[Originally published in 2014. Updated on August 23, 2023. Links are NOT affiliate links. We don’t get paid if you apply for any credit card.]
I have a brokerage account at Merrill Edge and a free checking account at Bank of America. I qualified for Bank of America’s Preferred Rewards program after three months. Then I added a Bank of America Travel Rewards card to the Preferred Rewards program.
75% Bonus from Preferred Rewards
On a stand-alone basis, this credit card isn’t that special. It gives 1.5% rewards on every purchase with no caps or special categories. It has no annual fee and no foreign transaction fee. There’s a small sign-up bonus. The Preferred Rewards program makes it much nicer.
When you enroll in Bank of America’s Preferred Rewards program, you get a boost in credit card rewards. $100k in assets held at Merrill Edge puts you in the Platinum Honor tier, which gives you a 75% bonus on credit card rewards. 1.5% rewards with no caps on everything at the base level then becomes 2.625% rewards on everything in the Platinum Honor tier.
For example, a $71.30 purchase earned 187 reward points worth $1.87. That’s 2.625%. You get the 75% bonus after you qualify for the Platinum Honor tier in Preferred Rewards. If your Bank of America checking account is new, it has to go through three month-ends before you qualify.
This Bank of America card with a 75% bonus gives more rewards than other 2%-rewards cards such as the Fidelity Visa or the Citi Double Cash card.
Hold ETFs at Merrill Edge
The best way to qualify for the Platinum Honor tier in the Preferred Rewards program is by transferring $100,000 worth of investments to Merrill Edge and linking the Merrill Edge accounts to the Bank of America checking account. The $100,000 doesn’t have to sit in cash. It can be stocks, bonds, mutual funds, or ETFs held in IRAs or regular brokerage accounts.
You don’t have to sell your investments and trigger capital gains when you transfer to Merrill Edge. Existing investments can be transferred “in kind.” Merrill Edge sometimes gives a bonus for your transfer. Google “Merrill Edge transfer bonus” for the current offer.
You don’t have to trade in the Merrill Edge accounts either if you prefer to use a different broker. Just holding $100,000 worth of an S&P 500 ETF in an IRA and setting up free automatic dividend reinvestment will do. Merrill Edge doesn’t charge maintenance or inactivity fees.
If you do use Merrill Edge to trade, Merrill Edge charges zero commission on online stock and ETF trades.
Redeem Against Past Travel and Dining Purchases
The reward points from the Travel Rewards card are worth the most when you redeem them as a statement credit against travel and dining purchases made in the previous 12 months (100 points = $1). As long as you charge some travel and dining expenses on this card once in a while, you have plenty of opportunities to redeem the points.
These charges all counted as travel in my account:
- Airlines (both tickets and baggage fees)
- Hotels
- Airbnb
- Car rentals
- Uber and Lyft
- Transit (train, bus, ferry)
- Parking and tolls
- Ski passes
Dining includes bars, restaurants, and fast food.
The minimum number of points for redemption is 2,500 points (earned by spending $952 at 2.625%). You have one year from the date of a travel or dining charge to redeem points against it. You can redeem points against the same charge multiple times until the charge is fully covered by points redemption.
Don’t Travel or Eat Out?
If you don’t travel or eat out and therefore will have difficulty finding travel and dining charges to redeem rewards against, Bank of America also offers an Unlimited Cash Rewards card. Everything works the same as the Travel Rewards card except that the rewards are given in cash and it has a 3% foreign transaction fee. The foreign transaction fee doesn’t matter much when you don’t travel.
| Unlimited Cash Rewards | Travel Rewards | |
|---|---|---|
| Annual Fee | None | None |
| Foreign Transaction Fee | 3% | None |
| Rewards on everything | 1.5% base 2.625% with 75% bonus | 1.5% base 2.625% with 75% bonus |
| Redeem rewards | Cashback | Statement credit against travel and dining charges in the last 12 months |
Travel or Eat Out a lot?
