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  1. #1
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    Default BofA Cash Rewards Visa/Mastercard (and other products)

    With the change in February, my old World Mastercard from BofA changed over to their new BankAmericard Cash Rewards card as I requested. For Visa holders, this is a Visa Signature card although mine was originally a Mastercard and still is from the transition (much like my Chase Freedom is a Mastercard after upgrading from a Slate Mastercard). So I decided to look closely at the new benefits. They are:

    3% on gas
    2% on groceries
    1% on everything else

    That sounds like a great all around card until you get to the point where you see the card is capped on gas and groceries for $6000 a year ($1500 a quarter, gas+groceries combined), much like Amex BCE is. So for a family like mine that spends three times that amount in groceries a year (before you even get to gas), it's less of a great deal but still not bad.

    Where things get interesting is that BofA apparently is borrowing on of Chase's more popular features in that you get a 10% bonus cash back award if you tie the reimbursement to an existing BofA checking or savings account. I would do that with Chase but Chase banks aren't in my region of the country. But BofA is and it's my primary bank, so that's a free benefit that can be dumped directly to my savings account.

    BofA also has a new BankAmericard Privileges with Cash Rewards card. Also a Visa Signature, this card carries a $75 annual fee and on the surface seems to have the exact same benefits as the regular cash rewards card. 3% gas, 2% groceries, 1% all else, same interest rates, same everything. So what are you paying the fee for? Apparently the bonus for using a BofA account for cash bank redemption is spiked to an eyebrow-raising 50%. So if you make $25 in rewards, BofA drops $37.50 into your account. There doesn't seem to be any limit on this (other than the aforementioned caps). The problem with all this is the $75 annual fee. At what point do you have to use the card to make the 50% benefit worthwhile? And does it compete with or trump other cards like Amex BCE/BCP?

    I calculate that if a family is spending $10,000 on groceries a year and $4000 on gas, if you use the BofA card exclusively for both, a user will tap out on 3%/2% cashback bonus 5 weeks into the quarter. That works out to $34 a quarter for 3%/2%, ignoring any 1% purchases, or $136 for the year. So you're already above the annual fee but then you throw in the additional 50% bonus for using BofA accounts which nets you a total of $204. Subtract $75 and you're back to $129 or savings.

    In the end, Amex BCE/BCP are still superior products since most people spend more on food than gas. For groceries only, BCE will still net you $180 a year at 3% versus $132 at 2% for BofA ($120+$12 bonus). And for the BCP, 6% cash back on groceries is still $360-$75(fee)=$285 versus just $120+$60(bonus)-$75(fee)=$105 for 2% groceries for BofA Privileges.

    If you just use BofA Cash Rewards as a gas card only, it looks better in that you get $180+$18(bonus)=$198 back a year (3% of $6000 capped) versus $120 doing the same for Amex BCE (2% of $6000 capped). Ironically, you lose money this way if you choose the BofA Privileges card since the $60 in bonus you'd get for gas and depositing in your BofA account is more than offset by the $75 fee. And we all know, there are better gas cards out there like PenFed Platinum (5% uncapped).

    In other words, for most people, an Amex BCE with no annual fee will beat a BankAmericard Privileges Cash Rewards with an annual fee.
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  2. #2
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    I have the BofA because they were easy to get and gave me good limits. I use that card after the middle of the month when the statement closes.

    The best two cards for if you want a gas/grocery combo are the BCP/BCE or the Penfed Platinum Rewards. The Platinum Rewards is a top 3 card on the market in my opinion.
    Gas: Discover It, Penfed Platinum Rewards x2, Chase freedom, Citi TYP
    Plane tickets: CSP
    Groceries: AMEX BCP, Penfed Platinum Rewards,Citi TYP
    Clothes: Express, Amex BCP, Discover IT
    Amazon: Citi Forward, Cash +
    Restaurants: Citi Forward, Chase Freedom, Discover IT, CSP
    Hotels and other travel: Discover Escape, CSP
    Movies: BofA travel rewards visa signature(fandango), Discover IT, Citi Forward, Freedom
    Bars, clubs, tomfoolery: CSP, Citi Forward, Discover IT, Freedom
    Balance transfers: Kroger 123 rewards
    Bill Pay: Chase Ink Plus, Citi Forward
    Everyday spending: Bofa Accelerated cash rewards amex, Discover Escape
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  3. #3
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    The BofA Cash Rewards works for me as I am not a huge spender. I am thankful that BofA offers 2% on groceries because last year Freedom was the only cashback card (besides AMEX) to offer a quarter; Discover offered a month. So far this year, it looks like Freedom isn't offering grocery stores for 2013. For me, I come very close to the combined $1,500 gas and groceries each quarter.

