Improved 60k offer. The Bank of America Premium Rewards Credit Card is the mid-tier premium card in the line-up, with added perks in exchange for an $95 annual fee. (Comparable with the Chase Sapphire Preferred and American Express Green cards.) This card also participates in the Preferred Rewards program, which gives you better rewards if you let BofA hold of your assets. Here are the highlights:
- Earn 60,000 bonus points ($600 value) after making $4,000 in purchases in first 90 days of account opening.
- Earn 2 points per dollar spent on travel and dining purchases.
- Earn 1.5 points for each dollar spent on all other purchases.
- 10% customer bonus 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%. See details below.
- Up to $100 annual airline incidental statement credit for qualifying travel purchases such as seat upgrades, baggage fees, in-flight services and airport lounge fees.
- Up to $100 airport security statement credit towards TSA Precheck or Global Entry Application fee, every four years.
- No foreign transaction fees.
- $95 annual fee.
- No limit to earning points, and points don’t expire.
Preferred Rewards bonus. 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 (click to enlarge):
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 result in earning less interest on your cash deposits. Merrill Lynch advisory accounts also usually come with management fees. The sweet spot is if you have brokerage assets like stocks, mutual funds, and ETFs.
In the past, moving over to Merrill Edge at the Platinum and Platinum Plus levels also led to 30 to 100 free online stock trades every month. Fast forward to now, and nearly all major online brokers offer commission-free trades anyway.
Personally, I moved over $100k of brokerage assets to Merrill Edge to qualify for Platinum Honors. This can include your existing ETFs and mutual funds held elsewhere (Vanguard, Fidelity, Schwab, etc). I realize not everyone will have this level of assets to move around, but if you do then it is worth considering. Keep in mind that it will take a while for your “3-month average combined balance” to actually reach the $100k level and officially qualify for Platinum Honors. You might become Gold first, then Platinum, and so on. After that, the 25%-75% rewards bonus on credit card rewards kick in.
Once you reach a certain tier, BofA guarantees that you will stay there for a year no matter what, even if your balance fluctuates. Note that the terms state “The Preferred Rewards bonus will replace the customer bonus”, which means that you will lose the 10% customer bonus when you qualify for the 25% to 50% bonus.
Here’s are the cash back rates after the Preferred Rewards bonuses:
- Platinum Honors (75% bonus): 3.5% cash back on travel and dining, 2.625% cash back on all other purchases.
- Platinum (50% bonus): 3% cash back on travel and dining, 2.25% cash back on all other purchases.
- Gold (25% bonus): 2.5% cash back on travel and dining, 1.875% cash back on all other purchases.
Rewards comparison. This card has a more flexible rewards structure than their BankAmericard Travel Rewards card in that the points don’t have to offset a travel purchase. You can redeem at a flat 1 point = 1 cent value towards a statement credit or deposit into eligible Bank of America or Merrill Lynch® accounts (including deposit, investment or 529 accounts).
Getting a flat 2.625% (Platinum Honors) or 2.25% cash back (Platinum) on all purchases is a very solid base earning level. In terms of the competition, there are now multiple cash back cards in the 2% cash back range such as the Citi Double Cash Card with no annual fee. That means I wouldn’t bother with this card for everyday purchases if I wasn’t Platinum or Platinum Honors.
Also note that you can also earn similar levels of everything rewards (minus the travel/dining bonus category) but restricted to offsetting a travel-related purchase with the BankAmericard Travel Rewards card – except with no annual fee. The question then reverts back to if you can offset that $95 annual fee with the $100 annual incidental airline credit good towards seat upgrades, baggage fees, in-flight services and airport lounge fees. (Sadly, everything seems to be an added fee these days.) If you can get max value out of that airline incidental credit every year, then that removes the major disadvantage when compared to the BofA Travel Rewards card. You can then enjoy the added perks like the $500 value sign-up bonus, $100 Global Entry/TSA PreCheck credit once every 4 years, and the higher rewards on travel/dining bonus.
Bottom line. The Bank of America Premium Rewards Credit Card is rather average in basic form, but is elevated into an excellent card if you can qualify for the Platinum or Platinum Honors tiers of their Preferred Rewards program for up to 3.5% cash back on travel and dining and 2.625% cash back on all other purchases. Note the the $95 annual fee is not waived for the first year. Consider your ability to use up the $100 annual incidental airline credit.
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To get the $1000 Merill bonus (your side note), I assume you apply for the card first, then use that link to transfer money in?
I don’t think it matters what promo you apply for first, they are two separate promotions for the credit card and Edge brokerage. You would have to keep your brokerage assets there long enough to qualify for the Preferred Rewards status.
I have shares in a mutual fund (Massachusetts Investors Trust) that I bought as a teenager. I have reinvested capital gains for nearly 50 years, and my position is worth about $80K now. I’ve never sold this fund principally because I don’t know my basis and don’t want to work that hard on taxes. I’ve forever kept them with MFS (the parent group) although they have repeatedly pestered me for the name of my “financial adviser.”
