Earning Big Miles for Checking and Investment Accounts

Earn miles for investment account funding and for your checking account.

While BankDirect reduced mileage-earning for checking accounts that hold over $50,000, I’ve been a BankDirect checking account customer since July 2003, and I use it as a checking account.

It is not an investment account that pays a rate of return in miles rather than money (and which doesn’t report earnings to the IRS). Well, in a world of low interest rates it is that. But it isn’t primarily that.

BankDirect awards 100 American Airlines miles per every $1000 average balance every month. Depositing $50,000 at the bank generates 60,000 miles per year. If you value those miles at 1.5 cents apiece that’s a $900 return. If your rate of return on that cash would otherwise be somewhere less than 2.5% you’re probably coming out ahead (depending on your marginal tax rate of course).

With declining profits to banks for holding checking account cash, they instituted a $12 per month fee — that you can not get out of with minimum account balances or with payroll direct deposit. And so I no longer think the account makes sense for people that don’t carry ~ $5000+ average balances.

Miles for Checking Accounts

Other checking account products earn miles for signup, but I don’t know any others that reward you on an ongoing basis for the balances you keep in your account. Two banks that offer mileage signup bonuses for checking accounts are:

  • UFB Direct offers 1000 American Airlies miles for direct deposit and they offer an American Airlines mileage-earning debit card that gives 1 mile per $2 in spending, not to exceed 120,000 miles per year.

  • Citibank often offers American Airlines bonuses for new checking accounts – these offers usually include a requirement of spending on their debit card and also direct deposits. I wouldn’t take their 30,000 mile offers, though, given the possibility of 1099 forms reporting the miles awarded on their banking products to the IRS. If you’re paying taxes on those miles you’re not really coming out ahead, as the reported values tend to be rather inflated.

Miles for Investing

Years ago I opened a TD Ameritrade account and earned Starwood points for my initial deposit, though it appears TD Ameritrade no longer has any mileage offers that I can find.

The big mileage earning comes from Fidelity.

Fidelity offers up to 50,000 miles from your choice of American, United, or Delta with a deposit of $100,000. You used to be able to ‘cycle’ the same money in and out to get up to that $100,000 mile threshold, but it no longer seems to be possible.

(Hat tip that the Delta offer was extended to December 31, which prompted this post, to Free Frequent Flyer Miles)

With each of these offers, Fidelity will give you up to 50,000 miles based on the amount you deposit into your account within 90 days of opening.

  • 15,000 miles for a $25,000 deposit
  • 25,000 miles for a $50,000 deposit
  • 50,000 miles for a $100,000 deposit

And while Fidelity doesn’t give you an ongoing bonus for your balance the way that BankDirect does, you can earn one bonus per 12 month period. So get the 50,000 American miles if you can park that much cash or move in that big an investment, wait 12 months, and get a bonus through another airline offer. And these three mileage-earning bonus offers have not, to date, been 1099’d.

About Gary Leff

Gary Leff is one of the foremost experts in the field of miles, points, and frequent business travel - a topic he has covered since 2002. Co-founder of frequent flyer community InsideFlyer.com, emcee of the Freddie Awards, and named one of the "World's Top Travel Experts" by Conde' Nast Traveler (2010-Present) Gary has been a guest on most major news media, profiled in several top print publications, and published broadly on the topic of consumer loyalty. More About Gary »

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  1. Gary,

    Thank you. A couple of months ago you breifly discussed a BOA card which essentially offered cash back, but there was a nuance such that also having a well funded brokerage account would rather much goose the awards – can you advise which that was?

  2. With Fidelity, is there a waiting period/clawback? I.E., if I open and fund, wait 90days for the miles to post, then move funds out, am I OK?

  3. Fidelity does not allow you to fund a retirement account to earn miles, which doesn’t do me much good… But the Citi Gold Checking Account is great, easiest 60K AA points next to their CC’s.

  4. If you have a bankdirect account, don’t deposit money orders. They shut me down for a very modest level of money order and paypal deposits.

  5. I have the same question as Levi. How long do you have to park the money in Fidelity account in order to earn and keep the miles bonus?

  6. I opened up a fidelity account many years ago, and in 11/13 deposited money in to “Fund an existing account,” earning UA miles

    I pulled the money out ~3 months after the required 6-month period (now 9, I believe).

    Now, when I go to “Fund an existing account,” I get:

    “Unable to sign up for the United MileagePlus® Offer
    You are not eligible to sign up for this Offer due to the reason(s) listed below:
    We apologize, but this offer is not available to all Fidelity customers.”

    So, don’t bet on doing this annually!

  7. Gary, Are you sure that Bank Direct waives the monthly fee with the minimum balance? They don’t on my account and I can’t find that on their website. Still worth it for me to pay $144 for 60,000 miles, but I’d rather not if I don’t have to.

  8. The fidelity miles bonus only makes sense if you invest the funds that were deposited with Fidelity, otherwise you need to lease the deposit in Fidelity for at least 9 months giving a yield on a $100,000 deposit of slightly more than 1.3% – only about $300 more than you can get in a money market account with total flexibility.

  9. I just added the 100k to my existing Fidelity brokerage acct. @Joel, of course it would be invested–who would keep 100k+ in a MM acct? At current interest rates, you wouldn’t even keep up with inflation. But, mine is in an ETrade acct., and I just moved some investments over to Fidelity. For those who asked, it is 9 mos. before you can remove it, and I think if you remove the $ you have to wait an additional 12 mos. before you can “reinvest” the same $ and get a new bonus. I know it is no sooner, but, it could be a “never” situation. At any rate, you can really only do this once every two years. Worth it to me though.

  10. With Fidelity you need to leave the funds for 9 months – but you get the miles credited to your airline account within 60 days of opening the account.

    An easy way to get double miles is to have your spouse open her own account with her own SS number. If you open joint accounts you can only have one of the accounts.

    I had to wait a year to open a second mileage account in my own name.

    If you move the money out of account before the 9 months they will probably block you from opening another mileage account.

    If you want to be totally protected you can use the deposited funds to purchase a bank CD that matures in 9 months paying about .5 % which gives a total yield (at $.02 value per mile) of 3.1% with 2.6% of it tax free. Not a bad yield in today’s market.

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