Do you have a Bank of America credit card or are you considering getting one? Excellent choice! Understanding how Bank of America rewards work can unlock a world of benefits, from significant savings to exciting travel opportunities. It's not just about spending; it's about spending smartly and letting your purchases work for you. This comprehensive guide will walk you through everything you need to know, from earning to redeeming, and how to supercharge your rewards with their unique Preferred Rewards program.
Demystifying Bank of America Rewards: Your Ultimate Guide
Bank of America offers a variety of credit cards, each with its own reward structure, typically focusing on cash back or travel points. The true magic, however, often lies in combining your credit card rewards with Bank of America's Preferred Rewards program. This loyalty program amplifies your earnings simply by maintaining certain balances across your Bank of America banking and Merrill investment accounts.
Let's dive into the step-by-step process of understanding and maximizing your Bank of America rewards.
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| How Do Bank Of America Rewards Work |
Step 1: Identifying Your Bank of America Rewards Card
The very first step in understanding "how Bank of America rewards work" is to know which Bank of America rewards card you have (or are planning to get). Each card has a distinct earning structure.
Sub-heading: Popular Bank of America Rewards Card Types
- Bank of America® Customized Cash Rewards Credit Card: This card is a favorite for its flexibility. You earn a higher cash back rate in a category of your choice, which you can change monthly.
- Typical Earning: 3% cash back in your chosen category (on up to $2,500 in combined choice category/grocery/wholesale club purchases each quarter), 2% at grocery stores and wholesale clubs, and 1% on all other purchases. New cardholders may even get boosted rates for the first year!
- Bank of America® Unlimited Cash Rewards Credit Card: If simplicity is your game, this card offers a straightforward flat rate on all purchases.
- Typical Earning: Unlimited 1.5% cash back on all purchases. Again, new cardholders might see a temporary boost to 2% for the first year.
- Bank of America® Travel Rewards Credit Card: Designed for travelers, this card earns points that can be redeemed for travel and dining statement credits.
- Typical Earning: Unlimited 1.5 points for every $1 spent on all purchases. Points don't expire as long as your account is open, and there are no foreign transaction fees.
- Bank of America® Premium Rewards® Credit Card: This is a higher-tier card offering enhanced rewards on dining and travel, along with a travel credit and other perks.
- Typical Earning: 2 points for every $1 spent on dining and travel, and 1.5 points per $1 on all other purchases.
Action Item: Take a moment to check your credit card statement or log into your Bank of America online banking to confirm which card you hold and its specific reward structure. This is crucial!
Step 2: Earning Your Rewards
Once you know your card, the next step is to understand how to earn those valuable rewards. It's generally straightforward: use your card for everyday purchases!
QuickTip: Focus more on the ‘how’ than the ‘what’.
Sub-heading: Understanding Earning Rates and Categories
- Cash Back Cards:
- For the Customized Cash Rewards card, remember to select your preferred 3% cash back category each month if you want to optimize your earnings. Categories often include gas, online shopping, dining, travel, drug stores, and home improvement. If you don't select a category, it typically defaults to the last one chosen.
- The Unlimited Cash Rewards card simplifies things by giving you the same rate on everything.
- Travel Rewards Cards:
- With the Travel Rewards card, every purchase earns you points at a flat rate.
- The Premium Rewards card incentivizes spending on dining and travel, so if those are large parts of your budget, focus your spending there.
- Bonus Offers: Many Bank of America credit cards come with generous welcome bonuses for new cardholders after meeting a specific spending requirement within a certain timeframe (e.g., spend $1,000 in the first 90 days to earn a $200 bonus). Always pay attention to these initial spending requirements as they can significantly jumpstart your rewards balance.
- Preferred Rewards Boost: This is where Bank of America truly stands out! If you are a Preferred Rewards member (which we'll discuss in detail in Step 3), you'll earn a bonus on your credit card rewards. This means your 1.5% cash back could become 1.875%, 2.25%, or even 2.625%, depending on your tier!
Key Tip: Always use your Bank of America card for eligible purchases to maximize your earning potential. Be mindful of any quarterly spending caps on bonus categories, especially with the Customized Cash Rewards card.
Step 3: Unlocking the Power of Bank of America Preferred Rewards
This is the game-changer for Bank of America customers. The Preferred Rewards program is a loyalty program that rewards you for your overall relationship with Bank of America and Merrill (their investment arm). By maintaining certain combined balances in your eligible Bank of America deposit accounts and/or Merrill investment accounts, you can qualify for different tiers and unlock significant bonuses on your credit card rewards, along with other banking perks.
