Brokerage transfer bonuses are too good to be ignored

I've found a surprisingly small amount of information online about brokerage transfer bonuses. I'm not sure if this is a recent WealthSimple-driven phenomenon or if I'm very late to the game, but I wanted to jot down some thoughts for sharing with friends and family. 

Financial institutions are willing to pay (you!) a percentage of the value of your assets if you are willing to make a transfer to their institution, as long as you keep your funds there for a set period of time. The better bonuses pay around 2% or more (annualized) but even smaller amounts all add up. A free 1-2% on whatever gains you're getting in the market is huge when compounded over time. 

This can be incredibly lucrative if you're in the fortunate position of having a chunk of long-term savings you can shift around at will. This is a wealth-building hack that not enough people are talking about. 

Easy math: 

2% of $250k is $5,000. 

2% of $1M is $20,000. 

This is not chump change! If you have $250k to move around, $5000 is a good chunk of a family vacation. If you have $1M to move around, $20k is a big chunk of a renovation or unplanned expense. If you have more than $1M to move around, a substantial portion of your annual expenses could be covered by bonus money. 

What to look for in transfer bonuses

I'm not going to link to any offers because they change all the time. I strongly recommend reading the fine print on each offer. I mean literally reading the fine-print terms & conditions to understand the eligibility rules to receive each bonus. In my experience they are often surprisingly clear and readable. 

Here is what I am looking for in the terms: 

• Key dates: Obviously you want to know when you can sign up for the bonus, the "funding period" where funds from other institutions should be transferred in, and the payment schedule for the bonus (is it paid monthly, in instalments, or at the end of the holding period?). 
  
  
• Holding period: How long do your funds have to remain in this institution to receive the bonus? 
  
  
• Eligible accounts: What account types are eligible? Unregistered/taxable, RRSP, TFSA, RESP, LIRA, etc. Can you do self-directed investing (my strong preference so I can buy low-cost index funds and forget about it) or are you required to pick some managed mutual fund? I saw one bonus that was the latter model, and the management fees the funds charged canceled out the bonus. 
  
  
• Account requirements: Is the bonus paid into the eligible account, or is a different account required to receive the bonus? For the first WealthSimple offer I chased for investing accounts, Robyn & I each needed to open a chequing account there to receive the cash bonus. 
  
  
• Bonus calculation: Exactly how is the bonus calculated? Most I've seen are based on a snapshot of the value of your assets at the moment they are transferred over. WealthSimple calls this "net deposits", TD calls this "total funding amount", and I'm sure other institutions call it something else. If the value of your assets drops due to market fluctuations, the bonus is still based on your net deposits (unless you've made withdrawals or the value of the account has fallen below some minimum threshold). 
  
  
• Bonus rate (annual): Don't get hoodwinked by marketing. Convert the bonus rate to an annualized (yearly) value. In my opinion, 2% annual is a damn solid rate. However I have seen marketing for transfer bonuses advertising a 3% rate (with fine print: with 5 year holding period, which works out to an abysmal 0.6% annual bonus). 
  
  
• Bonus limits: What is the maximum bonus available to you? 
  
  
• Withdrawal rules: If the unexpected happens and you need to draw on your savings, what are the impacts to the bonus? Note that it likely depends on the bonus payment schedule. 
  
  
• Offer stacking: What happens when you stack offers at the same institution? One area to watch is the bonus calculation. For example. We moved a bunch of money to WealthSimple for a 2% bonus. Let's say my net deposits were (X). Later, when I left my corporate job, there was another WealthSimple offer to get a pair of Apple Airpods, so I transferred over (Y). Why not, I thought? I didn't read those terms as closely, but the net deposits stacked! In other words, the minimum net deposits to maintain for a pair of Airpods was (X+Y), which happened to be a significant chunk of our net worth. If we had an emergency requiring a big withdrawal, WealthSimple would have docked my account by the value of a pair of premium headphones! 

Strategies and considerations for transfer bonuses

If you're planning on chasing transfer bonuses, consider the following: 

• Track everything: Hopefully, you already have a financial spreadsheet with details of your accounts and holdings, but if not, now is the time to start. Be sure to track bonuses, minimum net deposits to maintain, expected payment schedules, and the end date of the bonus period so you can go shopping for the next one. 
  
  Additionally, put calendar reminders in place so you can monitor for expected payments and bonus period end dates. 
  
  
• Be a couch potato: By that I mean, Canadian Couch Potato investor. Buy and hold low-cost index funds. If you are an active trader you will not be inclined to move funds to the Big Banks and their $10 trades; you'll want to stay at Questrade or WealthSimple or a low-fee brokerage. However if you just buy and hold index funds, who cares about spending $100 on a year of trades for contributions and rebalancing when thousands of bonus dollars are rolling in? 
  