If you travel or eat out a lot, Bank of America also offers a Premium Rewards card that has an annual fee but gives higher rewards on travel and dining charges.
| Travel Rewards | Premium Rewards | |
|---|---|---|
| Annual Fee | None | $95 |
| Foreign Transaction Fee | None | None |
| Airline incidental statement credit | None | up to $100/year |
| TSA PreCheck or Global Entry fee credit | None | up to $100 every 4 years |
| Rewards on travel and dining charges | 1.5% base 2.625% with 75% bonus | 2% base 3.5% with 75% bonus |
| Rewards on everything else | 1.5% base 2.625% with 75% bonus | 1.5% base 2.625% with 75% bonus |
| Redeem rewards | Statement credit against travel and dining charges in the last 12 months | Cashback |
You’ll get more from the Premium Rewards card to offset the annual fee if you pay airline baggage fees or charge a good amount for travel and dining.
Pick One
The Travel Rewards card and its two sister cards work similarly. Which one works the best comes down to how much you travel and eat out.
- No travel or eat out => Unlimited Cash Rewards card
- Some travel and eat out => Travel Rewards card
- More travel and eat out => Premium Rewards card
Autopay Full Balance
It’s not obvious how you set up for automatically paying the full balance every month on Bank of America credit cards. Please follow the steps in Set Up Autopay On Bank of America Credit Card.
Free Credit Score
Bank of America offers monthly free FICO credit scores from TransUnion if you have a credit card from them.
***
I use the Bank of America Travel Rewards card for pretty much everything. It works to its full potential when you also have Merrill Edge and Bank of America accounts and you make it to the Platinum Honor tier in the Preferred Rewards program.
I like this card because it’s dead simple. There are no special categories to track and no confusing point transfers. I naturally have some travel and dining charges to redeem rewards against when I charge pretty much everything to this card. If you don’t travel or eat out much or if you travel and eat out a lot, a sister card from the same bank works better.
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KD says
I saw on other online forums that the average balance has to be over $100K for 3 months and the balance determination is done on the third of the month. So if you put in over $300K at the end of the month, then technically you should be able to sign up for preferred rewards and get the 75% bonus starting 3rd of the next month right?
Harry Sit says
Only if you already have a B of A checking account for more than 3 months and you link it with the new Merrill Edge account.
jc says
Why not just get the BofA cash reward which gets you 3% on gas, 2% on groceries and 1% on other, plus 75% bonus for Plat Honors, plus 10% customer bonus for redeeming into BofA checking/savings? So effective total back would be 5.77% on gas, 3.85% on groceries, and 1.92% on other if I am doing the math correctly. Are there any benefits to using points (or points converted to cash) to travel vs. getting more back in cash and then straight up buying the travel yourself?
Harry Sit says
The 75% bonus will replace the 10% bonus; you don’t get both. The gas and grocery categories have caps ($1,500 in purchases each quarter). If you want only one card, with 5.25% on gas and 3.5% on groceries subject to caps, and 1.75% on everything else, it may or may not come ahead of 2.625% on everything. Of course you can get both. Many people use two cards, one for special categories, and another for everything else.
jc says
Thanks for the response, I’m a big fan of your site and have learned much from your articles over the past few months. Anyway, I just got off a chat with a BofA rep and she confirmed that we are able to stack the 10% with the Platinum rewards (25%–75% depending on tier). That said, my new card was just sent out in the mail and I will have to do the math afterward to see if it really works. You are right that it depends on what you spend on that determines if you end up ahead. More than 50% of my card spending is on gas and food combined so it makes sense for me (and i am mindful of the $1500/qtr cap)
Edgar says
JC, I wonder if you have confirmed that the 10% for redeeming into a BOA account gets stacked with the 75% bonus for preferred rewards platinum honors as described to you by the BOA rep? Thanks.
jc says
Harry was right, no stacking. Platinum rewards program replaces older customer bonus. They added a footnote now to make it clear. Still not a bad deal. I use this card as my nongrocery (gas, etc) card and amex blue cash preferred for groceries. That way I avoid blowing thru the reward limits.
alcwj says
Would be nice to see how you like Merrill Edge brokerage account so far, been hearing too many horrible stories regarding their services.
