Schwab Invest First Visa: Get In Before The Door Closes

I have been using the Schwab Invest First Visa credit card for several months now. It replaces the Fidelity Investment Rewards Visa I used before.

Both cards are issued by FIA Card Services, a subsidiary of Bank of America. The Schwab card pays 2% cash back to a Schwab brokerage account. The Fidelity Visa card pays 2% cash back only after you spend $15,000 in a year (1.5% cash back for the first $15,000). Fidelity also has a 2% cash back card — Fidelity Rewards American Express Card — which is also issued by FIA. More merchants accept Visa than American Express cards.

2% cash back is on everything. No tiers. No special categories. It can’t be any simpler. You also get ShopSafe, the one-time credit card number generator. ShopSafe is not available for the Fidelity American Express card.

FIA offers Bill Pay Choice. This card can be used to pay mortgage and bills from credit cards issued by other banks except Bank of America. You don’t earn cash back for Bill Pay Choice charges. You do get float and bill consolidation.

Automatic debit to a bank account for the full statement balance requires a phone call to customer service for a paper enrollment form. Once it’s set up, it works perfectly. No late fees, guaranteed.

Cash rebates are automatically deposited to a linked Schwab brokerage account every month. No manual request is required. There are no minimum balance or minimum activities requirements for the Schwab brokerage account. You can link a bank account to the Schwab brokerage account and transfer the rebate money to the linked bank account after the rebate is paid.

Schwab Invest First Visa credit card wins the TFB Award 2009 for Best General Purpose Credit Card. Fidelity Rewards American Express Card comes to a close second. Wider merchant acceptance, automatic rebate deposit, and one-time card numbers put the Schwab Visa card ahead.

There is speculation that Schwab may lower the cash back but they may grandfather existing cardholders. If that’s true and you’d like to get in before they change the program, act fast.

To apply for Schwab Visa, use online application or call 866-724-9223. Some applications require a phone interview. For Fidelity American Express, apply online or call 866-598-4971.

FIA, Schwab, or Fidelity don’t pay me in any way if you apply for a card.

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Comments

  1. Matt says

    I’ve been tempted by this card for a while. What holds me back is a desire for simplicity in my finances. I managed most of my money through my Fidelity mySmart cash account (thanks for the tip on that account, TFB!) and it is so convenient to have the cash back from the Fidelity Investment Rewards VISA deposited directly into my account. I went with the VISA card instead of the AMEX for the same simplicity reasons – VISA is basically accepted everywhere, therefore I can put ALL my monthly bills on it.

    Also, if you do the math, the cash back difference between 2% on all purchases and 1.5% on purchases up to $15,000/yr, then 2% after is a MAX of $75 per year. $75 is not enough for me to open and maintain another account.

  2. TFB says

    Matt – I hear you. I usually don’t chase these things either. For someone who doesn’t have any of these cards or the Fidelity mySmart Cash account, they might as well start with Schwab. Schwab also has the competing product to Fidelity mySmart Cash. It’s called Schwab Bank High Yield Investor Checking. It basically works the same way as mySmart Cash: no fees, all ATM surcharges are reimbursed. It pays 0.75% right now, versus 0.20% in mySmart Cash.

  3. Matt says

    TFB – Yep, I hear that, too. Would be a great setup for someone who doesn’t have all their linked accounts, credit card autopays, etc. already setup in one place.

  4. KD says

    Unfortunately, there bill pay doesn’t have my small credit union in their payee list. But its ok. I have asked them to add it using the add merchant tool. Lets see if they add it.

  5. TFB says

    KD – Thanks for bringing it to my attention. That’s strange. In IE 7, there are no numbers, just bullet points. In IE 8, everything is 1. The html source says (ordered list) but IE refuses to do it.

  6. Stu says

    I’m a credit card guru.

    There is one card that is superior today, especially if you travel by plane a few times a year.

    It is the Citibank Platinum Amex. For at least the first 2 years you get 5% ThankYou Points for grocery, gas and drug store purchases and 2-3% on everything else. The card also includes Citi Identity Monitor (track your credit scores and warns of ID theft) and 3 passes to airline clubs through Premier Pass Program. When I signed up, the card cost $85 per year(first year free), but they gave me around 20,000 thank you points which is equal to $200. There are two ways to get thankyou points to equal their max value. Order airfare through them (orbitz search engine on their site) or there are still a few gift cards where they offer 10,000 points for $100. Sears, Gap and JCPenny come to mind right now. The airfare option is great because if the flight goes for $100, you only get charged the 10,000 points and the frequent flier miles accrue. There are no black outs, no set point amounts for a reward and no airline limitation. Whatever the flight goes for, you pay with points at 1 for 1.

    I’m not sure what they are offering now, but nothing has been as lucrative for me as this card.

  7. Stu says

    Not quite as strong as it used to be, but I think the 3% is is still stronger than the Schwab 2%.

    Save $330 with waived fees for PriorityPassTM airport lounge access & Citi® IdentityMonitor®2.

