@Montana
What are the minimum accounts I need to open? I wouldn’t mind holding $100k in a checking account since I typically keep $250k as a rainy day fund with Chase.
At the bare minimum, you’ll need to open a savings account. The Smartly Rewards are tied to the checking account, and they scale based on the total of all your accounts. Most people put their money into a brokerage account. Be aware that US Bank’s brokerage has outdated processes that require phone, fax, or mail interactions for many services. If you’re interested in their brokerage, there’s a Bogleheads thread that might provide insights.
If you meet the minimum balance across the necessary accounts, many fees can be waived. The bank may charge you upfront for fees, but they will reimburse immediately. Although they have a dormant account fee, those who maintain activity mostly avoid it.
If you’re already using US Bank, it can be a fantastic card, but transitioning into their ecosystem can be cumbersome due to the multiple accounts that need to be managed.
@Montana
Thanks for the insights! So I would just need to open the checking and savings accounts, and keep a minimum of $100k between both to qualify for 4%?
Wesley said:
@Montana
Thanks for the insights! So I would just need to open the checking and savings accounts, and keep a minimum of $100k between both to qualify for 4%?
Actually, you only need their savings account. With $100k in the brokerage, you’ll qualify for 4%.
Source: I’m currently doing this.
@Tal
Got it, thanks! I’ll open the account tomorrow.
I’m planning to use two Chase Freedom cards through PayPal before 12/31, allowing 5% cash back on up to $1,500.
Rants said:
I’m planning to use two Chase Freedom cards through PayPal before 12/31, allowing 5% cash back on up to $1,500.
Unfortunately, $3000 wouldn’t really impact a $90k tax payment.
Isn’t there a 3.75% charge from the IRS for credit card payments?
Obed said:
Isn’t there a 3.75% charge from the IRS for credit card payments?
@Paden
This method has worked well for me. The website may seem slightly sketchy, but I had no issues with my 2023 taxes and plan to use it again this year.
Baylen said:
@Paden
This method has worked well for me. The website may seem slightly sketchy, but I had no issues with my 2023 taxes and plan to use it again this year.
Right? I was a bit surprised when I was first referred to it a few years ago.
Obed said:
Isn’t there a 3.75% charge from the IRS for credit card payments?
I noticed the fees are either 1.87% or 1.82%, depending on the provider.