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The financial business is a dog-eat-dog world. So when companies decide it's time to fight for your business, it pays to play hard-to-get -- because the price financial firms are willing to pay to get you to become a customer has gone higher than ever.

Below, I'll share two tips that have earned me thousands of dollars over the years. But first, let's take a look at why financial companies are willing to be so cutthroat to earn your business.

Looking for the right people
More than anything else, what financial companies learned during the financial crisis was how much their best customers were actually worth to them. For instance, with credit card companies, as long as default rates were relatively low, they could potentially make a lot more money on interest charges than they ever could from interchange and merchant fees. As a result, those who paid their balances in full were ostracized as "freeloaders" who weren't paying their fair share for the convenience of credit.

But once banks had to start writing off those loans, the importance of a high credit rating rose dramatically. Suddenly, those freeloaders were valued customers again -- and rightfully so, given their dependability even in the midst of a tough recession. And with financial institutions trying to make the most of the new normal in the U.S., grabbing up those valued customers is worth paying for.

Get the credit you deserve
If you play your cards right, taking out a new credit card can get you huge rewards. Consider these current deals:

  • JPMorgan Chase (NYSE: JPM  ) is offering points on its Sapphire Preferred card that are worth $500 in cash or $625 in travel credits. All you have to do is spend $3,000 on the card in the first three months you have it.
  • Until December, Citigroup (NYSE: C  ) offered points worth $500 on its Thank You card in two equal installments, if you spent $5,000 in the first six months and another $5,000 in the next six months. That offer has now expired, but a similar offer gives you points worth $250 for spending $2,000 in the first three months.
  • Even smaller issuers sometimes make great deals. Pentagon Federal Credit Union, for instance, offers 5,000 points worth $50 on your first purchase, along with 20,000 more points if you spend $1,000 in your first three months.

It's true that opening card accounts with the intent of closing them soon after getting your rewards will hurt your credit score somewhat. But if you have flawless credit, then sacrificing a few points shouldn't cost you much -- compared to what you can gain.

Investing has never been so profitable!
The other area of financial services where companies are bending backward to get your business is in the brokerage arena. Take a look at some of the offers available right now:

  • TD AMERITRADE (Nasdaq: AMTD  ) will pay you a $100 bonus to open a new account with $25,000. That goes up to $300 for $100,000 deposits and $600 for $250,000 or more. Moreover, you also get two months of free no-commission trades.
  • Similarly, E*TRADE Financial (Nasdaq: ETFC  ) offers up to $600 for IRA rollovers of $250,000, with $250 bonuses for $100,000 rollovers and $100 for $25,000. E*TRADE also offers two months of free trades.
  • Fidelity is offering Apple gift cards worth up to $500 for new accounts or deposits of $300,000 or more, with $300 cards for $150,000 or more and $100 for $75,000 or more.

Admittedly, few people have this much cash lying around waiting to get invested -- and those who do probably won't think a few hundred dollars is worth the bother. But if you've been looking to switch brokers anyway, then getting a little extra money for your trouble is a nice boost.

What's the catch?
Thousands of people take advantage of deals like this on a regular basis to get paid for their good credit and savings habits. So if you're looking for a credit card, brokerage account, or other financial service, keep your eyes open -- you may well find a company that's willing to pay you a lot more than you'd expect for your business.

Being smart about your credit is just one part of preparing for a prosperous retirement. Smart investing is also important. The Motley Fool's latest special report highlights three smart stock picks for retirement investors, and we won't charge you anything at all for it -- but it won't be around forever, so read it today while it's still available.

Tune in every Monday and Wednesday for Dan's columns on retirement, investing, and personal finance. You can follow him on Twitter here.

Fool contributor Dan Caplinger picks up $100 bills when he sees them on the side of the road. He doesn't own shares of the companies mentioned in this article, although he's happy to take their money. The Motley Fool owns shares of JPMorgan Chase and Citigroup. Motley Fool newsletter services have recommended buying shares of TD AMERITRADE. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Fool's disclosure policy is its own reward.


Read/Post Comments (7) | Recommend This Article (34)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On February 08, 2012, at 5:33 PM, futbolgenius wrote:

    I, for one, think it's terrible advice to look at the special deals on offer when switching brokers. Turn those offers into investor-speak: they are all the equivalent of 0.2% yield, or less. Just imagining having that conversation with an investor friend. "I'm moving all my money to Fidelity!" "Why?" "They're giving me $500 in Apple gift cards!" Don't you have $750k in your account? You really think that's worth it?" "Yeah, but, APPLE!"

    Now I realize that money is money, and every penny counts, and some other cliches that aren't worth my time. The point is, you're advocating making a brokerage switch (which is a BIG DEAL, even if one WANTS to make a switch) based on a paltry payout. No, the things that really count are the interface, trade fees (not simply 2 months free), reinvestment capabilities in all types of accounts, customer service, etc etc. I know clicks count and subscribers are how you guys get your bills paid, but come on.

  • Report this Comment On February 08, 2012, at 8:08 PM, TMFGalagan wrote:

    @futbolgenius - I certainly agree with you that switching *only* to get the bonus doesn't usually make sense. But if you're looking to switch anyway - or you wanted to open the account at that broker in the first place - then the deals are just icing on the cake.

    best,

    dan (TMF Galagan)

  • Report this Comment On February 08, 2012, at 8:10 PM, TMFGalagan wrote:

    One note: Scottrade has a similar offer for IRA rollovers - $100 bonus if you roll over $15,000 or more.

    best,

    dan (TMF Galagan)

  • Report this Comment On February 08, 2012, at 10:54 PM, Estrogen wrote:

    Fun stuff to think about, but no one ever got rich off of credit card points, bonuses etc. Problem with the cards is that one is incentivized to spend more than they might normally.

    You reply, "but I was going to use it anyway."

    Us humans are great rationalizers. Studies show that when one pays with a card, we tend to spend about 15% more than with cash. Eats up any bonuses rather quickly.

  • Report this Comment On February 08, 2012, at 11:48 PM, MichaelDSimms wrote:

    This article sounds like a commerical.

  • Report this Comment On February 09, 2012, at 9:09 AM, BioBat wrote:

    @Estrogen,

    No one ever got rich but many get some fantastic rewards. I live pretty frugally but I still manage to pick up $100 in rewards gift cards every 3-4 months from my credit card use that I then put towards everyday items.

  • Report this Comment On February 19, 2012, at 5:36 AM, gilsh wrote:

    this does seem quite on the commercial edge...

    especially the facts, compared with the "earned me thousands of dollars over the years" claim. one cannot earn thousands of dollars by keep closing credit accounts, and not expect this policy to come back one day and bite one in his ass, when his credit rating looks poor. this is more of a one time play.

    in general, replacing one's financial services is not something one should do lightly. finding a reliable service is hard, and establishing trust with the people who work for that service is important.

    sure, everyone should supervise their costs, and aim at minimizing them, and sometimes the only way to cut costs is to find a new service provider, but on many occasions, all you have to do is negotiate.

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Dan Caplinger
TMFGalagan

Dan Caplinger has been a contract writer for the Motley Fool since 2006. As the Fool's Director of Investment Planning, Dan oversees much of the personal-finance and investment-planning content published daily on Fool.com. With a background as an estate-planning attorney and independent financial consultant, Dan's articles are based on more than 20 years of experience from all angles of the financial world.

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