Originally posted 12/5/24. Reposting 12/17/24 as I finally completed the process to get the 4% and got all the other accounts set up. Updated the post below with all the details.
Contents
Bank of America 2.62%
Until recently, the Bank of America 2.62% setup was the king of simple cashback rewards, better than the standard 2% earned on other cards. It’s possible to earn 2.62% everywhere with no annual fees, and I my experience with the Bank of America program was overall positive.
The catch to all this, of course, is the $100,000 deposit requirement. Most of us move over brokerage funds or retirement funds to meet that requirement, but not everyone can do that.
Robinhood 3%
Robinhood is in roll-out phase of their 3% everywhere card. You do need to spend $50/$60 annually on Robinhood Gold to get that card.
There have also been reports of Robinhood not allowing rent payments, tax payments, or large purchases from earning rewards. And there’s apparently a $40 replacement fee if you ever need to replace the card. Ugh.
Enter: U.S. Bank 2%-4%
The new kid on the block in U.S. Bank with their Smartly Visa 2%-4% card. The setup is similar to that of Bank of America where those with $100,000 in assets with the bank get top tier rewards on the card and earn a whopping 4% cash back.
The card has no annual fee. There’s no signup bonus on the Smartly card. There are foreign transaction fees. They offer 0% APR for 12 months, though personally I don’t typically use those offers on personal cards.
It’s worth noting that the card also earns 2% everywhere by default, without the need for any deposits with U.S. Bank. And you can get 2.5% everywhere with just $5,000 on deposit. Both of these tiers will be interesting to some people. Further, there’s a 3% tier for those with $50,000 on deposit.
My Signup Experience
I don’t manufacture spend, but I do often have nice chunks of organic spend which includes income taxes (federal, state, business) and property taxes. I’m more comfortable paying with a credit card than a bank. In the past I’ve often paid taxes with the 2.62% Bank of America card – those rewards usually cover the fee associated with paying taxes on a card and allows even a small profit.
If all goes well, the math will work out even better with the U.S. Bank 4% card. These rewards would even cover fees of 3%+. There are various other places (rents, school tuitions, Plastiq, etc) who add on a ~3% transaction fee, and the 4% rewards on the Smartly card can cover that.
And so I decided to give the U.S. Bank Smartly 4% card a shot.
After applying I heard absolutely nothing from U.S. Bank for many days. Around a week after applying I received an email indicating approval. Yay!
There have been those who were only approved with minuscule credit lines, but I was lucky to have received a reasonable $15,000 credit line. I confirmed the credit line with a rep over the phone. (Regardless, reports indicate they are good about raising credit lines afterward.)
If you already have personal accounts with U.S. Bank, you should see the card pop up in your login and the credit line will be visible there. There’s no way to use the card immediately before the physical card arrives. Regardless, I won’t be using the card for some time until I complete the qualifications for the 4% rate.
Reminder: U.S. Bank allows various personal credit cards to be product changed into the new Smartly card. You can avoid the application and the guesswork on the credit line by using the product change option. I didn’t have any U.S. Bank personal cards and I applied for it as a new card.
Opening the Savings Accounts
In order to qualify for the 4% earn rate, you need to have a savings account. You don’t need to hold funds in the savings account as you can have the $100k in a brokerage/IRA account (or part in the savings and part in the brokerage). But you need to be a savings account holder.
There have been those who – after getting approved for the 4% card – got declined for the savings account for reasons unknown.
After getting the credit card approval, I cautiously applied for the savings account and was instantly approved. Hooray!
The only hiccup I ran into was on the $250 credit card funding. I tried two separate U.S. Bank Triple Cash cards and both got declined. (Others have had success with that card.) And then the system prompted me to use ACH funding – after two fails it forces you to use the bank transfer funding method. And so I ended up linking my regular bank account to fund the minimum $25 opening deposit.
Opening the Brokerage Account
If you don’t want to hold $100k in the savings account, the other option is to holds stocks or mutual funds in a U.S. Bancorp brokerage account or IRA account. (We’ll discuss fees later in this article.)
I had no issues opening a brokerage account and was instantly approved. The hiccup came when I tried transferring assets from within the login and got an error message, “only certain USBI brokerage account types are eligible for online account transfers from other institutions.”
