Fund Roth IRA With Bank Bonuses
I am back at it! After taking last year off from coming up with a weird goal for the year (I lived off gift cards for a month in 2023) it is time to come up with something new. I had been considering a few different options but landed on a bank bonus goal. Not just a goal to beat my best bank bonus year ever, but a goal to fund my Roth IRA with bank bonuses. I just checked Roth IRA cap and it is $7,000 a year for people under 50 years old. Crap, I had planned on the old $6K cap – I guess that means more work for me. If you are over 50+ you can contribute up to $8,000 this year. There are also income eligibility caps etc. with Roth IRAs, but I don't want to go into that too much. You can use whatever vehicle you like if you try to do something similar, even if it is just a high interest savings account. Either way, I hope you follow along on my journey.
*I should note that I am not accounting for the taxes we will have to pay for these bonuses just to keep it all simple.
My Goal For 2025
I know that this is more miles and points adjacent, but I think bank bonuses are an untapped resource that many overlook. Especially if you are currently in a cool down mode for credit card applications etc. I have always mixed in bank bonuses with my normal miles and points earning because there are times when points just won't do. Airline award taxes and fees, cheap cash hotel stays and everything you need to pay for when you have boots on the ground takes money. If we are in the business of traveling for “free” then we need to offset as much of that up as possible. Sometimes that does come in the way of points, thanks to my Capital One Venture X Business, but more often then not it is cold hard cash.
This year, and probably years into the future if this goes well, I want to focus on more than just making some side cash. I want to put my skills to use towards a higher power. Our retirement! What if we can shave 3, 4 or 5 years off our working life just from bank bonuses? That would be pretty amazing. For that reason I am going to try to get as close to that $7,000 cap as I possibly can during 2025. The downside is that bank bonuses can take FOR-EV-ER to post, so this won't be easy to maneuver. The upside is that a lot of this can be done from the comfort of my couch.
Why Choose A Roth IRA?
I also like focusing on the Roth IRA since it works kind of like a savings account. Should something unforeseen happen then I can tap the funds that I deposited without paying any early withdraw fees. That is because the money deposited is after tax money. That is where a Roth IRA differs from a traditional IRA. The tax perks with the Roth IRA come at the end of the rainbow instead of upfront like the traditional IRA. With a Roth IRA I just can't touch anything that the deposits earn in the market without paying a penalty.
If you are interested in learning more on this stuff then I encourage you to seek out your investment professional, of which I am not. Covered my butt right there!
How I Will Update You Each Month
My plan is to share with you what I earn each month in term of bank bonuses, but also share what the investments earn themselves. I'll also give you a peak at what I am working on / what is in the hopper in terms of bonuses. This may start out a bit slow, since so many things take months to post, but I will try to get a lot of things up and running early on.
I think this transparency, of what I make – or lose – along the way will make it more interesting and beneficial. It will give you some real world feedback on how these accounts grow over time. Hopefully I can keep this thing humming over several years. That would allow you to follow along from when it was just a few hundred dollars to when it is hopefully up in the tens of thousands of dollars. I should say that my wife is fair game too. It will be bonuses from the both of us that go into this one account. I decided to go with SoFi for my account since I already had a Roth IRA set up with them. There was a few hundred dollars in there already from last year, but I'll notate that in my monthly report.
I'll give you the update towards the end of each month throughout 2025.
January 2025 Bank Bonus Results
Here are my results of funding my Roth IRA with bank bonuses for the month:
- Balance Forward From Last Month: 692.14 (This is from money added last year, and will be our starting amount)
- Bank Bonuses Added: $0
- Profit / Loss: $82.39
- Ending Total: $774.53
- Net Difference: N/A
Unfortunately my Chase checking bonus posted more quickly than expected and landed in late December instead of early January. That is also where the beginning balance mostly came from. Because of that I don't have anything new to add for this month in terms of bonuses. There are some things brewing in the hopper though.
New Bonuses I Am Working On
Even though the Chase checking bonus portion of the offer posted late last year, we still have two payable bonuses out there with them. That would be for the savings portion of the offer, plus the combo bonus you get for doing the checking & savings account. It looks like this one should pay out sometime in March. That will be a payout of $600 per person, or $1200 in total.
I also received a targeted mailer from Flagstar bank for a business checking account bonus. This one requires me locking up $25,000 for a while to get it. Because of that I am waiting until later in February to do it right before the offers expires. That way I can rob Peter to pay Paul a bit, since we already have so much money tied up for the Chase savings bonus. Hopefully the Chase bonus will pay out a few weeks later and I can take advantage of my credit card float period in the meantime. Stay tuned on how that all plays out.
Fund Roth IRA With Bank Bonuses: ToP Thoughts
I hope you enjoy this challenge and follow along as I try to fund my Roth IRA with bank bonuses. I am not sure if I will make it all the way to $7,000 this year, since my best ever was just over $5,000, but it will be fun to try. More than that though, I am looking forward to using these skills we have to help improve our financial freedom. Miles and points are great, but nothing is better than being financially secure. As you develop your miles and points skills they can be used to do all kinds of things just like this. It can go so much further than just international business class and fancy hotels.
Let me know what you think of my zany goal for 2025 over in the ToP Facebook Group.
