Guide to the Bank of America® Cash Rewards Credit Card

If you are a fan of credit cards with simple cash back rewards programs, the Bank of America® Cash Rewards credit card should be on your radar. While cash back cards such as the Citi® Double Cash Card, Blue Cash Everyday® Card from American Express and Chase Freedom Unlimited garner most of the attention, this flexible rewards card has much to offer to cardholders who simply want to earn a lot of cash back on their everyday purchases.

The card features 3% cash back on a category of your choice and 2% back on grocery purchases, for up to $2,500 in combined purchases each quarter. Plus, it offers a bonus to Bank of America customers that can push the rewards rate over the top if you have enough cash in the bank.

A past poll by CreditCards.com found that 3% cash back is a favorite perk among rewards card users.

Bank of America® Cash Rewards credit card

Why should you get it? The Bank of America® Cash Rewards Credit Card offers 3% cash back on a category of the user’s choice, adding increased flexibility to the rewards program. It also offers 2% cash back on grocery and wholesale club purchases, making it a good card for everyday purchases.

More things to know: No annual fee $200 sign-up bonus if you spend $1,000 in first 90 days 3% cash back on a category of choice (gas, online shopping, dining, travel, drugstores or home improvements and furnishings) 2% cash back at grocery stores and wholesale clubs $2,500 limit in combined purchases every quarter on 2% and 3% categories (1% thereafter) 1% cash back on other purchases No rotating categories to keep track of

Why get the Bank of America Cash Rewards card?

For a no-annual-fee credit card, the Bank of America Cash Rewards card offers some pretty generous terms. Here’s a summary of some of its best features:

Good rewards on a category of choice and supermarket purchases with a high cap

The Bank of America Cash Rewards card isn’t the most generous card for supermarket purchases (that title goes to the Blue Cash Preferred® Card from American Express), but it does offer one of the best rates on supermarket purchases in the no-annual-fee category. In addition, it offers cardholders the added flexibility of choosing their own 3% bonus category. Users have options such as gas, online shopping and travel in order to maximize rewards throughout the year compared to many rotating category cards. Even better, these choice categories can be swapped out every month, making them more versatile than traditional quarterly bonus categories. The Cash Rewards card also has a high spending cap. While most gas and grocery cards limit the bonus to $1,500 in purchases per quarter, the Bank of America Cash Rewards card gives you a $2,500 quarterly spending cap in combined choice category/grocery store/wholesale club purchases (then 1% cash back).

Large sign-up bonus

The card also comes with a pretty generous bonus for a no-annual-fee card – you get $200 for signing up and spending $1,000 on the card in the first 90 days. Additionally, you can receive a 0% intro APR for balance transfers (within the first 60 days) and purchases lasting 15 billing cycles (then 13.99% to 23.99% variable). A balance transfer fee of 3% (minimum $10) applies.

Simple rewards redemption

The Bank of America Cash Rewards card makes it fairly easy to redeem your rewards. Since your rewards don’t expire, you can redeem your cash back at your leisure. Just log in to your account and redeem your cash at any amount for statement credits, Bank of America checking or savings account direct deposits or credit to an eligible Merrill account. However, you’ll need to have reached a $25 redemption minimum for automatic Bank of America account direct deposits or a qualifying Merrill 529 account.

Preferred Rewards bonus

The feature that really sets the Bank America Cash Rewards card apart from other cash back cards is an added bonus for Bank of America customers. If you have $20,000 or more in a qualifying Bank of America, Merrill account, you can register for the Preferred Rewards program and boost your rewards rate. Depending on your Preferred Rewards status, you could boost your earning rate by up to 75% on all purchases.

Bank of America Preferred Rewards tiers

Preferred Rewards tier	Rewards boost	Choice category cash back rate	Grocery store/wholesale club cash back rate	Other
Not a Preferred Rewards member	None	3%	2%	1%
Gold	25%	3.75%	2.5%	1.25%
Platinum	50%	4.5%	3%	1.5%
Platinum Honors	75%	5.25%	3.5%	1.75%

How to maximize the Bank of America Cash Rewards card

• Use the card for all your choice category, grocery store and wholesale store purchases, to earn bonus cash back.
• Hit the gas station (or another category of choice) before you go to the grocery store. You can easily max out the $2,500 spending cap each quarter, so make sure you earn cash back on the most valuable category of spend first.
• Rotate your card with a card that offers a bonus on other categories of purchases or with a flat-rate card that offers more than 1% back on every purchase. For instance, you can use the Citi Double Cash card – which earns up to 2% cash back on every purchase (1% when you make a purchase and another 1% when you pay your statement on time) – to pay for items that don’t fall under the bonus categories.
• Enroll in the Preferred Rewards program if you qualify, and redeem your rewards into a Bank of America account to earn bonus cash back.
• Visit the BankAmeriDeals website to earn additional cash back on your purchases. Note, you have to activate deals before you make your purchase, but Bank of America allows you to find and activate deals on the spot through its mobile app.
• Stack your cash back with a grocery store rewards program or a gas rewards program such as the Fuel Rewards Network. You can earn extra cash back on your purchases on top of the cash back that you earn from the Bank of America Cash Rewards card.

Selecting a 3%cash back bonus category

The Bank of America Cash Rewards card’s 3% bonus category, also referred to as the “choice category,” is automatically set to gas. However, card members can change the category one time each calendar month through online banking or using the mobile banking app.

To update the category in the mobile app, simply select the Bank of America Cash Reward card, click on the “Rewards” tab and select “Get Started.” If you want to choose a category other than gas, such as dining, click “Change Category.”

