Difference between revisions of "Bank of america cash rewards card"
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| − | <li>''' | + | <li>'''The signup bonus on the Cash Rewards card is a not that interesting'''. You'll receive $200 (with $500 initial spend). The primary reason to get the card is for the bonus category reward rates. In the past, we would have recommended signing up for the Premium Rewards card (for its 50,000 point bonus) and converting it to a Cash Rewards card. But with the new restrictions on getting the Premium Rewards card, you are more likely to have to get the Cash Rewards card directly.</li> |
| − | + | <li>'''There are restrictions to earning the signup bonuses multiple times'''. You aren't eligible for the Cash Rewards card, if you've received one in the last 24 months. But, you don't have to cancel it, in order to apply for another card.. In addition, you are still subject to BOA's overall rules of two new cards every three months, three new cards every year, and four new cards every two years.</li> | |
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Revision as of 20:39, 11 January 2019
No annual fee
20,000 points
$500 initial spend
($200 net value, .40/$)
Signup Bonus Chart3-5.25% on 1 category of your choice
2-3.5% Groceries and Wholesale Clubs
1-1.75% Everything Else
3%% Foreign Transaction Fee
For anyone who can move $100,000 in investment or retirement assets to Merrill Lynch, this card earns a 5,25% reward rate on your choice of bonus categories (Gas, Online Shopping, Dining, Travel, Drug Stores, and Home Improvement + Furnishings). You can even change your category every month.
If you can't qualify for the higher reward rates, the reward rate is 3%, and the card is much less interesting.
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Bank of America Cash Reward Card options
There is a student version of this card. In addition, Bank of America issues a number of other credit cards that have historically had the same earning structure of the Cash Rewards card—the Susan Komen, World Wildlife, and U.S. Pride cards, and a set of cards for each baseball team. It is still unclear if these variants will offer the new "pick your category" reward rates, or if they will continue to only offer the 3% rate on the gas category. It is also unclear whether the new restriction on one Cash Rewards card every 24 months applies to these other card variants.
There is a business version of a Cash Rewards card, but it offers bonus rewards on completely different categories, and it requires separate assets in business accounts to qualify for the bonus rewards.
Bank of America Preferred Rewards Program
Bank of America operates a "Preferred Reward" program that provides extra benefits to their customers, based on the total amount of assets they have at Bank of America and Merrill Edge. Among the most valuable benefits is a boost to the rewards earned from many of Bank of America's credit cards. Preferred Reward Program.
If you have over $100,000 in assets, you'll be a Platinum Honors member, and get a 75% reward bonus. If you have between $50-100,000 in assets, you'll be a Platinum member, and get a 50% reward bonus. And, if you have at least $25,000 in assets, you'll be a Gold member, and get a 25% reward bonus.
This can make a big difference in how competitive a Bank of America rewards card is, compared to the competition. For example, the Bank of America Cash Rewards card earns 3% on the category of your choice, which is pretty good. But, if you have $100,000 in combined assets at BOA and Merrill, you'll get a 75% reward bonus, and the card will earn 5.25% instead, which is much better. Similarly, the Travel Rewards cards earns 1.5% on everyday purchases, which is less attractive than a good no-annual-fee cash-back cards (which earn 2%). However, with the 7%% bonus, they earn 2.625% instead, which is the best permanent cashback rate of any no-annual-fee card.
Even if you have that much money, you don't want to keep tens of thousands of dollars around in a low-interest rate checking account. But, you don't have to. If you have an existing retirement account, or investment assets, that you can transfer over to Merrill Lynch, you can qualify for the extra rewards, without any substantial additional expense. Your existing mutual funds, ETFs, bonds, stocks, and other investments should transfer over, without you having to sell them, and you won't incur any fees, except potentially a small account transfer or closing fee at your existing broker. Rates for any future sales or purchases are comparable to what is available elsewhere. And you don't need to move over all your assets, just enough to qualify.
Collecting the Signup Bonus
- The signup bonus on the Cash Rewards card is a not that interesting. You'll receive $200 (with $500 initial spend). The primary reason to get the card is for the bonus category reward rates. In the past, we would have recommended signing up for the Premium Rewards card (for its 50,000 point bonus) and converting it to a Cash Rewards card. But with the new restrictions on getting the Premium Rewards card, you are more likely to have to get the Cash Rewards card directly.
- There are restrictions to earning the signup bonuses multiple times. You aren't eligible for the Cash Rewards card, if you've received one in the last 24 months. But, you don't have to cancel it, in order to apply for another card.. In addition, you are still subject to BOA's overall rules of two new cards every three months, three new cards every year, and four new cards every two years.
Taking Advantage of the Airline Incidental Credit (Premium Rewards card)
- The Premium Rewards card includes an annual $100 airline incidental credit. Unlike the one from the American Express cards, it is not limited to a single airline that you select at the beginning of the year. If you can take full advantage of the credit, the effective annual fee drops below zero.