Sub-heading: Preferred Rewards Tiers and Benefits
There are several tiers, each offering increasing benefits:
- Gold Tier:
- Required Balance: $20,000 - $49,999 (3-month combined average daily balance)
- Credit Card Rewards Bonus: 25% bonus on eligible Bank of America credit cards.
- Other Benefits: Waived fees on select banking services, interest rate boosters on savings accounts, and discounts on auto and home equity loans.
- Platinum Tier:
- Required Balance: $50,000 - $99,999 (3-month combined average daily balance)
- Credit Card Rewards Bonus: 50% bonus on eligible Bank of America credit cards.
- Other Benefits: Enhanced banking fee waivers, higher savings interest rate boosters, and larger loan discounts.
- Platinum Honors Tier:
- Required Balance: $100,000 - $999,999 (3-month combined average daily balance)
- Credit Card Rewards Bonus: 75% bonus on eligible Bank of America credit cards.
- Other Benefits: The highest level of credit card reward bonuses, unlimited no-fee ATM transactions, foreign currency exchange rate discounts, and more substantial loan discounts.
- Diamond Tier:
- Required Balance: $1,000,000 - $9,999,999
- Credit Card Rewards Bonus: 75% bonus.
- Other Benefits: Many of the Platinum Honors benefits, plus additional exclusive perks.
- Diamond Honors Tier:
- Required Balance: $10,000,000 or more
- Credit Card Rewards Bonus: 75% bonus.
- Other Benefits: Top-tier benefits, including exclusive access and premium offers.
How the Bonus Works: The percentage bonus is applied after your initial rewards are calculated. So, if you earn 1.5 points per dollar on a travel card and are in the Platinum Honors tier (75% bonus), you'll effectively earn points per dollar. This can significantly increase your earning power!
Sub-heading: Enrolling in Preferred Rewards
- Eligibility: To enroll, you need an active, eligible personal checking account with Bank of America and must meet the balance requirements for one of the tiers.
- Enrollment: You can typically enroll in Preferred Rewards through your Bank of America online banking portal. It's usually a quick and easy process.
- Maintaining Your Tier: Your balances are reviewed monthly. If your balances increase and qualify you for a higher tier, you'll be automatically upgraded. Even if your balances temporarily dip below your current tier's threshold, you'll generally maintain your benefits for a full 12 months, offering a grace period.
Crucial Insight: If you have significant assets spread across different banks or investment firms, consolidating them with Bank of America and Merrill could unlock substantial rewards and benefits through the Preferred Rewards program.
Tip: Share one insight from this post with a friend.
Step 4: Redeeming Your Rewards
Earning rewards is great, but redeeming them is where you truly benefit! Bank of America offers various redemption options, depending on your card type.
Sub-heading: Redemption Options for Cash Back Rewards
For cards like the Customized Cash Rewards and Unlimited Cash Rewards:
- Cash Back Deposit: This is the most popular option. You can deposit your cash back directly into your Bank of America checking or savings account. This is essentially free money!
- Statement Credit: You can apply your cash back as a statement credit to reduce your credit card balance.
- Automatic Redemption: Many cards offer the option to set up automatic redemption once your cash back reaches a certain threshold (e.g., $25). This is a hassle-free way to ensure you never leave rewards on the table.
Sub-heading: Redemption Options for Travel Rewards
For cards like the Travel Rewards and Premium Rewards:
- Statement Credit for Travel and Dining: You can redeem your points for a statement credit to cover eligible travel and dining purchases made on your card. This is highly flexible as you can book travel through any provider (airline, hotel, car rental, etc.) and then simply "erase" the expense with your points. Dining purchases are also often eligible.
- Cash Back: While less common for travel cards, you might have the option to redeem points for cash back, though the value per point might be lower than for travel redemptions.
- Gift Cards: Some cards may offer gift card redemption options, but again, the value per point might not be as optimal as travel or cash back.
Sub-heading: How to Redeem Your Rewards
- Online Banking: The easiest way to redeem is by logging into your Bank of America online banking account. Navigate to your credit card, and you should see a "Rewards" or "Redeem Rewards" tab.
- Mobile Banking App: The Bank of America mobile app also provides a convenient way to view and redeem your rewards. Look for a "Rewards" section or similar.
- By Phone: You can also call the customer service number on the back of your card to redeem your rewards.
Important Note: Always check the minimum redemption amounts. For cash back, it's often $25. For travel statement credits, it might vary, but typically points are worth $0.01 per point (10,000 points = $100).
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Step 5: Maximizing Your Bank of America Rewards
Now that you understand the mechanics, let's talk strategy!