    Earn 15,000 bonus ThankYou® Points after $300 in purchases1

    * Earn 3 ThankYou Points for every $1 spent on purchases at supermarkets, drugstores and gas stations1 for 24 months3
    * Earn 2 ThankYou Points for every $1 spent on all other purchases3
    * Access to concierge services for travel recommendations & reservations
    * Complimentary Domestic Airline Companion Ticket2

    https://www.citicards.com/cards/wv/cardDetail.do?screenID=927

  8. TFB says

    Stu – That’s why I qualified the Schwab card as the best general purpose card. When it comes to redeeming rewards, nothing beats cash for its flexibility. You don’t have to wait for a threshold. You don’t have to shop at specific places. After the signup bonus pays for the annual fee for a few years, do you cancel or do you start paying the annual fee? By that time, the 1% extra on supermarkets, drugstores and gas stations categories also drops off. Assuming both programs don’t change, the Schwab card has better long-term value. For people who are willing to play the signup bonus game, the Citi AmEx card is fine. For people who seek simplicity, it’s hard to beat the Schwab card.

  9. Stu says

    I don’t disagree with your thinking. I do get four years out of the promotion though by having my wife sign up for the card after the initial two years and then becoming an authorized user on her card. Admittedly, I plan to cancel the card after the 5% return is eliminated. Many times in the past, when I have called to cancel similar cards, they have extended the benefit.

    The Schwab Card is pretty cool in its simplicity, but until the 5% cards end, I think the extra effort is well worth it.

  10. nickel says

    Curious if the Schwab brokerage account pays interest (or has that option — maybe through a money market fund?). Also, is there a minimum balance? I’ve been mulling this card over for a long time now, but it looks like it might be time to jump on it before it goes away.

  11. TFB says

    nickel – The Schwab brokerage account pays 0.01%. Because there is no minimum balance or minimum activity, you can just link a bank account and transfer away the rebates monthly or whenever the amount becomes worthwhile. If you’d like to invest the rebates, the Schwab index funds are super cheap with a low initial investment of $100 and $1 for subsequent investments. It beats Sharebuilder and other small online brokers for investing small amounts because there’s no fee for each investment.

  12. Ningchuan Zhu says

    I’m a current cardholder and would like to add another reason why this card is a good deal: they only charge (or rather pass on) the 1% currency conversion fee levied by Visa, NOT the additional 2% that most banks charge. In all my overseas travel, I’ve found that – IF you’re paying 1% instead of 3% – using the credit card almost always gets you a better rate than going to change kiosks or local banks or using travelers checks (forget airport kiosks or one of those buy-foreign-currency-before-you-go services). The savings can be significant, particularly given how weak the dollar is these days.

  13. Linda says

    One feature of the Schwab Invest First Card, as well as Schwab debit cards, that has been overlooked is the price protection feature. Fidelity does not offer this feature because it is just a gold card. Price protection allows one to purchase locally and the coverage will pay the price difference if the cardholder finds a cheaper price. We have saved hundreds of dollars in less than 1 year.

  14. Stu says

    Ugh. Citi did not extend the promotion so now I am on to the Amex Blue Cash card. After the initial $6500, I’m back to the 5% back. Luckily, this one doesn’t expire.

    I do like the international conversion at 1% on the Schwab card. I suppose, I’ll use the Schwab card for all purchases except for Grocery, Gas and Pharmacy once I hit $6500 on my Amex.

    Excellent advice as usual here.

  15. SDer says

    So I need to open a brokerage account with them.. but I have no idea how to invest or anything. Do I have to have any money in this account or can I just have the cashback sit here until I transfer it to my local credit union account? Thanks so much.

  16. TFB says

    SDer – The brokerage account does not require any minimum balance or minimum activity. You can just have the cashback sit here until you transfer it to your local credit union account.

  17. SDer says

    Thanks TFB, so basically no fees or even maintenance activity (like making a trade) is required, correct?

    I am also looking into the Fidelity one (AMEX) because I already have a Fidelity account, do you think the Schwab is a lot better than the Fidelity one? You seem to know a lot.

  18. ALC says

    Hi, Just wanted to say a big THANK YOU for keeping your links to the Schwab Invest First Visa appplication current. I was thinking about this card for several months, I finally decided to apply, but many links on other websites are not working. It may mean the end is near for this great offer. I just applied using the links on this site and it said I was accepted, Hope they do not stop the 2% cash back before I get the card!

  19. Cour says

    I spoke to my contact at the local Schwab office today. He said they will cease to accept applications for this Visa on March 31. That motivated me to apply and the csr on the phone confirmed this date.

    This is a great website, my favorite of all the financial blogs.. I like the ‘low-signal-to-noise’ approach of fewer articles of higher quality.

    I regularly click on the google ads & follow them through a click or two..

  20. Ari Weinberg says

    Looks like this card transfers back to FIA Card Services at the end of the month…good bye 2% and 0% international fees!

  21. Stuart Weissman says

    Wow…shouldn’t be long before the Amex Blue Cash Rewards card gets decimated. I’m already finding that less and less business are taking AMEX these days. Even the Seatlle Transit does not take it.

  22. the_big_dave says

    I wonder why ShopSafe is not available for the Amex card? Is ShopSafe for Visa and MasterCard only???

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