The Bank of America® Cash Rewards credit card is a decent cash back card, but it really stands out for people who have Bank of America accounts. The credit card itself provides a solid cash back rewards rate across several categories, including rare ones like drug stores and furniture stores. Below, we highlight some more pros and cons for this card and compare it to other similar cards that you may wish to look at.
Bank of America® Cash Rewards credit card Review: An Excellent Cash Back Card for Bank of America Members
Our Thoughts on the Bank of America® Cash Rewards credit card
A simple, no-frills cash rewards card—the Bank of America® Cash Rewards credit card has No Annual Fee annual fee and is great for everyday purchases. The card has a 3%/2%/1% reward tier structure that allows you to choose a category for the 3% back.
|3% Cash Back Categories|
|Drug Store||Home Improvement/Furnishings|
Despite being only able to choose one category, which you can change month to month, the wide range of available categories makes this a great card for rare cash back opportunities at drug stores or home improvement stores. Another feature on this card is a typical $200 signup bonus after making at least $1,000 in purchases in the first 90 days of your account opening. However, if you have a Bank of America Preferred Rewards account, you can earn 25% - 75% more cash back on every purchase.
Where the Card Could do Better
Although you can choose a category for 3% cash back and you get 2% cash back at grocery stores and wholesale clubs, they are capped at a combined $2,500 every quarter. So if you spend $2,000 on online shopping for your 3% category and $500 at grocery stores, for the rest of the quarter you would only get a below average 1% cash back on any other purchases while online shopping or at grocery stores.
Overall, this card is excellent for people whose accounts qualify for the Platinum or Platinum Honors tier of Preferred Rewards, or above average if you want to use the 3% cashback on the niche categories.
How Does the Bank of America® Cash Rewards credit card Compare to Other Cards?
While the Bank of America® Cash Rewards credit card is an excellent card for Bank of America customers, that doesn't mean this card can't be good for people who don't bank with Bank of America. Below, we provide some comparisons against other popular cashback credit cards.
Our Thoughts on the Chase Freedom Unlimited®
These cards are very similar in their features, but the better card will largely depend on your spending and which bank/credit cards you use. The Chase Freedom Unlimited® lets you Earn 5% cash back on travel purchased through Chase, 3% on dining and drugstores, and 1.5% on all other purchases.
People who want a hassle-free cash back experience, high balances with Bank of America, or the ability to get high rewards rate on rare categories like drug stores or home improvement stores are better off using the Bank of America® Cash Rewards credit card. Those who dine out and travel often, and prefer a high rate of unlimited cash back on everything else or have the Chase Sapphire Preferred® Card or Chase Sapphire Reserve® would be better off using the Chase Freedom Unlimited®.
If you have high balances on your Bank of America accounts you get a multiplier effect on your cash back rewards rate. On the other hand, if you have the Chase Sapphire Preferred® Card or Chase Sapphire Reserve®, the Chase Freedom Unlimited® has a very good rewards rate on any purchase. This is because the Chase Sapphire Preferred® Card provides 25% more value when redeeming the points for travel on the Chase portal. Similarly, the Chase Sapphire Reserve® provides 50% more value. However, this means the cash back rewards are only valuable when using them through the Chase portal for travel, limiting how you would like to use your rewards.
Our Thoughts on the Capital One® Quicksilver® Cash Rewards Credit Card
As another unlimited 1.5% Cash Back on every purchase, every day with $0 annual fee, the Capital One® Quicksilver® Cash Rewards Credit Card is a standard cash back card and a good alternative to the Bank of America® Cash Rewards credit card if you don't want to deal with the hassle of tracking which categories you should use the credit card for. Otherwise, the Bank of America® Cash Rewards credit card is better if you spend the time to optimize your spending or have high balances across your Bank of America accounts.
Other features include no foreign transaction fees and an introductory 0% APR for 15 months, which can make this a great card to use when traveling. Most cash back credit cards that don't have an annual fee have foreign transaction fees and a shorter introductory 0% APR period if they even have one.
Our Thoughts on the Discover it® Cash Back
The Discover it® Cash Back is a rotating category cash back card that provides Earn 5% cash back on everyday purchases at different places each quarter like Amazon.com, grocery stores, restaurants, gas stations and when you pay using PayPal, up to the quarterly maximum when you activate. Plus, earn unlimited 1% cash back on all other purchases – automatically. Although the $1,500 is lower than the $2,500 limit on the Bank of America® Cash Rewards credit card, the higher rewards rate means you still get $75 worth of cash back in a quarter if you manage to spend $1,500 in the category. For 2020, the categories include grocery stores, Walgreens and CVS (January-March), gas stations, Uber, Lyft and wholesale clubs (April-June), restaurants and PayPal (July-September), Amazon.com, Target and Walmart.com (October-December). This means trading flexibility for a higher rewards rate. The signup bonus is unique for the Discover it® Cash Back—the bonus doubles any cash back you earned at the end of your first year.
The Bank of America® Cash Rewards credit card is the better choice if you want the flexibility to choose your category every month. This flexibility may be better for you over the course of the year because the rotating categories chosen for you may not fit your spending habits, resulting in the lack of rewards for the card.
For rates and fees of the Discover it® Cash Back, please click here.
Interested in other types of rewards credit cards? Read Best Rewards Credit Cards for Savvy Cardholders.