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If you get fancy you can almost make RH Gold pay for itself. If you have at least $2k in your brokerage account you can enable margin, and with Gold RH will give you the first $1k of margin at zero interest. That $1k invested in something like SGOV with 5.2% yield will almost but not quite pay the RH fee.
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Mar 27, 2024 03:11
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IRA 3% matching is pretty nice. I think the card will stop offering cash back in like 18-36 months and then it’ll be only gift cards and travel. They may be betting it’s enough to get people to move their money into robinhood completely.
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Mar 27, 2024 09:18
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I believe that ad copy also says they are giving a 1% match on all money put into their brokerage account as well, which is pretty nice imo. E: 1% match/bonus on deposits with robinhood gold. The 1% is paid out evenly over 24 months. Canceling gold will forfeit the unpaid amounts but you keep what you already got. quote:beginning in early May, Gold members will receive a 1% unlimited deposit boost on all incoming brokerage deposits, with no cap6. Boris Galerkin fucked around with this message at 10:46 on Mar 27, 2024 |
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Mar 27, 2024 10:35
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Atahualpa posted:Worth mentioning that the USBank, Bank of America, and USAA all have stupid restrictions on redeeming your cashback, and Bank of America doesn't seem to have any way to set up autopay unless you bank with them. Much happier with Citi and Chase for their cashback options, although Chase recently switched to requiring you to manually enter the routing/account number each time if redeeming cashback to a bank account, which is a bit annoying. If that last sentence is happening to you, your external bank information is probably in some kind of purgatory. I fixed it by removing and re-adding my payment account.
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Mar 27, 2024 10:50
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Vlad is on Squak Box right now talking about the card. Not sure the easiest way to watch past segments, but there will surely be plenty of "finfluencers"  covering it on YouTube later.
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Mar 27, 2024 12:43
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drk posted:Technically a monthly fee is not an annual fee My annual compliance training at work would be very unhappy with that “technically.” Implying stuff is free when it’s not is like the biggest sin of false advertising.
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Mar 27, 2024 12:58
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drk posted:Technically a monthly fee is not an annual fee I just noticed this quote and an online calculator says 36g of 10 karat gold is about $1000 worth of gold. Are they really giving people a credit card that literally worth $1000? lol. For needing 10 people to sign up and stayed signed up this is obviously targeted for fintok bros cause I can't imagine how a normal person has 10 people they can refer. Also if I sat on a 10karat pure gold card will I break it? I thought gold was very malleable. Note: I know nothing about gold and jewelry. I just see Olympic winners biting their gold medals etc.
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Mar 28, 2024 14:09
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Boris Galerkin posted:I just noticed this quote and an online calculator says 36g of 10 karat gold is about $1000 worth of gold. Are they really giving people a credit card that literally worth $1000? lol. For needing 10 people to sign up and stayed signed up this is obviously targeted for fintok bros cause I can't imagine how a normal person has 10 people they can refer. I imagine its 0.1g of plating on top of some cheaper metal.
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Mar 28, 2024 14:16
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Xenoborg posted:I imagine its 0.1g of plating on top of some cheaper metal. I assumed the same too but the quote from drk's post says quote:if you refer 10 friends who sign up to Robinhood Gold, you’ll earn the solid gold Robinhood Gold Card – weighing 36g and made from real 10 karat gold I mean, ok technically this statement could mean it's a "solid card weighing 36g and made with 10 karat gold", instead of "36g of 10 karat gold".
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Mar 28, 2024 14:33
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Boris Galerkin posted:I assumed the same too but the quote from drk's post says If you refer 10 people who each have to pay $5/month, $60/year for RH Gold they're 60% of the way to breakeven before even getting to the interchange income they'll earn off of 11 people using the thing. So the earn back is probably only a few months for them honestly.
