BankAmericard Travel Rewards® Credit Card Review: Great with Preferred Rewards Bonus

bofa_travelrewards191The BankAmericard Travel Rewards® Credit Card is the main “travel rewards” credit card branded by Bank of America. In this review, I’ll cover the card features but also focus on a lesser-known opportunity – if you’re a Preferred Rewards client, you can increase that bonus to 25% – 75%. For such “relationship” customers, the bonus can change this card from good to great. Read on for details.

Here are the highlights of this card:

  • Earn unlimited 1.5 points per $1 spent on all purchases, with no annual fee and no foreign transaction fees and your points don’t expire
  • 20,000 online bonus points if you make at least $1,000 in purchases in the first 90 days –  that can be a $200 statement credit toward travel purchases
  • Use your card to book your trip how and where you want – you’re not limited to specific websites with blackout dates or restrictions
  • Redeem points for a statement credit to pay for flights, hotels, vacation packages, cruises, rental cars, or baggage fees
  • Now with chip technology for enhanced security and protection at chip-enabled terminals
  • 0% Introductory APR for 12 billing cycles for purchases, then 15.24% – 23.24% Variable APR
  • Get an additional 10% customer points bonus on every purchase when you have an active Bank of America® checking or savings account
  • If you’re a Preferred Rewards client, you can increase that bonus to 25% – 75%. Click “Apply Now” to learn more about Preferred Rewards.

The Preferred Rewards program is designed to rewards clients with multiple account and higher assets located at Bank of America banking, Merrill Edge® online brokerage, and Merrill Lynch® investment accounts. Here is a partial table taken from their comparison chart:

bofa_pref1

Let’s consider the options. Bank of America’s interest rates on cash accounts tend to be lower than highest-available outside banks, so moving cash over to qualify may reduce your interest earnings. Merrill Lynch advisory accounts also usually come with management fees. However, if you have brokerage assets like mutual funds and ETFs, moving them over to Merrill Edge may actually reduce your costs because at the Platinum and Platinum Plus levels they will actually give you 30 to 100 free online stock trades every month.

I recently did a partial transfer of a little over $100k of brokerage assets (Vanguard funds) over to Merrill Edge to qualify for Platinum Honors. I should mention it may take a while for your “3-month average combined balance” to actually reach the $100k level and officially qualify for Platinum Honors. Only after that will the 75% rewards bonus on credit card rewards kick in.

(Side note: Stack this offer with their Merrill Edge brokerage sign-up bonus.)

Cash Back Rewards Tiers for Preferred Rewards

This card has a relatively simple rewards structure; you earn 1.5 points per dollar spent on all purchases. 1 point = 1 cent statement credit against any travel purchase made on the card (flights, hotels, vacation packages, cruises, rental cars, or baggage fees). As long you as you travel at least occasionally, I feel it is okay to value them at 1 cent per point, which means you could call this a “1.5% back on all purchases, if applied towards travel purchases” rewards card. Here’s how the bonuses then work out:

  • Platinum Honors: 2.625% back, if applied towards travel, or 2.625 points per dollar spent on any purchase (75% bonus).
  • Platinum: 2.25% back, if applied towards travel, or 2.25 points per dollar spent on any purchase (50% bonus).
  • Gold: 1.875% back, if applied towards travel, or 1.875 points per dollar spent on any purchase (25% bonus).

Note that the terms state “The Preferred Rewards bonus will replace the customer bonus you may already receive with the card.”, which I interpret to mean that you will lose the 10% bonus for redeeming your cash back into a Bank of America® checking or savings account.

(Update: Here are my redemption tips and experiences on qualifying for and receiving 2.625% back towards travel.)

Well, I think their plan is working because Bank of America has managed to convince me to go from only having a checking account with them to now also having a Merrill Edge brokerage account and a Bank of America credit card. I definitely realize not everyone will have this level of assets to move around, and so this is somewhat a restricted offer. But if you do then it is worth considering. Both Platinum and Platinum Honors levels allow you to reach tiers that effectively give you over 2% back on all purchases, with the important caveat that your rewards must offset previous travel purchases on the card.

Not all Bank of America consumer credit cards qualify for Preferred Rewards. Another card that does qualify is the BankAmericard Cash Rewards™ Credit Card. I picked this BankAmericard Travel Rewards Credit Card myself, but for other folks the grocery and gas bonuses specifically available on the BankAmericard Cash Rewards™ Credit Card might give you higher rewards.

“Disclaimer: This content is not provided or commissioned by the issuer. Opinions expressed here are author’s alone, not those of the issuer, and have not been reviewed, approved or otherwise endorsed by the issuer. This site may be compensated through the issuer’s Affiliate Program.  “The responses below are not provided or commissioned by the bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by the bank advertiser. It is not the bank advertiser’s responsibility to ensure all posts and/or questions are answered.”

