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If I told you that there was a credit card offering a reduction of 6% on one of the six categories of current expenses, including restaurants and travel, do you think that is one of the Best money backing cards Consider applying for this summer? As a credit card expert that has covered this subject for years, I would.
The American Bank Personalized cash rewards The credit card is the latest addition to the list of the best Rewards credit cards, thanks to a new offer. During their first year, new card holders can earn 6% on purchases in a category of expenditure of their choice from six available options.
What is the catch? A few warnings make this card less lucrative than it seems, and it may not be the right card for everyone. Here’s what you need to know.
Everything you need to know about the new offer
Bank of America’s personalized cash awards now earn a double money back in a category of your choice for the first year. This means 6% money back in the choice category instead of 3% money back on the first $ 2,500 (in combined purchases each quarter in the choice category, and in grocery stores and wholesale clubs, then win 1% later).
There is no end date for this offer for new card holders. You can choose one of these options to be your choice category:
- Journey
- Dining
- Pharmacies
- Home and furniture improvement
- Gas and electric vehicle recharge stations
- Online purchases (including cable, internet, telephone plans, streaming)
You can change your category once a month via online or mobile banking services. If you do not change it, your selection from the previous month will continue. You will also win 2% in grocery stores and wholesale clubs, and 1% return to all other purchases.
There is a combined quarterly expenses of $ 2,500 for bonus awards in the choice category and 2% of the categories, after which you will gain 1% on these purchases. In addition to the increased first -year money delivery prices, new card holders can earn a welcome bonus of $ 200 after spending $ 1,000 in purchases during the first 90 days after the credit card is opened.
This new offer seems really strong …
To understand why the new offer of personalized cash awards is so good, you must understand the Silver backing landscape.
Flat rate cardsLike the active cash flow card of Wells Fargo, tends to offer 2% on all purchases. Several level reward cards, such as the American Express Blue Cash Everyday® card, generally offer 3 to 5% in some fixed categories and 1% on everything else. Rotating reward cards, such as Chase Freedom Flex, generally offer 5% on one or two rotary categories, up to a quarterly maximum, which changes throughout the year at the discretion of the transmitter, and 1% of everything else.
With this new offer, personalized cash awards offer 6% in your choice category (plus 2% in grocery stores and wholesale clubs) for the first year. Most importantly, you can choose your 6% category and modify it once a month.
This means both higher awards and more flexibility than most competitors. The quarterly expenditure ceiling limits awards beyond a certain point, but it is relatively common among non-annual money backing cards with high category bonuses.
Although maximizing the awards requires careful planning (more on this subject later), this new offer makes personalized species one of the best cards for all those whose highest categories of expenditure change throughout the year.
… But there are warnings.
Before leaving on this new credit card offer, be sure to consider these warnings.
Bonus awards are only for the first year with a spending ceiling
The greatest weakness of personalized cash awards is the $ 2,500 quarterly expenditure ceiling on the choice and 2%categories, limiting the awards for major expenditure. (To be clear, big expenditure can always make great use of this card for their first $ 2,500 in spending. They will just want to use a different card afterwards.)
The second issue is that after the first year, the reward rates come back to the basic line:
- 3% money back on the choice category
- 2% in grocery stores or wholesale clubs
- 1% money back on all other types of purchases
Although this is still a competitive reward rate for a Card without annexThey will not be at the top of the range for certain categories of choice.
You have to spend time spending carefully to maximize the rewards
One important thing to note is that the quarterly personalized cash rewards ceiling is shared between the 3% and 2% categories, and is calculated on the basis of the chronological order of your transactions, so that inappropriate time can reduce your rewards. With the rate of category of choice of 3% increased to 6% for the first year, the difference is even more striking.
For example, let’s say that this quarter you plan to spend $ 1,000 in grocery store each month, plus an additional $ 1,000 for online purchases (your choice category) at the end of the quarter. If you use your card as usual, invoicing the $ 3,000 of grocery store throughout the three months and finally the $ 1,000 in online purchases, that is what your rewards would look like:
Reward examples
indefinite
| Expenses | Reward rate | Rewards won | |
| Grocery store of the month 1 | $ 1,000 | 2% | $ 20 |
| Month 2 grocery store | $ 1,000 | 2% | $ 20 |
| Month 3 grocery store | $ 1,000 | 2% on the first $ 500, then 1% after reaching $ 2,500 in quarterly ceiling | $ 15 |
| Online purchases | $ 1,000 | 1% (would be 6% if the quarterly ceiling was not already reached) | $ 10 |
| Total | $ 65 |
On the other hand, if you first purchase online purchase, you would have won $ 105, because you would have benefited from the reward rate of 6% on this purchase before these grocery purchases eat your quota of quarterly expenses. A difference of a few tens of dollars is not the end of the world, but with additional planning, you can maximize the rewards with personalized money.
Does the first year double the cash register with the favorite award program?
THE Bank of America Preferred Rewards The program offers up to a 75% bonus on its credit card awards for eligible customers who maintain a certain balance in a bank account in Bank of America or Merrill. The favorite award bonus will apply to the rate of reduction in the 3% basic choice category, but not to the 3% of the first year bonus, according to a representative of the Bank of America.
Thus, a person at the highest level of the favorite award program could potentially earn a total of 8.25% money back on their purchase purchases in the first year, subject to the quarterly expenditure ceiling: 5.25% among the basic rewards and an additional 3% compared to the bonus of the first year.
Don’t forget not to spend too much to win awards
Several choice category options – as journey,, Online purchasesAnd the improvement of the house and the furniture – lend themselves well to big purchases. If you are already planning to make these types of purchases (and you have budgeted), this card is an excellent option to gain additional money back on these expenses. But do not let the rewards push you to make purchases that you would not have otherwise, or those which are out of your budget.
While this card has a 0% introductory after Offer for 15 billing cycles on purchases and balance transfers (18.24% to 28.24% after variable thereafter), it is still not an intelligent idea of taking credit card debt for discretionary expenses. The 6% silver delivery may seem like many awards, but it is far from the interests that you will pay by paying a balance of months to the regular APR.
Should you get the personalized cash card with the new offer?
As an expert in credit card, I would not hesitate to recommend this card to readers as well as my friends whose needs and expenditure habits correspond to his profile. You should probably recover this card if all the following elements apply to you:
- You spend a lot in one or more categories of choice.
- You want a new money backing card and do not already have personalized money.
- Your quarterly expenses in the choice and 2% categories are less than $ 2,500 or you go to a different card once you have hit this ceiling.
That said, it’s not for everyone, including myself. Personally Prefer travel rewards Of my faithful Favorite card by Chase Sapphire On money rewards, because I appreciate the flexibility of transferable points more than a higher basic reward rate. If you are in the same camp, consider a dedicated travel card instead.
If you do not spend much in any of the choice categories, you will be better with another card that rewards you where you spend the most. Although this card offers 2% in grocery stores and wholesale clubs, there are more Reward cards for grocery store. And if you spend a lot and only want to use a card for everything, a Unlimited 2% Silver Card Maybe your best option.