BH says
Does this BofA card use the same processing company as the Fidelity AMEX – FIA Services? I have seen the really bad review for the FIA Services processing on the Fidelity AMEX….bad customer service, poor website design, lack of ability to pay in full, etc. I was surprised that AMEX would not handle the processing….instead, it appears they have outsourced it to FIA services.
Harry Sit says
Bank of America services it. The card shows up on bankofamerica.com, together with your B of A checking account. Don’t believe the bad reviews. There is never the lack of ability to pay in full. I gave the link in the article.
Bobson says
Long time FIA customer here. The reviews were valid in that FIA only recently (last year and a half or so) gave us the ability to autopay our balances in full.
Harry Sit says
You always had the ability to auto pay in full. Previously you had to call customer service to get a form in the mail which you fill out and return. Later they added a button that links to the online form but many mistakenly thought the button was an ad.
Daddy Warbucks says
Also long time FIA card customer – and have had full autopay for so long I have no recollection of how that was done.
My problem is that FIA’s fraud detection algorithms are set on hair-trigger. They routinely deny me routine online transactions, and once, I had them decline my card *at the grocery store where I shop EVERY SINGLE WEEK* . as a result, I have had my card # changed 4 times now (by them – I never get a choice in the matter), which is a pain in the ***.
has anyone else experienced that level of frustration with FIA and the card being recommended here? I was sold until I saw it was FIA – am getting ready to dump that one.
Harry Sit says
Daddy Warbucks – I’m not sure which FIA card gave you trouble. I never had any decline problems, not with this card since I started using it not too long ago, nor with Fidelity Visa which I used for several years. They replaced Fidelity Visa a couple of times due to merchant breaches. I imagine I would still have my card replaced if I used a different card at the merchant anyway.
washerdreyer says
Really interesting post, something to keep in mind next time I’m looking for a bank promo and/or a credit card, which is pretty frequently. On a sort of related topic, are you still making a 3.0% reward checking account work for you? My wife and I each had one, and then recently some rule changes combined with merchant code changes have made them much more difficult to maintain.
Harry Sit says
I closed that one. I don’t want to track whether I used it on 4 transactions over $50 yet. I had to keep the account open with $200/month deposit until it aged past 12 months; otherwise they charge you $10 to close it. Disappointed by that credit union.
Troutfisher says
I have the Fidelity AMEX. The interest on the B of A checking account is .05 of 1 percent, likewise their Money Market. Banking at Everbank, I get .45 of 1 percent on checking and .61% on a Money Market. No costs of any kind. So, switching to Bank of America costs some money although I could just set up an account with the required minimum balance and never use it … but then I do have to set up a Merrill account and fund it. I would be nice to just transfer checking and money market … but that would cost too much in lost interest.
Harry Sit says
I agree this is not for you if you are not willing to open a Merrill Edge account.
Sam R says
The bank staff who helped me open a checking account said I would get a FREE small safe deposit box rental (worth $47/yr), when one has 50k balance in merrill or BofA.
Did you take advantage of this?
Harry Sit says
Not yet. I heard horror stories if you don’t visit your box often some states force the banks to treat it as abandoned and send the content to the state. I don’t know if it’s true. I sure don’t want it to be less safe than at home.
Sam R says
For getting this Visa, I almost didn’t get the $100 signing bonus.
I went to BofA bank branch & applied for the Visa with a Merrill rep in the bank branch, after he helped me open a Merrill Edge account.
The next week, that person quit work! He no longer works at Merrill.
The Visa’s customer service on the phone said I wouldn’t get the signing bonus, because the application was not done online.
What???
The Merrill Edge rep that helped me apply for the Visa didn’t inform that signing bonus is only given for application done online.
So I had to talk to & convince the bank branch manager to honor the bonus.
Oh, BofA!
Sam S says
Hi Harry,
Want to know your response to these 2 questions:
1)Can you tell if BOA travel rewards visa signature reports the credit limit to agencies? I’m planning to convert from better balance visa to travel rewards visa if it reports the same way?
If the signature version doesnt report the CL, is there a Platinum Plus version of the card?