Comments

  1. How do you like Merrill Edge? Did they refund transfer fees?

  2. The transfer went smoothly, it helped that I was basically assigned a single contact person for the on-boarding / asset transfer. I believe that Merrill Edge will reimburse your transfer fees with any transfer of $25k or greater, but I can’t seem to find the link right now. (+Bonus mentioned above.) I didn’t have to pay any fees anyway because it was only a partial transfer of assets and not the entire account. Many brokerages charge $0 for partial transfer, although of course you’d want to check to make sure.

    (Actually, I just checked and Vanguard doesn’t charge a fee even for a full outgoing transfer. That’s nice of Vanguard. Most places do.)

    Merrill Edge is fine so far. Interface is similar to other discount brokerages a la TradeKing, TD Ameritrade. If you have Bank of America checking accounts, it is nice that you can also see your ML Edge account info and your BofA credit card balance all with the single checking account login.

  3. So how much do they charge to keep an ETF account? I like Vanguard because it’s free and straightforward, and I just invest into VT and VTIP and just rebalnce it once a year (during a randomly predetermined day).

    Unless you’re a day trader I don’t see why anyone would need to trade 30 times, moreover 100 times a month, so this is kind of useless benefit. But of course I drank John Boggles’ Kool Aid so maybe other people nervously trade their ETFs back and forward each day or week.

    • No annual account fee. No minimum balance requirement. No annual custodial fee for IRAs. Partial outgoing transfer is free. There is a $49.95 fee for full outgoing transfers for taxable accounts, also a $49.95 for outgoing/closing out an IRA. Here’s a link to their account fee page:

      https://www.merrilledge.com/pricing#tab2

      I don’t plan to make very many trades either.

  4. I have this combination and it works great.

    Two further points to make:

    1. There is a “up to $1000” bonus promotion for Merrill Edge (until 12/15/15)
    https://www.merrilledge.com/offers/1000offer

    2. If you don’t travel much, you can move the rewards from the Travel Rewards card to the FIA/Fidelity AmEx card and then redeem it for cash into a Fido account.

  5. Great combo, been using for a year now. Also their cash back card is worth a look for gas/groceries combined with plat honors.

  6. Maybe I did not understand the offer clearly but is the advantage a maximum of 2.65% if redeemed for travel and lower if non-travel?
    Citi Double and Fidelity Amex gives standard 2% so if I don’t travel a lot would this still be a good deal?

    • You’d just need to have enough travel purchases on the card to offset your rewards balance. If you spend $10,000 in a year, 2.65% would be $265 in rewards if applied toward travel. 2% of $10,000 would be $200. 2.65% is technically then over a 30% improvement in rewards.

      In a couple of days, I’ll have my review up for an a different BofA rewards card which offers straight cash back and also participates in the Preferred Rewards program.

  7. My main question / concern when transfering brokerage assets is whether cost basis and dividend reinvestment histories transfer correctly from the previous firm? I’ve run into this issue before which makes me reluctant to chase offers unless it’s a retirement account,

    • Cost basis history was one of my concerns as well. I can confirm that all my tax lots transferred over to Merrill Edge correctly, even when I bought as little as one single share.

      My feeling is that after the recent tax law changes requires that brokers track cost basis for you, the back-ends of all brokerage firms are much better at this *if* they already have your cost basis on file. If you bought in 1967 and the tax lots don’t show up online at your original brokerage, I’d be wary. Here’s a quote from NYT regarding the new-ish cost basis laws:

      The good news is that if you decide to change brokers, they are now required to to send your cost basis data to the new firm within 13 days, according to Schwab, so long as they have that information. And many firms may already keep track of your basis, even if they are not required to send it to the I.R.S.

      http://www.nytimes.com/2013/03/16/your-money/new-tax-laws-cover-cost-basis-of-investments.html?_r=0

  8. I have a standard BoA rewards card that offers 1% on purchases, 2% on groceries, and 3% on gas (up to $1500 of those purchases per quarter). I get the Platinum Honors 75% bonus each month on my total rewards earned for a statement period. I then redeem those cash rewards into a BoA savings account. I’ve done the math and am 95% certain I get another 10% bonus on the already-augmented rewards amount each month because I redeem into that BoA account. In other words, I am fairly certain they automatically stack the 75% Platinum bonus with the 10% redeem-into-a-BoA-account bonus and I benefit from both. That may not be the case with this card, but if I signed up for this card I would expect it to be the same.
    YMMV.

  9. Do you still like it Jonathan

    • Yes, this card gives me an effective 2.625% back on everything and is thus my primary card, although I may put spending towards a sign-up bonus and/or a bonus category instead like 5% rotating or 3% towards restaurants.

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