USAA Amex, BCP, PRG, Platinum

American Express forum. Talk about AmEx credit cards like Blue, Gold, Platinum, Centurion, and more.
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rockyrock
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Postby rockyrock » Fri Oct 11, 2013 5:32 pm

My BCP arrived yesterday and came with a $17.5k limit. I was pretty surprised since just a few months ago my SPG came in at $4k...
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perfectson
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Postby perfectson » Thu Dec 19, 2013 1:25 pm

Spunky wrote:
However, USAA updated their cash rewards to bonus gas and groceries; it's tiered up to 2.25% gas/groceries and 1.25% for everything else—but those are uncapped and no fee. If I were staying put somewhere, I think I would go with the refreshed USAA as it would quickly overtake the BCP and with better benefits.




I signed up just to have a convo with you. I have both the USAA AMEX and just signed up for the AMEX BCP, i would say that after reading the literature and doing the analysis you might be off base with some of your comments regarding USAA vs BCP.

It sounds like you're aware that the USAA is a tiered rewards systems. But just in case, let me reiterate the tiers.

regular goods
1. 0 - 5K = .45%
2. 5K - 10K = .85% + $22.50 (over 5K)
3. 10 - 17K = 1% + $65
4. 17K more = 1.25% + $135

gas and grocerioes
1. 0 - 5K = 1.45%
2. 5K - 10K = 1.85% + $22.50 (over 5K)
3. 10 - 17K = 2% + $65
4. 17K more = 2.25% + $135

Let's say you purchase $10K on your credit card , with 2K in gas, 2K in groceries, and 6K in all others purchases.

The math for BCP is straight forward you will earn $240 (minus $75 for annual fee) = $165

THe USAA requires some calculation and understanding of the precedents of the tier system. Using a calculation that splits the gas, groceries, and other purchases proportionally between the tiers, you will make

1. 42.50 in the first tier
2. 62.50 in the 2nd tier
3. 22.50 in the 2nd tier for the flat rebate
4. total is $127.50

so even with the annual fee BCP wins.

Now if you spend $1 extra you will now be in the 3rd tier for USAA (which is negligible for cash back but you do get the $65 flat rebate, which would make USAA slightly better).

So in certain scenarios USAA could be better but i think in most scenarios (if you're heavily purchasing gas/groceries) you will get better cash back from BCP.

rockyrock
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Postby rockyrock » Sat Dec 21, 2013 7:03 pm

So just to clarify: all your combined spending will determine the tier you achieve and then from there your rebate will depend on how much in each category?
American Express (2005): Premier Rewards Gold & Blue Cash Preferred
Chase: Freedom & UA Club USAA: Signature Visa & American Express
Discover it Bank of Hawaii Hawaiian Airlines WEMC Synchrony Sam's MC
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perfectson
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Postby perfectson » Sun Dec 22, 2013 7:22 am

rockyrock wrote:So just to clarify: all your combined spending will determine the tier you achieve and then from there your rebate will depend on how much in each category?


That is correct.

I'm open to challenges or corrections.

The one thing I'm not 100% on is if you get all the flat rate cash backs if you hit every tier (i.e. the $22.50, $65, and $135) or if you only get the one from the current tier. Which makes a huge difference. I might place a call to confirm this but the math I did above assumes you get both cash backs as you hit tier 2 and tier 3.

perfectson
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Postby perfectson » Mon Dec 23, 2013 7:36 am

perfectson wrote:The one thing I'm not 100% on is if you get all the flat rate cash backs if you hit every tier (i.e. the $22.50, $65, and $135) or if you only get the one from the current tier.


USAA reps (whom are all awesome from a CS standpoint) didn't know initially about whether you get the both $22.50 and $65 if you hit tier 3, said it was the first time she heard that question being asked lol ;) .

After further investigation she was able to find the answer and that is....you only get the paid for one tier. So if you hit tier 3, you get the $65.

Spunky
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Postby Spunky » Mon Jan 13, 2014 11:37 am

perfectson,

I think you are right that my comparison is a bit off; I refined my calculation to reflect the USAA rewards program in more detail and it is less favorable.

Based on my own past cash rewards, I can definitely confirm that you get the flat rebate only for the current tier. It simply acts as a graduated rewards system. The flat rebate is actually just the total cash back you'd get at the previous tier. e.g. $5000 * .45% = $22.50; you then earn .85% on the next $5000, etc. The advantage technically is that once you reach the top tier it is uncapped.

Based on your rewards charts it appears as if you simply get a 1% bonus on gas + groceries (which is much more simple to say!). In my updated formula, I've calculated the base rewards (accurate within about $1 compared to my actual received rewards), then add and additional 1%*[Gas + Groceries].

If that's accurate, your scenario comes out even worse - $105 vs $165. While it is still true that the USAA card can eventually eclipses the BCP, we are talking numbers that are uncommonly high—upwards of 90-100k per year.

Interestingly the BCP effective cash back rate appears to hit its peak right around $30k/year, around 2% depending on spending mix. This maxes out the groceries category. Beyond this it slowly drops, where the USAA cards slowly rise. Interestingly they all kind of approach something around 1.5% with mixed categories.

Anyway, it is worth noting that with enough spending it is a decently competitive card, but the main perks are definitely in the generous protection levels, concierge service, and the fact that USAA has been a great company.
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