    As for gas...gas is a hot topic in the US...the banks like to offer high gas rewards because they know that despite the high prices of gas and this country's obsession with idiotic SUV's there are very few of us that will fully benefit from the gas bonuses. Unfortunately, a lot of unscrupulous individuals took advantage of the fact that they could buy gift cards at the grocery store and get 5% back-which is why most banks have stopped grocery store bonuses.....gas on the other hand usually has to be paid at the pump to get the full 5%and therefore, very few of us will even come close to the $1,500 quarter maximum and the banks know it. So they lure us in with the gas catagories.

    I also like that BofA will deposit my reward to ANY checking account electronically; though I do redeem mine to my BofA checking for the extra 10% They will also credit the account or send a check. AMEX and several other banks only credit the account with your reward. I personally like to have control of my reward to do with as I please rather than have it lost in next month's balance.

    This is why not all cards work for everybody. If your family eats a lot of food and drives a lot in their huge SUV, then yes, the BofA Cash Rewards or Cash Rewards Privileges isn't going to be for you. On the other hand, it works perfectly for people like me who don't give a hoot about 5% back on travel, home improvement, restaurants or my favourite, movies.....Freedom and Discover have become very irrelevant for my spending patterns. But they work perfectly for others.
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    So with the 50% bonus the BankAmericard Privileges with Cash Rewards card gives 3% on groceries and 4.5% on gas?
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    Apparently. The problem is that once you factor in the annual fee, that drops the benefit to no better than a standard BCE card for groceries (though it is a bit better for gas). If this card matched the Amex BCP product with 6%/3%/1%, then the 50% bonus would be a competition killer, even capped at $6000. Anyway, it's still not bad as a gas card, especially if you don't have a Penfed card, but the Penfed Platinum with 5% gas and no annual fee is still the king of the gas cards. But the BofA Cash Rewards card + BofA checking/savings account is a decent alternative.

    I made a mistake in the first post, final paragraph. The calculation for the Cash Rewards card for gas should be $120+12=$132, not $180+18=196.

    I estimate that the difference in my household of using it versus getting a Penfed is about $68 for the year (assuming a $4000 annual spend). Since I will be using my Chase Freedom for six months out of 2013 for gas anyway, that difference shrinks further.

    So I'll do the BofA Cash Rewards for Gas and Restaurants. I'll still apply for a Amex BCP for groceries. I doubt I'll spend the time getting a Penfed right now since I have alternatives and I have higher priorities for which cards I want for my family in 2013.
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    I agree, that BofA card needs to step up its game.

    Since my Sallie Mae card gives 5% on $250 of gas monthly I'm covered there. It also gives 5% on $250 of groceries monthly which I max out, but still nice.

    I move to Priceline for groceries when I reach the Sallie Mae cap. I could get 2.2% on the BofA Cash Rewards card with the bonus, but the 0.2% difference isn't worth carrying the card around.
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  7. #7
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    I think the BofA Cash Rewards is reasonably competitive matched with a BofA account. The problem is that the Privileges card sounds good on the surface until you begin adding up everything and realize that the 50% bonus isn't enough to erase the annual fee penalty given the caps on usage. If they went to a 6%/3%/1% model like Amex BCP, then it would instantly be a card to have.

    Since I already have the card, that reduces the incentive I need in order to save money by applying for something else right now. And my wife likes the idea of just having the money drop into our savings account versus waiting for a gift card in the mail.

