Update 7/20/21: HMBradley has changed into invite-only mode for now, so you can only sign up now when using a referral link. Each referral link is only valid for three invites. Hat tip to reader Johnz (businessinsider article – paywall)
[Update 7/23/20: We initially wrote a quick review about HMBradley in November 2019 when this account was introduced, then reposted on 3/30/20 when the account launched. Yesterday, HMBradley released a credit card too, and there’s been more discussion about this account. Reading reader’s reports and comments got me thinking the account looks pretty interesting, so I reworked and updated the review below. Please chime in with any missing information and we’ll add it in.]
Fintech company HMBradley offers a hybrid checking/savings account with up to 3% APY savings rate when you receive a real direct deposit to the account. If you save 20% of the direct deposit each month, you’ll receive the top tier 3% APY rate. You can even earn 3.5% APY if you have their credit card.
Maximum of $100,000 is eligible to earn interest. There is no hard credit pull to open the bank account. Interest is paid monthly. All deposit accounts are provided by Hatch Bank, Member FDIC.
- Tier 1 earns 3% APY – requires saving 20% of deposits
- Tier 2 earns 2% APY – requires saving 15% of deposits
- Tier 3 earns 1% APY – requires saving 10% of deposits
- Tier 4 earns .5% APT – requires saving 5% of deposits
- If you save less than 5% of your deposits, you’ll earn 0% interest
You need a real monthly direct deposit in order to earn interest with HMBradley, but the interest is earned on the entire balance in your account. For example, if you have $100 monthly direct deposit and save $20 per month, you’ll then receive 3% interest on your entire $100,000 balance. The goal is to save 20% of your direct deposit; if you are able to split your employer direct deposit, you can have any small amount deposited which would make it easy to save 20% of that in the account.
Qualifications are quarterly, so you’ll want to establish an account with qualified direct deposit now, save at least 20% of all your deposits this quarter, and then wait for the beginning of the following quarter to deposit $100,000. For example, you can set up your account with direct deposit in August, wait until the end of September to deposit $100,000 into the account, and you’ll begin earning 3% on October 1st. (You’ll probably want to deposit less than $100,000 to leave room for a number of quarters worth of direct deposits, without messing up the 20% savings requirement.)
[Note a confusing twist: while you need a real employer direct deposit of any amount to qualify for any interest rate, you also need to save 5-20% of ALL deposits each quarter. For example, suppose you get $100 directly deposited each month during July though September, and you also ACH deposited $50,000 into the account in September; you’ll need to have an end balance of at least $10,060 on September 30th in order to qualify for the top Tier 1 rate. That’s 20% of the $50,000 + $100 + $100 + $100 which is your total deposit amount for Q3 2020.]
HMBradley also offers a credit card which has a $60 annual fee (waived the first year) and offers 3% cashback on your top spending category each month. Read full details of the credit card in this dedicated post.
Relevant for our discussion: those who have the credit card get their rate boosted from 3% to 3.5% which can mean up to $500 in extra interest per year. (It’s not as good as extra credit card rewards, for tax reasons, but still a nice boost.) If you are in Tier 1, you get bumped up an extra .5% for having the credit card; if you are in Tier 2, Tier 3, or Tier 4, you’ll instead get bumped up one tier higher for having the credit card. You only get the credit card boost if you spend at least $100 on the card each month and have recurring $2,500 in monthly direct deposits.
3%/3.5% is very nice in the current environment, and honestly in just about any environment. Some people will find the direct deposit and savings requirement easy to deal with, making this HMBradley account a real winner for stocking away cash reserves of up to $100,000. It’s not clear they’ll be able to keep the 3% rate forever, but it’s been going on for a number of months, and hopefully it can continue for a while, especially if interest rates rise.
Update 11/28/20: If you use a referral link between now and December 25th, you get to jump straight to Tier 1 after receiving your direct deposit. More details and to find or leave referrals, visit this page.