- Because the credit is issued on a calendar-year basis, you can qualify for two credits the first year you have the card. For example, if you sign up for the card in August, you can get up to $100 credit, for purchases made between August and December, and you can get take advantage of another $100 credit, between the following January and August.
- Credits only apply to incidental expenses like baggage fees, food and beverage purchases, and airport lounge access fees, not on actual ticket purchases. The credit for this card explicitly includes ticket change and cancellation fees, and preferred seating upgrades, which are often excluded from similar credits on other cards. However, it only includes flights that start in the United States, and that are operated by the major US airlines (Alaska, American, Delta, Frontier, Hawaiian, JetBlue, Southwest, US Airways, and United, but not Spirit).
- You are not supposed to receive the credit when you purchase a gift card from an airline. However, in practice, you are often reimbursed. If you don't have an opportunity to use the credit naturally, you can typically purchase $100 in gift cards, get reimbursed for your purchase, and then use the gift cards to eventually purchase actual airplane tickets. This works on some airlines and not others, and you need to keep each purchase under an airline-specific maximum, so you'll need to search online or experiment. Get Full Value from Your Airline Incidental Credits.
Using the Card for your Everyday Spending
- If you don't have $100,000 in assets with BOA and Merrill, you probably don't want to use any of these cards for your everyday spending. Without the 75% point bonus, the reward rates aren't as good as what you can get elsewhere. One of the two cards might still be interesting at the $50,000 / 50% bonus level. But the cards are definitely not interesting at any level below that.
- If you can qualify for the higher-level of rewards, you MIGHT want to use one of these cards as your general-purpose reward card. If you have $100,000 in assets with Bank of America and Merrill Edge, you'll earn 2.625% on every purchase made on these cards. For many people, that makes them the best general-purpose reward cards available. However, there are a few advanced options that can potentially be more valuable, although each has its own potential issues and limitations. Get a Great General Purpose Reward Card and Use It for All of Your Spending.
- The cards come with return protection, extended warranty coverage, and protection for lost and stolen items, but don't include price protection (which rebates the difference if something you buy is available cheaper elsewhere during the first 60-90 days). Automatic Protection for the Things You Buy with Your Credit Card.
- If you do want to use one of these cards, as your general-purpose reward card, you need to decide whether you also want to use it for your travel and restaurant purchases. This Premium Rewards version gives you a 2% base rate on travel and restaurant purchases, which turns into 3.5% with the Preferred Rewards bonus. If you have another credit card, like the Sapphire Reserve, you can earn even higher reward rates on these categories. If not, this is a pretty good card, but you should also consider using the Uber card, which has no annual-fee, and earns 4% on restaurants and 3% on travel. Best Credit Cards for Travel Spending. Best Credit Cards for Restaurant Spending.
- Even if you aren't interested in the travel and restaurant bonus reward rates, you might still consider getting the Premium version of the card, just for its signup bonus. You'll get an extra $300 when you sign up for the card. If you take the steps to make sure you always use the travel credit, you can offset the annual fee each year. So, even if you don't use the travel and restaurant bonus categories, you'd be better off. Of course, you could always get the Premium Rewards version, and downgrade it to the Travel Rewards version, after the initial year.
If you highly valuable premium-cabin award travel, and have the patience to find good award opportunities, you'll be better off earning Membership Reward or Ultimate Reward points, which you can use for frequent flyer tickets. If not, 2.625% cash back is very good.
Other Notable Benefits
- Access to the Visa Signature Luxury Hotel Collection. As with all Visa Signature cards, you'll get access to Visa's luxury hotel program. Whenever you book one of the 900+ participating hotels, you'll receive a set of valuable benefits, including free breakfast, late check-out, and a $25 food and beverage credit. The Visa program has slightly weaker benefits than the other luxury hotel programs, but includes a larger number of more affordable hotel options and a best price guarantee. Take Advantage of Luxury Hotel Programs for Valuable Extra Perks.
- Access to Visa Signature Offers. Your card entitles you to a set of special offers available from Visa.
- Free museum entry. As with all Bank of America credit cards, you'll get free admission to hundreds of museums on the first weekend of every month. Admission is for the cardholder only. Guests are not included, nor are any special exhibitions and other ticketed shows. Museums on Us.
- BankAmeriDeals. Bank of America has a shopping discount program that works like Amex Offers. To get each discount, you'll need to "activate" it through their website. Once activated, discounts are automatically applied when you use your card for the corresponding purchase. Most deals are cash-back based (typically 10%). BankAmeriDeals.
- $100 TSA Credit (Premium version). You get up to a $100 rebate of your your application fees for Global Entry or TSA Precheck. You can take advantage of the credit once every four years.
- Extensive travel protections (Premium version). Like the true premium credit cards, you'll get a full set of travel protections, whenever you use the card to purchase travel—including trip cancellation, trip delay, baggage delay, and lost baggage coverage.