    Lastly, my journey into credit cards is more quality than quantity. I'm not young anymore (middle aged) and have a long credit history. I can be strategic with what I need with prime cards so that my family's budget situation will be a lot better in 2 years taking advantage of the credit monster and not being a victim of it. The keys are having an action plan, budgetary discipline and a little luck with the lenders to get the cards I need.

    Right now here is my shopping list:

    High priority:
    One, maybe two 0% cards to burn down debt (Discover+ and/or Citi Diamond Preferred)
    Amex BCP card for groceries

    Medium priority:
    Second Amex BCP to maximize grocery benefit using the marriage multiplier
    Chase Sapphire Preferred (to maximize benefits from the Freedom I already have)

    Low priority:
    Penfed Platinum
    Any restaurant card
    Any utility card
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    Quote Originally Posted by Sevenfeet;34963Right now here is my shopping list:[/QUOTE

    High priority:
    One, maybe two 0% cards to burn down debt (Discover+ and/or Citi Diamond Preferred)
    Amex BCP card for groceries

    Medium priority:
    Second Amex BCP to maximize grocery benefit using the marriage multiplier
    Chase Sapphire Preferred (to maximize benefits from the Freedom I already have)

    Low priority:
    Penfed Platinum
    Any restaurant card
    Any utility card
    Not a bad list. I really think you should move the Penfed up in the rankings. Uncapped rewards on gas and groceries.
    Gas: Discover It, Penfed Platinum Rewards x2, Chase freedom, Citi TYP
    Plane tickets: CSP
    Groceries: AMEX BCP, Penfed Platinum Rewards,Citi TYP
    Clothes: Express, Amex BCP, Discover IT
    Amazon: Citi Forward, Cash +
    Restaurants: Citi Forward, Chase Freedom, Discover IT, CSP
    Hotels and other travel: Discover Escape, CSP
    Movies: BofA travel rewards visa signature(fandango), Discover IT, Citi Forward, Freedom
    Bars, clubs, tomfoolery: CSP, Citi Forward, Discover IT, Freedom
    Balance transfers: Kroger 123 rewards
    Bill Pay: Chase Ink Plus, Citi Forward
    Everyday spending: Bofa Accelerated cash rewards amex, Discover Escape
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  9. #9
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    I think you're right. I'd forgotten that Penfed Platinum is good for groceries at 3% as well. But even more important is that they also are offering 0% for 18months for balance transfers. That's killing two birds with one stone (well, three if you count gas). Using it for groceries would save me about $600 a year even without having the Amex BCP. That may make it one card to rule them all in my house. We also have our mortgage with another federal credit union, which can't hurt (and I wish the other one had a credit card like this).

    OK, then. Here's the new list:

    High priority:
    Penfed Platinum (Gas, 5%, Groceries 3%, both uncapped, 0% balance transfer)
    Second 0% card is Penfed doesn't give me the CL I need (Discover IT would be the card to get)

    Medium priority:
    Chase Sapphire Preferred (to maximize benefits from the Freedom I already have)
    Amex BCP to maximize grocery benefit

    Low priority:
    Any restaurant card (US Bank +)
    Any utility card (Barclays)
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  10. #10
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    Now you're cooking with gas. Let us know if we can help in any way. I'm happy to give referrals for apps too.
    Gas: Discover It, Penfed Platinum Rewards x2, Chase freedom, Citi TYP
    Plane tickets: CSP
    Groceries: AMEX BCP, Penfed Platinum Rewards,Citi TYP
    Clothes: Express, Amex BCP, Discover IT
    Amazon: Citi Forward, Cash +
    Restaurants: Citi Forward, Chase Freedom, Discover IT, CSP
    Hotels and other travel: Discover Escape, CSP
    Movies: BofA travel rewards visa signature(fandango), Discover IT, Citi Forward, Freedom
    Bars, clubs, tomfoolery: CSP, Citi Forward, Discover IT, Freedom
    Balance transfers: Kroger 123 rewards
    Bill Pay: Chase Ink Plus, Citi Forward
    Everyday spending: Bofa Accelerated cash rewards amex, Discover Escape
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