Tip: Each paragraph has one main idea — find it.
Sub-heading: Strategic Spending
- Match Spending to Card Categories: If you have the Customized Cash Rewards card, actively manage your chosen category to align with your highest spending areas for that month. Are you planning a big home improvement project? Set your category to home improvement.
- Leverage Preferred Rewards: This cannot be stressed enough. If you have the means, maintaining higher balances with Bank of America and Merrill will significantly boost your credit card rewards, making your everyday spending much more valuable.
- Utilize Welcome Bonuses: If you're applying for a new card, prioritize meeting the spending requirement for the welcome bonus. These bonuses offer a quick and substantial influx of rewards.
- Pair Cards: Consider having both a cash back and a travel rewards card if it fits your spending habits. For instance, use your Customized Cash Rewards for your chosen bonus category and grocery, and your Travel Rewards for everything else if you prefer points.
Sub-heading: Avoiding Common Pitfalls
- Don't Overspend for Rewards: Only spend what you can comfortably afford to pay off each month. The interest accrued from carrying a balance will quickly negate any rewards earned.
- Understand Spending Caps: Be aware of any quarterly or annual spending caps on bonus categories. Once you hit the cap, your earning rate usually drops to 1%.
- Monitor Expiration Dates: While most Bank of America rewards don't expire as long as your account is open and in good standing, it's always wise to periodically check your rewards balance and understand any terms.
- Keep Accounts in Good Standing: Rewards can be forfeited if your account is past due, closed, or not in good standing.
Step 6: Staying Informed and Managing Your Rewards
Bank of America provides tools to help you keep track of your rewards.
Sub-heading: Online Banking and Mobile App Features
- Rewards Summary: Both the online banking portal and mobile app offer a clear summary of your current rewards balance.
- Transaction History: You can typically see which transactions earned you rewards and at what rate.
- Preferred Rewards Dashboard: If you're a Preferred Rewards member, you'll have a dedicated section showing your tier, eligible balances, and the benefits you're receiving.
- Alerts: Set up alerts to notify you when your rewards balance reaches a certain amount or when new offers become available.
Proactive Approach: Regularly review your rewards balance and consider your redemption options to ensure you're getting the most out of your Bank of America rewards program.
Frequently Asked Questions (FAQs)
Here are 10 common questions about Bank of America rewards, with quick answers:
How to check my Bank of America rewards balance?
You can check your Bank of America rewards balance by logging into your Bank of America online banking account or through the Bank of America Mobile Banking app. Navigate to your credit card details, and you'll typically find a "Rewards" or "Redeem Rewards" tab.
How to redeem Bank of America cash back rewards?
To redeem cash back rewards, log into online banking or the mobile app, select your credit card, and choose to deposit the cash back into a Bank of America checking/savings account or apply it as a statement credit to your credit card balance.
Tip: Don’t skim — absorb.
How to redeem Bank of America travel rewards points?
Bank of America travel rewards points are typically redeemed as a statement credit to offset eligible travel and dining purchases made on your card. You can do this through online banking or the mobile app.
How to qualify for Bank of America Preferred Rewards?
You qualify for Bank of America Preferred Rewards by having an active, eligible personal checking account with Bank of America and maintaining a combined average daily balance of at least $20,000 across your eligible Bank of America deposit accounts and/or Merrill investment accounts.
How to change my Bank of America Customized Cash Rewards category?
You can change your chosen 3% cash back category for the Bank of America Customized Cash Rewards credit card once a calendar month by logging into your online banking account or using the mobile app.
How to maximize my Bank of America rewards?
Maximize your rewards by strategically using your credit card for purchases that align with bonus categories, enrolling in and achieving a higher tier within the Preferred Rewards program, and taking advantage of new cardholder welcome bonuses.
How to ensure my Bank of America rewards don't expire?
For most Bank of America credit cards, your rewards (cash back or points) do not expire as long as your credit card account remains open and in good standing.
How to contact Bank of America customer service for rewards questions?
You can contact Bank of America credit card customer service by calling the number on the back of your card, or by finding contact information on the Bank of America website or mobile app.
How to enroll in Bank of America Preferred Rewards?
You can generally enroll in the Bank of America Preferred Rewards program through your Bank of America online banking portal if you meet the eligibility criteria (active checking account and minimum combined balances).
How to understand the value of my Bank of America points?
For the Bank of America Travel Rewards card, points are generally worth $0.01 per point when redeemed for travel or dining statement credits (e.g., 10,000 points = $100). For cash back cards, $1 in cash back is equivalent to $1.
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