2) Planning to roll over prior 401K to Merryl Lynch to take advantage of the Platinum Honors status. How are the funds availability in ML, does it have Vanguard ETF, low expense funds and service?
Appreciate your help
Harry Sit says
1) Don’t know. I haven’t checked my credit report since I got the card. 2) It’s a brokerage account. All mainstream Vanguard ETFs should be available, but of course I didn’t check every single one. Vanguard mutual funds cost $20 per trade. Some readers reported that certain non-Vanguard ETFs weren’t available. QVAL, USO, UNG were mentioned.
Anthony says
When redeeming points on the BoA Travel Rewards Visa, is the structure similar to the old platinum rewards card? Can you redeem points for cash? Does 50,000 points still get you $500.
Harry Sit says
Don’t know anything about the old platinum rewards card. On this card, you can redeem for cash, as opposed to a statement credit against a previous travel charge, but you don’t get the full value if you want cash.
B says
May be a silly question, but I assume you can withdraw whatever funds you deposited to qualify for this card and you still qualify to earn at the highest level (2.6%) indefinitely, correct?
Harry Sit says
Not correct. If you fail to maintain the status you will lose the bonus and fall back to 1.5%.
Casey says
I’ve talked to BoA about this, and it sounds great. I have already opened my IRA with them and am in the process of funding it with a transfer from one of my Vanguard accounts.
Can you please say what steps the other requirements, such as opening the checking account and credit card, should be done in?
Thanks!
Harry Sit says
You can open the checking account online or in a branch. After it’s opened link your Merrill Edge account to it. The credit card has a signup bonus only if you open it online; don’t open it in a branch.
TJ says
Apparently if you book travel through the Bank Of America travel portal, there is a stacking point bonus which brings it closer to 4% cashback ?
Harry Sit says
The travel portal is operated by Orbitz. Booking through a third party can create a finger-pointing problem if you ever have to make a change or if there is any problem with your reservation. I used it once. I don’t find the extra 1.5 points worthwhile.
Bull says
with PH, you also get 4.125% on the first $6000 of travel purchased from the BOA travel center. This beats the Amex PRG’s 3x redeemed at cash rates (.0125 with Schwab) and the Prestige’s 3x redeemed at .0125 for any flight. There are some crazy cash deals on flights that make airline points worth less than 1 cent per point so UR and MR are worth nothing to me. In several examples I see flights from Europe -> US for less than $450 roundtrip.
Craig says
Old article, so I assume this wasn’t true at the time, but now Bank of America has the Ultimate Rewards card which also has no annual fee and earns 1.5% (up to 2.625% with Premium Rewards) on all purchases. The rewards are just cash so you don’t have to bother redeeming against travel purchases.
Harry Sit says
If you meant the Unlimited Cash Rewards card, it has a 3% foreign transaction fee. The Travel Rewards card doesn’t have a foreign transaction fee. I’ve never run out of travel charges to redeem rewards against. The Unlimited Cash Rewards card works better if someone doesn’t travel (and by definition won’t have foreign transactions).
Craig says
Yes, sorry, BofA Unlimited Cash Rewards. Too similar to Chase Ultimate Rewards…
Harry Sit says
I added a new section for the Unlimited Cash Rewards card. The three cards create a good spectrum for people who don’t travel, travel some, or travel a lot.
DB says
Thanks for updating the post Harry. In addition to travel expenses, I have found that dining/restaurant purchases can also be used to redeem travel rewards points.
Harry Sit says
You’re right! I added dining to the eligible purchases for rewards redemption.
TJ says
That must have been a covid addition that stuck. I don’t recall having that option when this post was originally created. I think I closed my Travel Rewards card – I have Premium, and 3 CCRs
Harry Sit says
The Premium card pays 2% base also on dining now.
TJ says
I meant the option to redeem points for restaurant purchases on the Travel card.
