While flipping through my Costco coupon book tonight, I noticed that ShareBuilder is running another promotion with Costco:
You can get a $70 or $90 Costco Cash card (depending on your membership level) after opening a new account and making one trade. They seem to be buckling down against people opening multiple accounts for bonuses, as it is now “one per unique account holder”. If you don’t have a Costco membership, there is also a similar bonus offering a $50 account credit.
Note: I just noticed in the fine print that you shouldn’t open the Costco-related account until 9/4, as that is when the promotion starts. How annoying, just like these post-dated Costco coupons…
Now, unless you really want to use Sharebuilder as your broker (and I don’t especially recommend it with free stock trades available now), there are two options to get your bonus, as selling stock there costs $15.
- Instant Gratification:Open with $5. Buy $1 of stock and pay $4* for commission. Wait for your bonus and cash out if applicable. Let the $1 in stock just languish there.
- Delayed Gratification: Open with $50. Buy $46 of a stock or ETF you like and pay $4 for commission. Get the $50 (or more), and treat it like you just got free stock. Let the dividends reinvest automatically, and just sit back for a decade or two while it grows.
I took the latter route. I bought partial shares of EEM for $42, and they are now worth $69. I also bought $46 of BRK.B, now worth $61. I love owning my 0.0153 shares of Berkshire Hathaway B. Ah, to be amused by simple things… 😉
*There may also be a free trial available, where you can sign up for the flat monthly plan, make a free trade, and then switch back to the Basic $4-per-trade plan before being charged the monthly fee. This way you don’t have to pay any trade commissions at all.
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Congratulations on owning 0.0153 shares of Berkshire.. you’re now in their little club! 🙂
-Raymond
LOL @ 0.0153 shares of Berkshire! Now you can say that you are a part-owner of Berkshire the same way guys try to impress girls by saying they drive a “Vette” when they actually have a Chevette.
One item to note is that it’ll cost you $15.95 to sell when you do want to get out. (Or $50 to transfer to another company). Pretty much takes out any increase on a small investment.
I keep thinking of trying this. has anyone who already has a Sharebuilder account taken advantage of this offer?
Also, of note (to add to Sick of Debt’s comments) you can only transfer full shares. The fractional shares have to remain in your Sharebuilder account if you tranfer to a new company.
I did this a while back and bought 2.6379 shares of Powershares Wilderhill Clean Energy ETF (PBW) for $46. It’s only worth $52 now, but since it was essentially free, I decided I like the thought of investing in some environmentally conscious companies. Even if it’s only ~$50 worth.
I just opened an account and think this is the way to get the most out of this Suntrust promotion:
1. Open an account with $50.
2. Be sure to sign up for the one month free trial. This makes sure you dont pay for 6 buying trades in the first month.
3. After the first trade is made be sure to cancel the monthly subscription to recieve 6 trades a month and go down to the basic $4 per buy trade plan.
4. 4 weeks after the first trade the $50 should appear in your account. Transfer that $50 back into your checking account.
I believe with this system you will have $50 of stock totally free!
Adam
Sharebuilder ? –
Calculating the tax basis on sharebuilder (partial-)shares seems like it would be a headache – especially if you hold on the the stock for, say 10 years and you factor in dividends and stock splits. Does the site maintain the tax basis of investments each time a partial share is purchased?
LOL, Chevette. Chevettes are cool!
I was actually curious to see if I got the annual report or was able to attend the shareholder meeting, but I forgot to follow up on that.
Adam – There is a minimum trade value even on the free trial, so either way you’re not getting all $50. Maybe closer, though.
Phoenix – Sharebuilder does offer Gainskeeper, but only on the premium monthly plans. I agree, it’s similar to DRiPs in that the tax accounting can be nasty.
Nick- Not quite accurate… if you transfer (I just did to Zecco) they’ll liquidate fractional shares at no cost to you and transfer the cash balance.
I took advantage of a previous offer of the $90 Costco Cash card for opening an account for myself, my spouse, and the 4 kids. I ended up putting $50 (46 after trade) in each account (even though you can do it with much less $$).
So counting the $50 per account and the $90 I got back that was $240 I “made” plus the various stock I purchased for the kiddies (McDonalds for one, Target for another, Coke, and Disney were the buys). All in all, not a bad purchase.
Jonathan–Why EEM instead of VWO?
I’m pretty sure VWO was not an option back then in 2005.
I took advantage of the deal right away. I love Costco and and this is a great place to start investing. Thanks for posting this, I posted it over on my Blog too and gave you credit of course. 🙂
It was the My Money Blog that inspired me to get control of my finances about two months ago I read faithfully every day ~ Thank you so much.
I just signed up with the $50.00 promotion and just got an email that said I would recieve the $50.00 once I set up a periodic investment plan??
Anyone else get this? I used the link in original post????
Cool, time to get $46 of BRK.B
$4 fee is for an ‘Automatic Investment’. It is $15.95 for a real-time trade… so I’m confused, doing OPTION 1, wouldn’t it cost $17 for a $1 stock?
http://www.sharebuilder.com/ShareBuilder/Fees/
I signed up for a Sharebuilder promotion around Mar/April and they didn’t offer Berkshire. I was going to go that route, but couldn’t! Oh well!
I might sign up again and see if they have it. The only problem is selling the shares later as they charge so much to do so.
Wanted to clarify. If you choose the BASIC account, it is $4 for each automatic investment. Automatic investments are recurring or one-time stock purchases that are executed on Tuesdays. So, there is the answer. 🙂
Oh, and if you do the $1 stock thing, and after you get your cash card you close the account and sell your share, “Note: For sell orders where the proceeds are less than the commission, the entire proceeds less $0.01 are taken as the commission. In other words, even if the stock is worth less than the commission, you will still receive $0.01 in exchange for your shares.”
Then have the $0.01 EFT (free) to your checking/savings account when closing the account. So basically, they agree to take the value of the $1 minus 1cent instead of $15.95 fee. 🙂
So my first stock purchase went through for $1 today. The $70 Costco cash card should be mailed out but if it takes more than one month do I let the automatic investment plan continue ($4 fee, $1 stock purchase?) or can I cancel that now?
Has anyone received their cash card yet?
Nobody will receive their card until 4-6 weeks from now (first trade that qualified was today if people were doing the $1 auto-trade).
Go to the bottom of your account page and turn the Automatic Invest Plan to OFF. That will stop it from continuing. I only transferred $1, bought 1.25 shares of LGVN for $0.98, and just sit on the account till the cash card arrives, then close the account and get my $0.01 back.
Just a notice, I received my cash card today, 18 days after opening the account, and less than 2 weeks after the stock was purchased.
I opened an account on 9/30 with the link above, which now shows a $55 bonus for executive members. So that’s what I got… I looked around for the $90 bonus offer, but couldn’t find it. Then – lo and behold! – the $90 offer cranked up again for October. I called ShareBuilder and asked them if they’d credit me the $35 since it looked like I’d hit some weird hole in the time/space continuum where the $90 offer wasn’t displayed on their sites. Took the front line agent 2 minutes to come back and tel me they’d do it and to expect the $35 in my account in a few days.
Brilliant customer service. Kudos to ShareBuilder.