Banks have upped their signup bonus game to attract better customers, but thisfrom Florida's C1 Bank takes the cake.
The bank is giving away one of four Mercedes Benz roadsters to new customers flush enough to open a $1 million five-year CD.
Here's how the math works out:
You deposit $1 million and C1 applies a 1.20% interest rate (about $12,000 per year). Over five years, that adds up to $60,000. The value of the Benz -- including tax, delivery fee, and registration -- comes to just about that figure, at $61,294.04.
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Why This Should Worry You
Consumers already have enough trouble making long-term financial choices -- and that's without a brand new shiny Benz dangling in front of them.
And Financial Brand -- a B2B site for financial marketers -- is even encouraging more banks to follow C1's footsteps: "Save it for when your bank or credit union needs deposits, because that day will come again ... This could be a particularly deadly approach to take with the next generation of CD investors -- Gen-Y, also known as Gen Now."
What's more, chances are high you'll find a far more competitive interest rate elsewhere. We found three credit unions advertising 2% rates on five-year CDs using Nerdwallet's deposit rate tool. On a $1 million deposit, that's a difference of $8,000.
The Fine Print
- The offer ends May 31, 2012 and only applies to Florida residents.
- You can only drive off with two cars per household
- You can choose from the 2012 SLK350 Roadster, 2012 E350 Sedan, 2012 ML350 SUV, and 2012 E350 Convertible.
- New consumer deposits only
- Withdraw early and they'll deduct the value of the car from your $1 million deposit