Question: Can I move this $80K dinosaur to BofA for purposes of the $100K “Platinum Honors” requirement? And if so–out of curiosity–what’s in it for BofA?
Honestly, I would just call up Merrill Edge and ask if it can be transferred over in-kind internally. If not, I’m still sure you could transfer it over as you can transfer holdings from any brokerage.
What’s in it for BofA? They want you have you in their ecosystem. If you do your banking, credit cards, mortgage, and brokerage accounts through BofA, they can cross-sell different products in the future.
My company has our 401k accounts with Merrill. Do you know if they qualify towards account minimums?
Employee benefit plans such as 401ks do not qualify towards Preferred Rewards (source)
$1k bonus offer expired on 12/31/16
Oops, thanks for pointing that out. The best alternative offer I could find is up to $600 or IRA and CMA accounts. I believe CMA just means a regular taxable brokerage account (with cash management features).
I’ve been waiting for this news for a while after seeing the initial WSJ article.The card seems weak.
Costco (no annual fee):
3% restaurants & travel
BOA Cash Rewards (no annual fee):
5.25% gas, 3.5% grocery & wholesale (Costco)
Rewards cap of $2.5k/quarter defeated with multiple cards.
BOA Travel Rewards (no annual fee):
2.625% on everything else
*** if you spend a ton on travel & dining then ***
BOA Premium Rewards ($95 annual fee):
3.5% restaurants & travel
Break even dining between Costco & BOA Premium Rewards = 95/0.005 = $19k.
Yes, that’s why I mention the $100 annual incidental airline credit. If you can take advantage of that, then this card effectively has no annual fee, and your break-even calculation is unnecessary.
When you call the card weak, you are not giving consideration to the sign up bonus and $100 airline credit. I like to check bags, so the $100 covers the the annual fee of me. That leaves a tax free $500 for me. However, since I am already at the 75% bonus level, this could mean a bonus of $875 tax free. On the cash rewards card I got the 75% on the basic sign up bonus. On the travel card I did not get the 75% on the basic sign up bonus. Does anyone know if the bonus levels will apply to the sign up bonus?
You don’t get the 75% bonus on the $500 sign up bonus.
How did you determine that you do not get 75% bonus?
can anyone confirm if you receive the 75% bonus on the $500 sign up bonus for Platinum Honors members?
Can you get Platinum Honors Level by bringing in $100K in IRA assets?
Yes, IRA assets count. Here’s a good breakdown of what types of assets count towards Preferred Rewards.
Here’s a working link for Merrill $1k:
https://www.merrilledge.com/offers/1000offer?src_cd=sfms17&cm_mmc=gwm-selfdirectedbrokerage-_-vanity-_-g201vn0021_moneyshow-_-na
Thanks! I will swap out the link. Weird that if you strip out the stuff at the end of the link, you get the expired offer.
Jonathan, I’m an active Vanguard investor, but I moved $110,000 to Merrill and signed up for the card. I’d like to invest in a portfolio generally the same as your target allotment. Can you recommend some of their funds that you probably researched when you made your investment? I noticed when I did a little research that the expense ratio for a lot of their holdings are more expensive than Vanguard.
I would simply recommend investing in Vanguard ETFs if possible. You can also transfer over Vanguard mutual funds “in-kind” and just keep them there, investing the dividends in Vanguard ETFs or moving them back to your Vanguard account.
I applied and received this card, transferred money to Merrill and opened a checking account with the intent of satisfying the Platinum Honors requirements. My first payment was recently due and I found it to be impossible to make a payment on their site using my non-BoA checking.
What every other company has made easy, BoA has made difficult. I think what you have to do is enable “Bill Pay” on your account, then verify any external account with small deposits, and then transfer funds from that account into the BoA checking, then pay the credit card from the BoA checking. Ridiculous.
When I called to ask about the process I learned from their automated system that I could make a payment by phone, which I attempted, but I made a mistake with my checking account number and the payment didn’t go through. Did they inform me that the payment was not made? Or contact me in any way? Nope. They just charged me a late fee and started charging interest.
I also purchased an upgrade on a flight this month and did not receive the $100 credit. I tried to call support to understand why and was transferred about 6 times before the call was finally disconnected.
No thanks. I don’t need a credit card that is a hassle to pay. Account closed. I’ll be closing the bank account too since the only reason I opened it was for the credit card. I’ll leave my funds at Merrill until I’m credited the bonus and likely close that too.
I’m very dissatisfied with my experience at Bank of America, so much so that I doubt I will ever open an account with them again.
I’ve had this card for close to year now and have a couple of questions:
1. Redeeming points for cash is the max value you can receive right? Or is there a higher value redemption option?
2. Annual fee of $95 is offset by the annual travel credit so as long as you can use it, it’s worth renewing. However if I’d like to get the 50k points bonus (assuming it continues to be offered in the future) as soon as possible, how long do I have to wait since my last bonus was earned and/or since I close my account?