The Magic of Referral Bonuses

Referral programs: the perfect way to incentivize people to get their financial shit in order. I’ve written in the past on how I’ve made a hefty amount of money from Chase Sapphire Preferred referrals. Since writing that post, I’ve referred yet another co-worker to the card, increasing my total referral bonus earn on the card to $350. 

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The best referral programs are the ones that incentivize both parties. Sure, you may get some extra cash for each person you sign up for Bluehost, Share-A-Sale. or Awin, but if the person referred doesn’t get a little extra as well, what’s the likelihood they’re going to click?

Programs that reward everyone are win-win. It’s a huge part of why I’ve kept my Chase Sapphire Preferred card for so long, despite no longer having large travel-related expenditures. The card feels nice, I use it as my primary card, and the $100 referral bonus essentially covers my annual fee. Although referring someone to a Chase card doesn’t give them an additional bonus, I count it as a win-win because referred friends still get the full sign-up offer for the card that they’re referred to. That’s often not the case with American Express, who has highly tailored sign-up offers (more on that in a moment). It’s definitely not the case for every referral program out there.

Checking and Savings Referral Bonus

Capital One 360 gives you $20 for each person you refer. Anyone referred gets a $25 account opening bonus. Don’t have a 360 account, but interested in opening one? Here’s my referral link. I love my 360 savings accounts because of how much I can customize them. I’m well aware that the benefits of a Capital One 360 account aren’t significantly greater than other checking/savings accounts; that’s probably why I haven’t received any referral bonuses through this program.

Most banks have referral programs for checking/savings accounts. For example, TD Bank gives both the referee and the referrer $25. However, banks have very good incentives for new customers, often offering between $100-$300 to open a new account. Because of that, it’s no surprise that banking referrals offer such a small incentive.

Credit Card Referral Bonus

Chase has the most established credit card referral program. Have a Chase card? You can see what referrals you’re eligible for by checking out their dedicated referral site. The same goes for American Express, although their referral offers are less frequent. I wish I knew what bonuses AmEx offers. Chase now offers $100 bonuses for Freedom and Sapphire Preferred referrals. (It used to only be $50.)

Discover has an interesting referral program. While the bonus is only $50, whoever you refer is also eligible for a $50 bonus, so long as they use the card within the first 3 months. Even if Discover’s offer isn’t as rich as Chase’s, I have to imagine it’s far easier to get someone interested in signing up for a card if there’s an extra $50 in it for them.

Investment Referral Bonus

At the beginning of the year, I finally started investing outside of my retirement fund. After looking at and trying a couple different platforms (Robinhood, Betterment, Acorns, etc.), I went with Wealthfront, due to the appeal of robo-investing and lower fees. Wealthfront’s standard sign-up offer is that your first $10K managed free. I was referred by my boyfriend, giving us both an extra $5K in managed funds.

Wealthfront’s Referral Program

8 months and 2 referrals later, I now get $25K in no-fee managed funds.

Help your friends start investing, and help yourself, too

Although my Wealthfront account balance is well below $25K, it’s incredibly motivating to see that I’m getting a benefit out of helping others take big financial steps. It’s good for Wealthfront, too (obviously).

Betterment, another robo-advisor similar to Wealthfront, offers 30 days of no fees for every friend referred. Referred friends get 3 months free. The cherry on top? For every 3 friends referred, you get a whole year free. Use Betterment? I hope you’re taking advantage of this! Extra cash can be found almost anywhere. Robinhood will give you free stocks, and Acorns gives you $5 or $10 in cash. Seriously, most brokerages offer referral bonuses. This compiled list by Money’s My Life shows just how much free money is out there, waiting.

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If you’re already a customer at any of these institutions, take a minute to look at referral program requirements. You never know when you’ll come across someone looking for a recommendation. And, if you’re on the other side, and you know you’re going to open a new account somewhere, ask around first and help a friend out. Chances are, someone can give you a referral, and you’ll both get a little extra for your trouble.

Did I miss any big referral programs? What types of referrals have you found to be the most successful?