Speaking with a U.S. Bank investment rep, I learned that U.S. Bank does support online asset transfers, like all other modern brokerages. He mentioned that my account needed time to fully settle before transferring assets and that I should try again in a couple of days.
He also mentioned that they are having issues recently with the online asset transfer system, and so it might not work even after my account is fully settled and open.
He said that I can call into the investment department (800-888-4700) to initiate the asset transfer. They’ll confirm transfer details over the phone and create a form with all the details. They’ll email me a link which will prompt me to login and simply sign the form in order to get the transfer going.
In the end, I was able to do the online asset transfer option and it worked painlessly. The only hiccup I had was the system asked for PDF statement from my prior brokerage to help speed things up, but the system errored out when I tried to upload the statement, so I just completed the transfer without that optional PDF upload and it worked perfectly. Also note: The system sends you to a pdf with the details of your transfer for your records; you don’t need to send any physical form in.
It took less than one week from when I initiated the online brokerage transfer until it showed up properly in my U.S. Bank login. (I have not yet been able to confirm that the cost basis came through properly.) Within hours/days, I was able to see that the card is updated to earn 4% – this informtion is visible by going into the ‘Rewards’ tab on the card.
Reportedly, you can call in to have automatic Dividend Reinvestment (DRIP) set up. Personally I like manually reinvesting so I’ll leave it be.
Opening the Checking Account
This step is optional, but since I’ll anyway have a credit card, savings account, and brokerage account with U.S. Bank, I decided to make it a clean sweep and take advantage of the $450 U.S. Bank checking account bonus.
- Opening a checking account also gets you 100 free trades per calendar year.
The $450 bonus is slated to end on 12/30/24, and I applied soon after getting approved for the card and savings and brokerage accounts.
I wanted to stack it with the $90 Swagbucks/MyPoints bonus, but apparently that offer is targeted and I can’t seem to find it in my Swagbucks or MyPoints. And so I just applied directly on the $450 checking bonus page.
The checking account application went pending and I waited over a week until getting a physical mailer from U.S. Bank about it. The letter clarified that I need to call into the authentication department in order to get the checking account approved.
I called in and the rep easily approved the application. I immediately got an email confirmation of the account approval. She mentioned something about there having been an influx of applications and therefore many had to go through the manual application process.
She also confirmed that they can see the $450 promo offer is still properly attached to the account. I’ll first fund my account $25 via external transfer. Then I’ll try doing two $4,000 transfers to meet the direct deposit requirement and get the $450 bonus. It looks like most ACH transfers count for this. I’ll track my progress for the bonus on the dedicated page in the login (“Track Progress Toward Your Cash Reward”).
Avoiding Fees
U.S. Bank does have a competitive savings account with decent APY rates, and someone flush with cash might consider parking $100,000 there to be eligible for the 4%. If you do so, you don’t need to open a brokerage account with U.S. Bank, and then you have no fees to worry about.
It is worth noting that at high cash levels, even small interest differences can really matter. E.g. if you’d otherwise be with any account which earns .5% higher interest (or that amount of tax savings) you’ll end up losing $500 per year on the $100k. Ouch.
Instead, most people are planning on moving over $100,000 into U.S. Bancorp Investments. They offer a self directed option there, and you get 100 free trades per year on the account, provided that you also have the Smartly checking account.
There is a “$95 Account transfers and IRA closeout fee“, but if the plan is to remain with U.S. Bank long term that wouldn’t be a major concern. Furthermore, there are often brokerages (like Fidelity) who will cover transfer fees on large asset transfers.
$50 Annual Fee Waiver
The main fee that everyone is discussing is the $50 annual account fee. Per the fine print, that fee is waived with $250,000 balance.
And so, for someone who wants to keep this setup entirely fee free, the price just went up from $100k to $250k. (There has been some discussion about IRA accounts having a lower $50k threshold necessary to waive the $50 fee, but I’m seeing conflicting info on that point.)
I was considering moving over $100k and just swallowing the annual fee. I reasoned that the extra 1%-2% in credit card rewards can justify it.
I chatted on the phone with a U.S. Bank investments rep who told me that brokerage accounts with $100k+ will have the $50 fee waived. I inquired about the $250k mentioned on the site, but he confirmed with me that there’s always a minimum required and that the minimum is now $100k. (Yes, I asked the question multiple times from multiple angles.)