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Mar 28, 2024 14:50
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It really is 36g of gold. They say that if you qualify and they're unable to send you one, they'll give you a "cash equivalent" they value at $1100, which is right in line with the value of 36g of gold.
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Mar 28, 2024 14:53
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Its not entirely unusual for credit cards to hand out ~$100 referral bonuses, so $1100 for ten isnt that weird. But still, who wants to carry around a thousand dollars of gold in their wallet. Even if you manage to never lose it or have it stolen, what are you supposed to do with it when it expires? Melt it down?
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Mar 28, 2024 15:10
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I would not want to carry around it around. Gold is a very soft and malleable metal.
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Mar 28, 2024 15:16
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https://www.youtube.com/watch?v=pONcOSlyW48
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Mar 28, 2024 15:23
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I'm seriously considering throwing my direct deposit into RH when they roll that 1% deposit bonus out in May. Even if it's prorated over 24 months, my quick spreadsheet math says that I'd come out on top and all I'd have to do is change a routing number on ADP?
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Mar 28, 2024 15:33
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Boris Galerkin posted:I'm seriously considering throwing my direct deposit into RH when they roll that 1% deposit bonus out in May. Even if it's prorated over 24 months, my quick spreadsheet math says that I'd come out on top and all I'd have to do is change a routing number on ADP? Its basically a $150 ($210-$60) account opening bonus if you max your IRA with them this year? And its paid out over 2 years? Doesnt seem that compelling. If you're willing to open new accounts and move a direct deposit around, you could make a lot more churning bank account sign up bonuses.
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Mar 28, 2024 15:57
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drk posted:Its basically a $150 ($210-$60) account opening bonus if you max your IRA with them this year? And its paid out over 2 years? No, the link to the marketing material is talking about a new 1% uncapped match on all deposits. I don't think this is related to the 1-3% IRA match. I'd have to wait for the fine print to be published, but if it's as simple as switching my direct deposit to RH to effectively get 1% more take-home pay and I don't need to keep my money sitting in RH then I don't really see the downsides.
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Mar 28, 2024 15:59
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gregday posted:I would not want to carry around it around. Gold is a very soft and malleable metal. At 10 karat though, it’ll be more durable than most gold we encounter in the west. But still - it’s gonna be heavy and it’s gonna be dumb.
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Mar 28, 2024 16:39
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rufius posted:At 10 karat though, it’ll be more durable than most gold we encounter in the west. The actual gold card seems extremely dumb. The IRA deposit bonus and direct deposit bonus are intriguing, but I'm also guessing they will be larded with caveats.
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Mar 28, 2024 16:49
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My expectation on the 1% direct deposit match is you will need to keep money inside of the account for something like 6 months. So you can split your direct deposit and contribute $100 a month to your RH brokerage to invest and end up with $101 to invest, but you probably won't be able to deposit your whole paycheck and use it to pay your bills/rent/expenses and treat it like a 1% raise. The 3% IRA match isn't new, and as far as I know is legit without any obvious catches.
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Mar 28, 2024 17:28
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Between the 1% deposit bonus, 3% Roth IRA bonus, and 3% credit card, I'm pretty tempted to shift some money over to Robinhood, EXCEPT I have to imagine RH is betting on much bigger fish than me converting to their ecosystem and being too inconvenienced to leave if/when RH jacks up their fees and/or reduces benefits. Someone find the crystal ball that says whether chasing these margins would be worthwhile... going to give this some time and see how the first mice fare. Edit: thanks, long term investing thread! Space Fish fucked around with this message at 15:56 on Mar 29, 2024 |
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Mar 29, 2024 05:14
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Seems like a good way to have your money not be FDIC insured. I wouldn't trust robin hood in anyway to actually do this program bank model they're saying.
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Mar 29, 2024 16:49
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Veskit posted:Seems like a good way to have your money not be FDIC insured. I wouldn't trust robin hood in anyway to actually do this program bank model they're saying. I mean the money I deposit into my Fidelity account from my paychecks also isn't FDIC insured and I don't particularly care or am worried about that.