  
• Transfer to get the maximum bonus, but not more: In other words, keep as much dry powder for the next transfer bonus as possible. If a 2% bonus has a maximum payout of $15,000, you should not transfer more than $750k to that institution. Save the rest for another offer. 
  
  
• Remember that you can split accounts, and partial account transfers are possible: It is not always obvious that there is no "rule" about how many RRSP, TFSA, RESP, etc. accounts you can have, so long as the rules about each account type are followed in aggregate. On the most recent transfer bonus I signed up for, I created a new RRSP account at the new institution, then initiated a partial transfer of assets from my existing RRSP, so I'll have two accounts for the time being. 
  
  
• It's not actually that hard to move accounts: If you've never done it, it's intimidating. But like anything else it gets easier each time you do it. Anecdotally, it was incredibly easy to move a pile of accounts over to WealthSimple. And more recently, it was incredible easy to open a new account and do a partial transfer to TD (previously it was incredibly painful). 
  
  
• Moving in-kind assets keeps you in the market: If you're worried about missing gains in the market, know that you can move in-kind assets (e.g. "transfer 100 shares of VEQT") instead of selling everything to cash, transferring cash, then buying again (this would also impose capital gains in taxable accounts). One downside of mutual funds is that they may be institution-specific and may not transfer in-kind. 
  
  
• Funds aren't "locked in" to bonuses: If you move an account to receive a bonus and life circumstances conspire so that you have to make a withdrawal, it's still your money. Withdraw it as you need, the worst case outcome is that you forfeit some or all of your bonus. If and when that happens, just chase the next signup bonus. 
  
  
• Don't be loyal: I've seen comments online from those who look disdainfully at transfer bonuses from banks with less functional apps and less flashy websites (I'm looking at WealthSimple fans). Ok, I agree WealthSimple has a terrific UI, but if another bank is offering me 2% on $1M, would I forfeit $20,000 just because I like their app better? Hell no. 

Risks, constraints, and concerns 

Here are some negative or limiting factors to consider when chasing transfer bonuses: 

• Long-term employment: If you've been gainfully employed by the same employer for your whole career (or most of it), chances are a huge chunk of your long-term savings are tied up in your employer's group RRSP and pension. Usually participation in the group plan is not negotiable and you won't be able to transfer out of these until you leave that employer. 
  
  
• Monitor contribution limits & registered accounts: I have yet to figure out how bonuses paid into a registered account (for an RRSP I just opened) impact the contribution room of that account. For my RRSP example, I will be sure to leave a contribution "buffer" of what I expect the bonus to be, and see what happens at tax time. 
  
  
• Are bonuses taxable? Good question. I don't know the answer! A few cursory searches I did around tax-time this year suggest "no", but that may change based on rulings from the CRA. It likely depends on how the bonus is paid and structured. 
  
  
• Small accounts: What is the smallest possible bonus you're willing to chase? This will be different for every person. For example if you have $10k in a TFSA, would you transfer it for $200?
  
  
• Brokerage reliability: Maybe this should be at the top of the list. What brokerages do you, or should you, trust? Anecdotally, a friend backed out of an attractive transfer bonus deal at WeBull because the institution is foreign-owned. 
  
  

Past bonuses we've got 

Robyn and I have benefited from the following: 

• WealthSimple Winter Bundle: this was 2% on net deposits paid over 2 years, so 1% annually. The nice thing is that it's paid monthly. Part of the catch is that bonus payments don't count towards "net deposits" so in a way the bonus cash is locked into WealthSimple until the end of the 2 year period. Since our TFSAs moved to WealthSimple has part of the transfer, the bonus made up a good chunk of our 2026 contributions. 
  
  
• WealthSimple Airpods: I snagged a "free" pair of Airpods Max after quitting my full-time job and transferring my employer pension and RRSP to WealthSimple. It was a pretty low-value redemption though (less than 1% if I recall), but hey - free premium headphones. 
  
  
• TD Aeroplan: I got a targeted mailout as an Aeroplan cardholder with a pitch for a points-based transfer bonus. I read the T&C's and they were reasonable. One year holding period, with the points distributed 25% shortly after enrolment, 25% at the halfway point, and the remaining 50% at the end of the term. This was a solid bonus, right around 2% value (based on typical Aeroplan points conversion). 
  
  
• TD Easy Cash Offer: The most recent one (and it may still be live as of this post), get 3% cash back on eligible accounts over about 2 years, so about 1.5% per year (the actual dates & timelines drag this a bit lower). Not bad, though the bonus is paid just twice, at the end of each of the 1-year period. 
  
  

Questions for those who have randomly found this post

Leave a comment - I am curious to know: 

• Where do you learn about new transfer bonus opportunities? I find them hard to find organically. 
• What did I miss? What do you look for in transfer bonuses? Are there any risks I missed?