The $250k is only for someone who is using combined balances of deposit accounts and brokerage account, but $100k in a brokerage alone is sufficient to waive the fee. Others report hearing the same from bank reps. It’s also been noted that the $50 fee hits after 12 months from opening, so you have a full year to get yourself to $100k.
I can’t promise you that there won’t be a fee with $100k balance, but I have a good feeling about it and so I’m personally going to take the chance on it.
Final Thoughts
Ultimately, for me, whether this whole thing ends up being worthwhile will come down to whether U.S. Bank gets petty about which transactions earn rewards. We saw them crack down on the Altitude Reserve mobile wallet 3x earnings to dis-allow large gift card purchases and similar. There’s a a good chance they’ll do something similar with the Smartly 4% card.
Even if they do crack down on large gift card purchases, hopefully they’ll allow tax and rent payments to go through and earn rewards. Worst case, I’ll just use the card for smaller, boring purchases. There should be some value in that too, though, honestly, I wouldn’t have set the whole thing up for that. Hopefully the $50 annual fee won’t be an issue, as discussed above.
View Comments (317)
has anyone confirmed what happens if your investment balance goes below $100k due to market movement?
e.g. i put in $100k, buy stock, stock price halves, do i need to fund an additional $50k just to get 4%?
Yes
FAQ states the following:
Combined Balances are based on the average daily balance of the previous 3 months (calculated monthly) (or, for account(s) open less than 3 months, the average daily balance of the applicable time frame). The applicable Smartly Earning Bonus will be determined by reviewing the Combined Balances in the qualifying accounts of each Cardmember (if there is more than one) and using the total Combined Balances of the individual whose accounts have the highest total.
If a U.S. Bank Smartly Card account has an Authorized User(s), the U.S. Bank balances of the Authorized User(s) will not be reviewed and will not qualify for determining the Smartly Earning Bonus. The Smartly Earning Bonus that will be applied to your Account is determined within the first 5 days of each month, which means that the bonus applied to your Account may vary during a billing cycle.
See disclosure #1 below for more information on how we calculate combined qualifying balances.
New customer data point: $450 bonus, $25k credit line with 4% back activated in 35 days
When I deposited the cash via check, the USB teller suggested waiting 3 months/cycles before asking for a CL increase, but I was able to go from $500 to $25k after the first month statement/cycle. Could be luck, underwriting CL request, or the multiple payments made to the card within the first statement cycle.
I can now see all 4% cashback charges
I know 3.44% savings isn't strongest APY but considering taxes on interest, its not that large of a difference ($360 year on 100k going from 3.8 to 3.44) while the 4% cashback can be used to reduce expenses at 100% of its value (not taxed) as a deduction on the expense.
@guest_1972617 When you applied for the credit limit increase where they raised you to $25,000, did US Bank run another hard pull on your credit file? Thank you.
Was your CL increase another hard pull?
I went through the whole process of setting up a brokerage, checking, and savings account. The whole process was a complete cluster F. The last straw was when they locked me out of my account because I logged in from two different IP's (That is what their security team said). I went into the branch to have them unlock me. About 10 minutes later I hear "He's standing right here with his ID and you can't unlock him?". I told her to cancel all 3 accounts and you could tell she was embarrassed. I was planning on moving a large chunk of money to their brokerage but I had zero trust with moving a $1 to this company.
The mere fact that US Bank charges some kind of BS fee (I forget what they called it) for depositing cash in-person at a B&M location is all I needed to know for me to *never* do business with them again.
No offense, but that's kind of an odd reason to stop doing business with USB. If it really irks you that much, why not "punish" USB by churning their bonuses over and over again like I do?
Sorry to hear.
if they nerf the credit card, then I wouldn't say "keeping checking, savings and investment accounts with US Bank" for the long term is a good idea. I am going to wait a few months and see how this plays out first before going through the hoops.
There's an argument to be made that a person should take advantage of an opportunity while it exists. Think of X1, Bilt, etc. But, US Bank has been in a trend of devaluation for a while and I can't help but think that the four percent might not last. And, like you, I see the hoops as a big disincentive.
