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Ken Tumin founded the Bank Deals Blog in 2005 and has been passionately covering the best deposit deals ever since. He is frequently referenced by The New York Times, The Wall Street Journal, and other publications as a top expert, but he is first and foremost a fellow deal seeker and member of the wonderful community of savers that frequents DepositAccounts.

Featured 2-Year CD Rates

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DETAILSINSTITUTIONAPYMINMAXPRODUCT
GiftsforBanking.com0.15%$25k-3 Year CD Gifts
GiftsforBanking.com0.10%$25k-2 Year CD Gifts
Accounts mentioned in this post. Rates as of August 23, 2014

Review of GiftsforBanking.com CD Special - iPad Valentine Bundle

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GiftsforBanking.com

GiftsforBanking.com is offering another special gift package for opening a CD. The CD rates are much lower than what they were offering last November. These rates and package details are currently listed at GiftsforBanking.com front page. It's scheduled to end on 11:59 PM EST on 2/14/2011.

  • 2 year CD with a 1.00% APY ($50K minimum)
  • 3 year CD with a 1.25% APY ($25K minimum)

You can get at least 0.75% more on similar CD terms at other banks. So how much will the lower interest rate cost you over the 2 or 3 years?

  • $750 for the 2-year CD
  • $563 for the 3-year CD

Here's what they list for the iPad Valentine Camera Bundle:

  • 32GB Apple® iPad
  • Nikon Coolpix® L22 Camera (red)
  • ful Brooklyn 2-in-1 iPad Backpack
  • $75 Apple Gift Card
  • $25 iTunes® Gift Card

I called the bank and asked about the value that would be reported on the 1099. I was told it's $1,100 which seems high to me. If you are told of a different value, please leave a comment. Also note, there are other gifts to choose from. This is just their special package.

I was also told that the CD rate locks at the date of the application, and you have 14 days to fund the CD. Several readers have reported a slow CD opening process and poor customer service. I have more details in my previous GiftsforBanking.com CD review. Several readers shared their experiences with opening these CDs in the comments of that post. There are also more comments in this forum thread and in the GiftsforBanking.com reviews section.

GiftsforBanking.com is part of iGObanking.com which is a division of Flushing Savings Bank, FSB, a New York bank with $4.25 billion in assets and 16 branches. The bank's overall health score at DepositAccounts.com is 3 out of 5 with a Texas Ratio of 24.36% (above average) based on September 2010 data. It has been a FDIC member since 1943 (FDIC Certificate # 16049).


  Tags: GiftsforBanking.com, CD rates

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Comments
8 Comments.
Comment #1 by Anonymous posted on
Anonymous
Last November I opened a GiftsForBanking 2-year CD for $50,000.  It provided a very good rate of 2.0%, which by itself would have been enough.  The "gifts" were a terrific bonus.  The offer made clear that the "fair retail value" of the "gift" I selected would be reported as interest on the 1099-INT.  But it was NOT clear how much that would be.  I selected a 32" LG high-definition TV, and am very pleased with it.  The "gifts" agent was very helpful in sending me detailed descriptions of the three different TV's that were offered so I could do research to make my choice.  But then when I got the 1099-INT they actually added $1100 into the amount of interest reported to the IRS, which means that I will actually pay about $385 in extra federal and state income taxes for my "free TV."  Buying the TV on the internet or in a local store might not have cost much more than that.  I think the bank is actually making a profit on the "gifts" by writing off the $1100 as a business expense, which for them probably save about $550 in taxes, which is more than what they have to pay for the TV.  Very interesting!

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Comment #2 by syncomm1 posted on
syncomm1
I opened a CD in Nov at the 2% rate. As with opening most new accounts, there was some "birth pain" but overall I was pleased with the service. The amount that appeared on my 1099 for the gift was certainly on the high end of retail with tax and shipping...but not outside reality. Just choose a gift you can get an accurate price for...limke an iPad or a camera. Who knows what a motorized kayak or a massage chair would sell for?

If you can use the gift, then just figure out what its inclusion on your 1099 would cost you after tax. It may be worth it. And the fulfillment house is helpful and responsible.

2
Comment #3 by Anonymous posted on
Anonymous
Yes, they reported over $700 in excess of what that LG HDTV sells for on Amazon.com.  This CD special is only special for the bank, as they make money on all the gifts that they report to the IRS at inflated prices and they get your money at well below the rates offered by other internet bank specials. Banks are doing everything that they can think of to make money and take money away from savers.

4
Comment #4 by Gin (anonymous) posted on
Gin
There is no such thing as gift.

People who open such CDs are paying with their own money, by receiving lower interest rates and on top of that, paying retail price on the so called gift in income taxes.

Some persons are gullable and might fall for it, not me.

7
Comment #5 by Anonymous posted on
Anonymous
To syncomm1,
I opened a CD in Nov at 2.65% with $100K and are making $650 more per year than you do.
Multiply that by the years in that CD and you will see a big difference in interest received.
Your gift cost you $650 multiplied by the number of years you r CD is issued for.
No brainer for me.

3
Comment #6 by Anonymous posted on
Anonymous
Of course the bank is making money by offering these "gifts." Cannot fault them that.

To the poster who got 2.65% at the end of November--congratulations to you. That was a great gift to you. What bank was that? We searched this site and all others we know and there was no CD that offered the 2% let alone the gift. 

2
Comment #7 by Anonymous posted on
Anonymous
To Anonymous - #6,

To satisfy your curiosity, it was a small credit union in Miami, it had a banner on the window  advertising special CDs  for the week in November 2010 for 2.65%.

2
Comment #8 by Terri L. (anonymous) posted on
Terri L.
In my local area, we still have CD's ranging from 2.50% to 3.00% APY, even now, depending on the term.

1