Interesting Capiltal One offer

[wincrasher]

Got an email solicitation from Capital One this morning.

1.6% APR on savings balances of $2500 or more. Plus quarterly 10% bonus if you do either: use your capital one card once a month, or your savings balance is $15,000 average balance each month.

Sounds like a good place to park an EF. But being Capital One, there has got to be a gotcha.

[simpletron]

The 10% bonus only applies to the interest, so you're effectively earning 1.76%. also if your balance goes below $2,500, the interest rate is 0%. And as with all saving accounts, the rate can change at any time.

Open an InterestPlus Online Savings Account Today

[Broken Arrow]

The 10% bonus only applies to the interest, so you're effectively earning 1.76%. also if your balance goes below $2,500, the interest rate is 0%. And as with all saving accounts, the rate can change at any time.

Ouch! That's quite a gotcha.

[wincrasher]

Good catch - I wouldn't have noticed that until after the 1st quarter was over. Would have been expecting 4.1%. Can Capital One make money without trickery?

[disneysteve]

Good catch - I wouldn't have noticed that until after the 1st quarter was over. Would have been expecting 4.1%. Can Capital One make money without trickery?

I wouldn't consider that trickery. When you said a 10% bonus, I assumed that meant 10% more than already being earned, not actually 10%. That would fall into the "too good to be true" category.

[wincrasher]

There is ALWAYS something with those guys. The last mailing I got from them had fine print so fine, I couldn't read it even with my new bifocals. I should just cut up my card and send it back to them.

[simpletron]

this bonus still is tricky in a way because it doesn't state the equivalent rate with the bonus anywhere and they probably don't have to either. for example if you were given the choice of that savings account or an identical one that instead of the 10% bonus, it paid 1.9% when meeting the same requirements. I bet plenty of people will think that the 10% bonus is worth more than the extra .3%, even through it isn't, and thus choose the worst account. whereas if they stated the equivalent rate of 1.76%, virtually no one would choose it over the 1.9% one.