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Mar 29, 2024 16:53
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Boris Galerkin posted:I mean the money I deposit into my Fidelity account from my paychecks also isn't FDIC insured and I don't particularly care or am worried about that. Yeah the balance sheets between those two are close enough to mean it’s the same thing. Im just throwing out there the risk. I think it’s a risk worth mentioning.
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Mar 29, 2024 17:15
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There's something about Robinhood in particular that really triggers the fear and disgust center of the brain far out of proportion to comparable companies. Kind of fascinating how you'll find this response pretty much everywhere online and cutting across groups who otherwise agree on little.
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Mar 29, 2024 17:51
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Robinhood's 2018 "Checking and Savings" account disaster is probably still fresh in a lot of people's minds. Or maybe the 2020-2022 issue where tens of thousands of people's accounts were illegitimately accessed thanks to lapses in their security. Or maybe the 2021 data breach that leaked the details of a bit over 7 million customers.
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Mar 29, 2024 18:29
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or the time they had to pay the largest ever FINRA penalty at $70 million for misleading customers and trading outages, or the time their broken website let people basically trade on infinite leverage, or the time the college kid committed suicide because their broken website displayed an account balance in the negative six figures. There's really never been a time where Robinhood didn't have at least a little fly-by-night startup stink to them, and I don't think offering a bunch of benefits that make most reasonable investors go "where's the catch" is going to change that perception
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Mar 29, 2024 18:35
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Robinhood is not profitable but every other retail brokerage is.  “Move fast and break things” might be fine if you’re making a silly little website to share photos with your friends. It’s a terrible philosophy when you’re dealing with people’s financial livelihoods. That said I’m really tempted by their IRA match. 
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Mar 30, 2024 14:52
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I know I've been sounding like I'm advocating for Robinhood and I'm really not. I keep saying that it all depends on the fine print etc etc. Well, here's a recent article published by the NYT on 3/28 about this new card offering (emphasis mine): https://www.nytimes.com/2024/03/28/your-money/robinhood-rewards-credit-card.html quote:Here’s the first thing to know about the new Robinhood credit card that promises 3 percent cash back on all purchases, without limits: Yesterday, when I asked Vlad Tenev, the company’s chief executive, to guarantee that it would stay at that level for 18 months, he would not. I'm guessing "gaming" in this context means people who it thinks are trying to game the system, not gaming as in gambling. So TLDR Robinhood reserves the right to terminate the 3% cash back program at any time, they reserve the right to cancel your card for vague unspecified reasons, and would not commit to offering the cash back for more than 18 months. The part I bolded is IMO, as someone who is not involve in finance or knows jack poo poo about the finance industry, is where they hope to make all of their money: from charging 29.99% interest to people who carry balances, and I suspect there will be a lot of people who do that. At the same time, Goldman Sachs is divesting its Apple Card partnership because it is somehow losing money with Apple wanting more people approved. If GS can't make a profit with charging interest fees with Apple's insistence that higher risk applicants are approved then how will Robinhood do this?
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Mar 30, 2024 15:38
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All of that is going to apply to any credit card with a particularly valuable rewards program. They can change the terms, reduce the value of points, or convert the card to another product altogether pretty much whenever they want. I, with no evidence whatsoever, think the most likely scenario is they use the 3% card to get as many Robin Hood Gold subscribers as they can, and after a little while increase the price and hope enough customers are too locked into using their various offerings to deal with the hassle of switching. "Gaming" the system probably mostly refers to artificial spend, like the people who bought hundreds of thousands of dollar coins from the mint at 1:1 pricing, deposited those coins right into a bank, and got to keep the points and other rewards.
