If you’ve read about my problems with credit cards, you’ll see why this is so frustrating. Just when I had settled on the PenFed Platinum Cash Rewards card and chose it as the one card for me to use (5% on gas and 1% on everything else), I received a letter “Announcing a new way to earn more rewards.”
Starting on February 1st, 2012, “in order to maximize the financial value we can deliver to you through this lower purchase APR, the earning rate for rewards on non-gas purchases will also be adjusted from 1% to 0.25%.” Fortunately, the 5% rewards on gas will continue…but for how long? The APR is being lowered from 13.99% to 9.99%. Since I pay my bill off in full each month, I could care less what the APR is.
If I stick with the card I currently have, I’ll get to keep the 5% back on gas as well as the convenient monthly cash rewards deposits. If I switch, I’ll get rewarded in points. 5 points for gas, 3 points for supermarket, and 1 point on all other purchases. Not many details, such as the minimum number of points needed to redeem, are yet available. However, it says on the letter that the points can be redeemed for merchandise, travel, gift cards, and even Visa prepaid cards. If I switch I also get 5,000 immediate points and another 20,000 if spending at least $1000 in the first 3 months…essentially $250 for switching. The problem with this is that the points can be devalued and why would I want to buy products with a prepaid card when I could just use the credit card and get cash back? (If I change my mind, I’ve read that the deal still applies come February.)
So, it looks like I’ll be switching back to the Bank of America Cash Rewards card. 1% on everything, 2% groceries, and 3% gas paid in cash but not until $25 are accumulated. I’ll use PenFed for gas but Bank of America on everything else. PenFed’s customer service is great (nearly as good as Schwab’s). I’m not impressed by Bank of America at all. I’ve been on hold for the last 33 minutes and counting after being told that the wait was around 5 minutes. “We appreciate your business…please continue to hold” x 15+ times! What a joke! At least they are very friendly once I actually get to talk with someone.