 

 

To get detailed information about each choice category, select “Category Details.” You can also view your previous choice categories by clicking “Selection History.”

 

Keep in mind that you don’t have to change the choice category every month, or at all in fact. It will remain the same until you decide to update it.

How much can you earn?

Cash Rewards cardholders will earn a 2% bonus on grocery store and wholesale club purchases and a 3% bonus on choice categories on up to $2,500 in combined purchases each quarter. Once the cap has been reached, cardholders will earn 1% cash back for the remainder of that quarter. All other purchases earn unlimited 1% cash back. But by maxing out your choice category each quarter, how much cash back can you really make?

So, for example, if you travel frequently and spend around $250 each week on hotel stays and rental cars, you’ll likely benefit most from the travel category. If you select the travel category for one quarter, you can easily max out the $2,500 bonus earning cap and receive $75 cash back.

Cash back earned on $2,500 quarterly spend in choice category

($2,500 travel spend x 3% cash back) = $75 cash back

If you only maxed out the 3% bonus category each quarter for a year, you could potentially earn $300 cash back for that year. Combine that with the $200 sign-up bonus after $1,000 spend in the first 90 days of account opening, and you can earn at least $500 cash back in the first year alone.

First-year cash back ($2,500 quarterly spend in choice category + sign-up bonus)

($2,500 travel spend x 3% cash back) x 4 quarters + $200 sign-up bonus = $500 cash back

What purchases qualify for a cash back bonus?

Every purchase you make using your card is categorized using a merchant category code (MCC). Merchants are assigned an MCC based on the products and services they offer. While Bank of America does not have control over how a merchant classifies itself, they do group similar MCC’s into grocery store, wholes club and choice categories to help maximize your bonus.

See what purchases qualify for bonus spend categories below.

Grocery store and wholesale clubs category

Grocery store merchants and wholesale clubs include supermarkets, freezer or meat lockers, candy, nut or confection stores, dairy product stores and bakeries. Superstores and smaller stores that sell groceries, such as drugstores and convenience stores, do not earn the bonus rate.

Gas category

The gas rewards category includes gas and fuel merchants whose primary line of business is the sale of automotive gasoline that can be purchased inside the service station or at the automated fuel pump as well as gasoline purchased at boat marinas. Fuel dealers whose primary line of business is the sale of heating oil, propane, kerosene and other fuels are also included.

Online shopping category

If you’re always filling out your digital wishlist, the Cash Rewards card is actually one of the best credit cards for online shopping on the market thanks to its wide merchant coverage. The online shopping category consists of online and mobile app purchases made at a variety of retailers, such as bookstores, department stores, specialty retailers and sporting goods stores. Not only are the common online retailer sites like Amazon.com, Bestbuy.com, Walmart.com and Target.com covered, but you’ll also rake in rewards from websites like Ticketmaster.com, QVC.com, Americanairlines.com, Starbucks.com, Uber.com, Groupon.com and even Etsy.com.

Merchants that provide non-retail services but allow you to pay online, such as doctors and hospitals, government services and taxes, insurance, membership organizations, schools and utilities are excluded from the category.

Dining category

The dining rewards category includes eating places, restaurants, fast food restaurants, eligible delivery services, bars, cocktail lounges, discothèques, nightclubs, taverns and drinking places. For example, McDonald’s, Starbucks, The Cheesecake Factory, Domino’s Pizza and Grubhub all fall under this category.

Travel category

A variety of purchases – ranging from everyday travel expenses to vacations and getaways – qualify for the travel rewards category. Merchants include, but are not limited to, parking lots and garages, tolls, taxis and ride-shares, commuter passenger travel, tourist attractions and exhibits, airlines, amusement parks, cruise lines, hotels and car rentals.

For example, Delta Air Lines, Airbnb, E-ZPass, Sunpass, Uber, Marriott. Enterprise Rent-A-Car, Amtrak and Expedia are considered qualifying merchants.

Drugstores category

The drugstores category includes purchases made at drugstores, pharmacies, drug proprietors and druggist sundries, such as CVS Caremark, RiteAid, Walgreens and Duane Reade.

Home improvement/furnishings

Merchants that qualify for the home improvement/furnishings rewards category include hardware stores, contractors, air conditioning and refrigeration repair shops, antique shops, carpet and upholstery cleaning services, lawn and garden supply stores, paint stores, household appliance stores, miscellaneous house furnishings specialty shops and more.

For example, Ace Hardware, Menards, Bed Bath and Beyond, IKEA, Pottery Barn, Lowes, Sherwin-Williams, Williams-Sonoma and TruGreen are included in this category.

Keep in mind that since purchases and transactions are submitted and categorized by the merchant and not Bank of America, some of your purchases may not fall into the category that you would expect.

Which choice category should you choose?

Choosing the right choice category to maximize your rewards throughout the year depends on your spending habits. For example, November and December are great months to select the online shopping category and earn a 3% bonus on Black Friday and Cyber Monday shopping.

Bottom line

Though the Bank of America Cash Rewards card doesn’t match the earning power of the Blue Cash Preferred card, it offers a very respectable amount of cash back for a no-annual-fee card. And, for loyal customers of Bank of America, the card can be especially rewarding. In fact, if you keep a large enough balance in your Bank of America account, you might consider making the Bank of America Cash Rewards card your go-to card for all your purchases since it can beat out even the 2% cash back rate on the Citi Double Cash card. 

Related stories: Bank of America Cash Rewards vs. Blue Cash Preferred card from American Express, Guide to card-linked offer programs: Earn more rewards, How to request a credit limit increase with Bank of America