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Mar 30, 2024 17:03
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THF13 posted:"Gaming" the system probably mostly refers to artificial spend, like the people who bought hundreds of thousands of dollar coins from the mint at 1:1 pricing, deposited those coins right into a bank, and got to keep the points and other rewards. This is absolutely going to be a magnet for round trip fraud. Any moron can get a credit card processing account that charges less than 3%. I have seen these accounts used before to to fraudulently "build credit", but now round tripping money through these is actually directly profitable. Yeah, they will get shut down and this is almost certainly illegal. But, I wouldnt at all be surprised if it becomes a problem for Robinhood.
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Mar 30, 2024 17:24
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Boris Galerkin posted:I keep saying that it all depends on the fine print etc etc. It literally doesn’t matter what’s in the fine print. That’s the point I’m making. This seems like an extremely risky proposition.
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Mar 30, 2024 18:06
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I’m going to get a Discover It secured card and start building my credit. I know I need to pay the entire balance every month. Does it matter if I just put my electric bill on it or should I fully utilize it? Does your starting limit matter? I was thinking of a $600 line of credit so it’s impossible to overspend but I could go up to $1,000 if it would help build my credit better.
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Apr 1, 2024 17:08
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Arrgytehpirate posted:I’m going to get a Discover It secured card and start building my credit. I know I need to pay the entire balance every month. Does it matter if I just put my electric bill on it or should I fully utilize it? Does your starting limit matter? I was thinking of a $600 line of credit so it’s impossible to overspend but I could go up to $1,000 if it would help build my credit better. The amount you put on the card is less important than establishing a history of on time payments.
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Apr 1, 2024 17:30
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Credit utilization (the ratio of your available credit to your used credit) has some bearing in determining your credit score, but I'm not sure to what degree, and I don't know how much it will matter if you're paying the card off monthly. In general having a higher credit limit on one card helps your credit utilization across multiple loans and cards, so personally I just request a credit limit raise every once in a while on cards that I use a lot, but I have no idea if $400 would make a big difference or not. I also have no idea if secured credit factors into credit ratings differently than unsecured credit, someone smarter than me in here will probably know
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Apr 1, 2024 17:48
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A secured card counts towards your credit the same as a regular unsecured card. Having a lower utilization (using less) is better for your credit, but this aspect of your credit score is just current utilization, it doesn't have a "history". (Having high utilization in January wouldn't negatively affect you in April if you didn't have high utilization on your most current credit card statement). You don't benefit at all from spending more money each month. The starting limit would let you have a lower utilization, but since a secured card is going to require a deposit I wouldn't bother with it.
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Apr 1, 2024 18:33
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If the goal is simply build credit usage history and you aren't getting any rewards or anything else, I'd pick a bill, set it to autopay on the CC, and then set the CC to autopay itself from a checking or savings account. Stick the card in the back of a drawer where you'll never use it again.
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Apr 1, 2024 20:17
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Arrgytehpirate posted:I know I need to pay the entire balance every month. You need to pay the statement balance to avoid interest. You don't need to pay off anything you've added to the card past the statement closing date until the next cycle. This buys you time to budget for those living paycheck to paycheck or moving money between accounts (cash, savings, brokerage), and in the rare event you need it, gives you a longer window to dispute charges. Girbot fucked around with this message at 21:01 on Apr 1, 2024 |
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Apr 1, 2024 20:59
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Girbot posted:You need to pay the statement balance to avoid interest. You don't need to pay off anything you've added to the card past the statement closing date until the next cycle. This is true and generally good advice, but with a credit limit potentially as low as $600, its not crazy to just pay the whole balance every month anyways. Its probably only a small difference in payment, but even $50 is a huge percentage of the available credit in this case.
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Apr 1, 2024 21:03
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If I'm not reading it wrong, discover it secured is a 1% cash back card (with 2% on gas) with an automatic upgrade after 6 months. Depositing as much as you can and using the card normally might not be a bad idea. Assuming you use it properly without charging for stuff you don't have money for.
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Apr 1, 2024 21:28
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