Investment platform Robinhood is launching a credit card, and it almost sounds too good to be true.
Continue reading: Wow: Robinhood’s 3% Cash Back Credit Card
Share your questions, experiences, and thoughts below.
I wonder if you refer 10 people that they'd let you get a plastic version of the card? There are people that don't like the weight of a metal card in their wallet.
No chance I’d sign up for anything coming from this shady company. They illegally suspended retail trading of certain stocks to allow hedge funds to cover their shorts. No one should trust them
Wouldn't $5 per month equate to an annual fee of $60 per year instead of $50?
And to echo 305's comment, why would anyone want a card associated with a trading platform that just arbitrarily shut off the "sell" function during the whole Gamestop short event a few years ago? No amount of rewards would entice me to get within a mile of applying for this card.
@ Euro -- There's a discount if you pay the annual membership fee rather than paying month-by-month.
Not unheard of. Many of us still have the AOD Federal Credit Union Visa Signature card with 3% uncapped and auto credited each month back to the statement. No annual fee and no FX fee. They closed the card to new signups after a year or two, and underwriting was manual on every application and very conservative, but it was a well publicized card. Membership was open to anyone who signed up for a local mountain biking association for a tiny one-time donation.
This isn’t *that* unheard of, the Fidelity cashback card gets 3% as a member of rewards+, if you have over 2 million in assets at Fidelity.
They did nothing illegal according to the government.
But people should know better. Their name says it all, Robin from the hood.
Exactly! It's gotten so bad that I'm excited now when a new card arrives and is plastic.
I smell "Bait and Switch" in the future. Like many financial institutions, Robinhood will offer benefits that's "Too Good To Be True. But once they penetrate the market with mass adoption, they will scale back these offerings and start diluting benefits. Like the old saying goes "New $hit, same old pile".
That 3% is a great deal if you’re paying your taxes with it, if you can get a big enough credit line.
The BofA VISA tops out at 2.62% for non-entertainment/travel. An extra 0.38% back would make a big difference.
As a Visa Signature, its interchange fees will average about 2.2 percent. So, where are they getting the extra 0.8 percent? Moreover, the recent settlement will bring those interchange fees down to about 1.6-1.8 percent over the next five years.
Get the card, sign up 10 people, get the gold card, cancel the account, and sell the gold. If it's 17 g like the steel card, and it's really "solid gold", it's worth $1200.
Of course, like everything else with Robin Hood, I'm sure every part of "solid gold card" is misleading.
Either, as some suggested, it's a short term bait and switch, or they think that $50 + whatever revenue they get from any other business from you will be worth it to them. ¯\_(ツ)_/¯
I'm waiting for the Ben post about the new interchange fee agreement. That has the potential to change his game a lot.
The Gold subscription fee is $75/year or $6.99/30 days according to the fee schedule on Robinhood's website. Not sure how you got the $50/year number.
Here is the link to Robinhood's fee schedule: chrome-extension://efaidnbmnnnibpcajpcglclefindmkaj/ https://cdn.robinhood.com/assets/robinhood/legal/RHF%20Fee%20Schedule.pdf
My apologies. Her eis the actual link:
https://cdn.robinhood.com/assets/robinhood/legal/RHF%20Fee%20Schedule.pdf
Not sure that this card is any better than USBank’s Altitude Reserve. I actually think it’s worse. The reserve gets me 3% cash back on every tap-to-pay purchase (most stores and online shops will take Apple Pay these days). In Europe, everything is tap to pay so that’s every purchase on vacation for me. Plus, if I redeem for travel this ends up being 4.5% cash back on almost everything. 3% on everything sounds good but (1) I trust US Bank more (2) I already get the same or better from my cards and (3) I get really great insurance from a card the costs net $75 a year (after getting $300 back on dining or travel). I feel this is just advertising to people who react to flashy advertising without looking too closely at the fine print and actual benefits. For plain cash back even the 2% citi cash back may be better if you consider the fee.
Agreed. The US Bank Altitude Reserve is my primary card and it is effectively 4.5% cashback via Real Time Rewards.
Tap/Apple Pay acceptance has skyrocketed since COVID. Even at small businesses with non-customer facing card terminals, the terminals are typically tap-enabled. Asked about Apply Pay at my doctor's office once, and the staff had no problem just holding the card terminal up for me to tap.
Since RH Gold comes with $1,000 of interest free margin, easy to offset 'annual fee' with BOXX
Amazingly compelling product
Not sure if trading options just to cover the annual fee is a good idea for most people.
BOXX is not an options trade
Long dated index options incorporate the 'risk-free-rate' (T bills) and a box is a complex options strategy that delivers the risk free rate
BOXX is just a tax efficient ETF wrapper around that strategy, that as the term 'risk free rate' captures, is pretty much risk free
Get as many credit cards as you can. Use them to buy a whole bunch of things you don’t need. Feel good about getting 3% back and having “cheated the system”. Sounds like the American dream…
This looks good to me as my everyday purchase card is currently PayPal 2% on most things, 3% on PayPal. I do have other cards for Gas and Groceries, but I think this will be for everything else.
3% is a nice upgrade and helps me consolidate restaurant, travel (their travel portal 5%) and Costco spend onto this card as well as that was 2 or 3. Less cards to manage for different categories.
It appears that the fee is $50 annual (of pay up front). That is totally justified for me with the current amounts we put on the PayPal monthly.
Additionally, if you are into it, it appears that the included free access to margin to make money on a low risk ETF.
Lastly, depositing the cash back back to their 5% sweep/brokerage account means it could just hang out there bearing interest as that is the same as my HYSA.
If anyone else wants to make the jump, please use my referral link below. It helps me get a bonus.
https://robinhood.com/creditcard?referral_code=7ba7271e