RH says
I have not tried it myself, yet, but the fine print on Preferred program seems to indicate if one is new client to BoA you can get qualified for tier based on initial funding within 30 days of acct opening rather than having to wait 3 months:
“ You can satisfy the combined balance requirement for enrollment with either:
– a three-month combined average daily balance in your qualifying deposit and investment accounts, or
– a current combined balance, provided that you enroll at the time you open your first eligible personal checking account and satisfy the balance requirement at the end of at least one day within 30 days of opening that account.” (Current @ Oct 15/23)
Harry Sit says
Mentally prepare to qualify in three months but be pleasantly surprised if you qualify after one month.
RH says
Hi – qualifying faster than 3 months is possible, I did it in less than a week. Opened new BoA/Merrill accounts and funded money to Merrill from elsewhere, and I was Platinum Honors before the new credit card even arrived by mail.
The kicker is this is only doable for new BoA checking customers. When you sign up for the checking account you get option to enroll early, they describe as follows in application: “Enroll Early in Preferred Rewards: Early enrollment is available when you open your first checking account with us and have $20,000 or more in combined balances within 30 days of opening your account.” This Early Enrollment box is pre-checked (yes) by default in the application, so an applicant would have to take action to mess it up.
Also: regardless of travel or dining spend expectations, the more generous signup bonus currently offered for Premium vs Travel card makes it worth anybody that can throw $4,000 spend towards it in first 90 days from card opening to do Premium. At $350 extra value ($600 vs $250), the breakeven is ~3.5 years of Premium’s $95 annual fee before it would have been cheaper to do Travel card, never mind all that bonus earn on Travel/Dining categories over that time frame. Could always downgrade at year 3 mark and come out ahead.
PJ says
With current Money Market rates at 5% plus another option is to park 100k plus in one of the available funds at Merrill to attain 75% Preferred Rewards status. https://olui2.fs.ml.com/Publish/Content/application/pdf/GWMOL/ICCRateSheet.pdf
RH says
I didn’t see it mentioned above but, aligned with Harry’s “set it and forget it” autopay mantra, you can elect an automatic redemption of BoA points to be deposited as cash to BoA/Merrill accounts at the end of each month. (Only caveat is cannot set this up to be a statement credit to card, which is an additional option if you do a manual redemption.)
RH says
ok, one other caveat, you have to have min 2,500 pts for it to auto-pay (around $1000 in monthly spend @ Platinum, assuming 2.625%), otherwise it would just roll forward until you hit 2,500 and then get disbursed in a later month-end .
Harry Sit says
The Premium Rewards card and the Customized Cash Rewards card have a setting to automatically deposit rewards (minimum 2,500 points as you noted). The Travel Rewards card doesn’t auto-deposit because you get the highest value by matching against past travel or dining charges. It’s easy to redeem manually either on the website or in the B of A app.
Joe says
After reading about the credit card benefits at Bank of America in your “My Financial Toolbox” book, both my wife and I applied online for their Customized Cash Rewards credit card and were not approved. I also tried to apply one for one of their checking accounts and again was not approved — they said I could try again at one of their branches, but the nearest branch is about an hour’s drive. We both have excellent or very good credit scores. We have one credit card that we pay in full each month and no other loans. The only reason I can think of for the denial is that we have not been BoA customers before, but I don’t see how we can easily fix that.
Harry Sit says
If your credit and ChexSystems weren’t frozen when you applied, you probably ran into a problem with ID verification. They suggested that you try again at their branch where you can present your ID. You can call the branch to see if they’ll take an image of your ID because the branch is too far.
Craig says
My spouse and I had multiple BofA credit cards for years when we applied for a joint checking account to get Premium Rewards and were also denied online. Luckily we are close to branches and had no problem in person.
RH says
@Joe – you could also try checking you and your spouse’s ChexSystems reports for free at
https://www.chexsystems.com/request-reports/consumer-disclosure (or google “Request ChexSystems Consumer Disclosure Report”)
Chex says “If you have been denied an account and ChexSystems was used in the decision process, this information will help you understand what may have contributed to that decision.”
Joe says
Thanks for the suggestions. The closest BoA branch said they cannot review IDs remotely to help open a checking account. I ordered my ChexSystems report – not available to deliver online now, so it’s being mailed.