Separately, US Bank's fraud department has an itchy trigger finger. High bona fide spending (that is, not MSing) has triggered account closures. I had a significant banking relationship with US Bank and they closed all of my accounts over a $10k clothing purchase and a $10k jewelry purchase on an Altitude Reserve. After verifying the purchases were bona fide, the fraud department representative nonetheless said I was engaging in fraudulent activity. It was rather offensive. In the end, their loss.
Reddit member just posted:
https://www.reddit.com/r/CreditCards/comments/1hi9i0v/us_bank_closed_my_altitude_reserve_card_without/
Oof, guessing you used a mobile wallet?
About the BofA 2.62% setup, that Premium Rewards card also pays higher cash back on restaurants and broad travel categories. At platinum honors tier, it’s 3.5% cash back no cap. No FTF but has $95 af, and $100 airline credit that’s easy to use.
You also don’t need to keep the $100k there all year, just 3 months to requalify at your anniversary. I move my brokerage funds for bonuses the other 9 months.
Pair with Customized Cash card that gets 5.25% on chosen category (online is my favorite) on up to $2500 spend per quarter.
I didn't know about being able to move it the next 9 months, thanks!
There's Travel Rewards that has no AF.
I don't think it has restaurants and travel categories but I personally don't care as I have those on other cards at 5%.
It also has a Foreign Transaction Fee (FTF).
No it doesn't https://www.bankofamerica.com/credit-cards/travel-credit-cards/
I prefer straight cash back vs statement credits for travel and dining purchases. Looks like it only has 2.62% max cb on travel and dining spend. No AF and no FTF are nice though, can work well for some people.
UCR is $0 AF.
UCR has FTF and max cb is 2.62%. Premium Rewards is essentially no AF with the $100 airline credit for domestic carriers. PR can work well as a one card solution without checking categories and caps.
My UCR actually has no FTF but this was an upgrade offer from a Travel Rewards card and no FTF was explicitly stated in that offer. So, this has been the perfect go-to card for our family. I might get the PR too this year.
Also, 5% cashback is easy to get for smaller purchases for me. I buy the Visa/MC GCs from the Staples No Fee promo using my Ink Plus card.
The 4% Smartly doesn't seem worth the hassle to me if U.S. Bank is going to nitpick on the purchases like federal taxes, large property tax fees or other purchases.
Too much "guess and check" with this card right now. One of the nice things about Bank of America is that, after initial set up, it's pretty much "set and forget." BoA doesn't nitpick over specific transactions, they seem not to care one iota about what qualifies for 2.625%, and on on the CCR, the "online spend" category is probably the broadest in the industry.
To me, this just isn't worth the hassle right now with all the comments about potential fees and nitpicks over property tax, large payments, etc. Also, USB has a history of throttling payments on other cards.
Also, I think Merrill is a more established broker than USB...
What's this about flagging large spends? Has USB done a lot of that before? Will it not count towards the 4% cash back?
They just put a $200 cap per transaction (for rewards) for any gas/ev purchase on my Biz Triple Cash card (this is not unique to me, just an overall change to their T&Cs). I don't often hit that (but sometimes, motorhome holds ~75 gallons).
@guest_1972012,
You made some fantastic points. A lot of people (including @6) keep on comparing this new USB card to the UCR. However, what he and others fail to mention is that by moving funds from your Merrill brokerage to USB, you will also lose the 5.25% "online" rate on however many CCRs that you have. Some may have more than 2. 😉
Now of course if you are made of money, then you can have $100K+ in both USB and Merrill and enjoy the perks of both. 😀
Sorry, what guess? I thought it is 4% for everything and unlimited.
Did you reply to the wrong comment?
You have three months, beginning on your Preferred Rewards anniversary date, to move 100k back to BoA/Merrill to requalify...
If you move 300k for the Merrill bonus then you only need 1 month.
This adds a lot of friction.
More friction than moving your funds between sketchy banks like others want to do? lmao, ok
I've heard that from others also. I certainly do not want to move my money back and forth between brokerages. To each their own.
Indeed, to each there own. But it is enticing when I move $250k-$300K to ME/BoA, I collect $1K when I pass go. Normal bonus is ~$600, sometimes the deal is $900. But current churn is $1K for me.
