Bank of America® Cash Rewards Credit Card Review
December 19, 2019
Get rewarded with the Bank of America Cash Rewards credit card
With a $200 bonus offer plus 3% cash back in your chosen spending category, in addition to 2% cash back at grocery stores and 1% cash back everywhere else, the Bank of America® Cash Rewards Credit Card should be a strong contender for a place in most wallets.
What to expect from the Bank of America Cash Rewards credit card
- APR: Introductory 0% APR for the first 15 billing cycles on purchases and balance transfers made within 60 days of opening the account, then 15.74-25.74% variable APR.
- Annual Fee: $0
- Reward Rates: Earn 3% cash back your choice of categories, 2% cash back on grocery store and wholesale club purchases and 1% cash back on all other purchases.
- Intro Offer: Bank of America rewards $1,000 or more in spending within the first 90 days of owning the card with a $200 online cash reward.
- Cash back won’t expire as long as the account remains open, meaning you can redeem your rewards whenever it is most convenient for you.
- Low minimum rewards redemption of $25 means you don’t have to wait ages until you can cash out.
- Automatic redemption to a Bank of America account makes getting rewards simple.
- Bank of America rewards are transferrable to the Preferred Rewards program where you can earn 25%, 50% or 75% rewards bonuses based on your Bank of America and Merrill Investment account balances. As your balances grow, so do your rewards.
But keep your eyes open for pitfalls
While the Bank of America Cash Rewards credit card offers a decent rewards rate, potential users should be aware that there is a $2,500 spending limit on the bonus category and the grocery store and wholesale club category rewards each quarter.
So, after spending a combined $2,500 in the bonus category of your choice and at grocery stores and wholesale clubs, you’ll no longer be eligible for a 3% and 2% rewards rate. This limits your total rewards in this category to $75 per quarter. After reaching the $2,500 combined limit, you’ll receive 1% cash back on all purchases made with the card.
The 0% introductory APR is only good for balance transfers and purchases made during the first 60 days of opening the account. All subsequent balance transfers and purchases made with the card carry a variable 15.74-25.74% APR. After 15 months, the 0% introductory APR on your initial balance transfers and purchases goes up to 15.74-25.74% APR.
How to maximize your Bank of America Cash Rewards credit card rewards
There is a $1,000 spending requirement to get the $200 bonus offer for new Bank of America Cash Rewards credit card holders within 90 days of opening the account. So, to secure the bonus, you’ll need to make an average of $334 per month in new charges with the card.
The Bank of America Cash Rewards credit card’s strength is in its 3% bonus on your chosen category. You have six options, including home improvement & furnishings, online shopping, travel, gas, dining and drug stores. Since you can change your category once each month, it may be helpful to think about any major purchases you plan to make during the month ahead and set your 3% rewards rate to cover that category of spending.
For example, if you plan to buy new couches for your living room and replace your mattress, set your 3% bonus category to furnishings through the Bank of America app or by logging into your account online. If you plan to do a lot of online shopping around the holidays, set your bonus category appropriately and watch the rewards roll in. Are you planning a big trip for spring break? Remember to set your bonus category to travel before you make reservations and order tickets.
Your monthly statement shows the merchant code for each purchase. Use this information to help you understand where your spending falls inside each of the six available categories. You can also find this information under the Spending & Budgeting section of the Bank of America app.
To maximize rewards for all purchases you make throughout each quarter, consider combining the Bank of America Cash Rewards credit card with another simple rewards card. For example, the Citi Double Cash Card offers 1% on all purchases + 1% when you pay the bill on those purchases for a total rewards rate of 2% on all purchases. Like the Bank of America Cash Rewards credit card, the Citi Double Cash Card does not have an annual fee. Unlike the Bank of America Cash Rewards credit card, the Citi Double Cash Card does not impose rewards limits.
Combining the use of two rewards cards, including one without a spending limit, may be especially suited to credit card users who want a simple rewards program and spend more than an average of $800 per month with cards.
Remember, it’s crucial to pay off balances each month to avoid paying interest charges since both the Bank of America Cash Rewards credit card and the Citi Double Cash Card charge higher-than-average interest rates on purchases. Bank of America Cash Rewards card offers 0% APR on purchases made within 60 days of opening the account, so you’ll have some leeway with interest with this card. With the Citi card, you’ll pay interest on purchases if you decide to carry a balance, which could negate any rewards benefits. Also, you’ll receive half of the rewards on purchases with the Citi card when you pay the bill. Keeping the balance at zero will help you maximize rewards on both cards.
The Bank of America Cash Rewards credit card is a solid option for an easy-to-use rewards card. However, there are better cards that you could use instead of, or in combination with, the BOA option.
For those who spend about $800 per month with their credit card, the Bank of America Cash Rewards credit card is a great choice for maximizing rewards. Those who spend less or want to combine the Bank of America Cash Rewards credit card with another straightforward rewards card should look at the Citi Double Cash Card.