Agree 100%
I'm curious on the checking bonus “Track Progress Toward Your Cash Reward” thing, I didn't see any on online bank or mobile app. Do you have a link for that?
it should show up when you click in to look at the account details:
- on the site it shows on the bottom of my account info above the transactions
- on the mobile app (ios) it shows right below my balance in the Overview tab
Thanks
instead of this credit card, with all the funds in savings/brokerage at USBank, why not buy gift cards for $500.00 in groceries or drugstores with a 5%/6% acct? BCP @6% and (if lucky to have OBC cards @ 5%) and have some P1 , P2 accts to get around the 6k annual cap. And AMEX has $250.00 bonuses on the BCP. Plus a few Citi Custom cash 5% cap at 500.00 monthly and of course numerous 200.00 fee free Staples VGC using Inks. If you do not like this setup, get a Discover Miles for 3% on everything which gives 3% after 12 months! Of course, I'm assuming you can liquidate loads of 500.00 VGC easily. Also, for 100k in a USBank savings acct, there are still many accts paying 4.5% and more right now. USBank is 3.5%. Just my 3 cents!!! BTW, Discover does not care if you buy VGC. Still 3%. No q. ever. Done it numerous times. And it's churnable!!
You must have a lot of free time on your hands.
Yeah. I'm 72 and retired. My main job is MS. Spend about 2 hours 3 days per week buying cards and liquidating for mo. And depositing to Disc debit and One card.
Plus depositing in person to a few banks and credit unions. Western Union mo state that mobile deposits are prohibited. That was a big hit to my biz.
Then about 2 hours per week checking deposits an reconciling. I start at 8AM and stores are empty. Back home with p2 by 10:30 and have the rest of the day to do whatever .
I worked my ass off for 50 years, I deserve to do this.
Where can you buy money orders with Visa Gift Cards? Western Union Stores let you do that?
lmao..... on a more serious note, the release of us smartly and discontinuation of usbar caused me to reflect on the current state of credit card benefits. the stipulations involved to "reap" fractional "gains" of microscopic basis points across card issuers makes it all a pissing contest. the golden age of real benefits and the simple content of 2% unchained are nostalgia. parking big cash in usbank instruments for 4% just to save the time and headache of pulling out this card x or that card y and constantly instructing p2/grandma/grandpa when to use which card z may very well be worth it if you are not entrenched in this racket or had enuf already. im older now but not any smarter now... just arguably 4% wiser now...... and here's a shoutout to the citi dc/cc/rewards+ trifecta dusty underdog for 2.22-5.55% and 2.775-6.9375% "effective" if you splurge all your thankyou points on citi's 20% cyber monday.
How do you liquidate the cards if you don't mind me asking?
He wrote "Spend about 2 hours 3 days per week buying cards and liquidating for mo. And depositing to Disc debit and One card."
I admire the hustle
> I’m assuming you can liquidate loads of 500.00 VGC easily
This is often an assumption that doesn't hold for people who aren't MS gurus. VGC are accepted at fewer and fewer places, there's a greater risk of cards being drained fraudulently if you hold them long term, and if you have an issue with the retailer when you use them organically, I'm guessing a US Bank consumer card will yield an easier process to do a chargeback than with a VGC.
Also, I think the big allure of this card is not needing to MS your way to 4%+ with multiple BCP and CCC cards, but just using a single card normally.
Having a USB savings account constantly open for this card means the 12 month clock never resets on savings bonuses. That's a forgone $100-$200 a year. Idk how much 2% spend/year I'm doing that would be upgraded to 4%, but it's probably not too far north of $10K making this card a wash.
What saving bonus???
THE U.S. BANK SAVINGS SIGN UP BONUSES
I don’t see a sign up bonus. You got a link?
It comes and goes, use a search bar
Buuut that $100-$200 USB Savings bonus is typically only achieved by tying up~$20k for 3 months that could have been easily earning 4% elsewhere. AND will be taxed at a much higher rate than the 0% that applies to credit card points. Hmmm
Moving all or a large chunk of your net worth to one of the worst banks ever, what could go wrong?
What makes them "one of the worst banks ever"? I've certainly had issues with them with not receiving bonuses properly on my credit cards but most of the time CS eventually makes it right.