New Terms for my PenFed Platinum Cash Rewards card

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.

2 thoughts on “New Terms for my PenFed Platinum Cash Rewards card

  1. Nathan

    Go with the Platinum Rewards…it’s great…I use my credit card for everything…and would get anywhere from $20-40 a month with Cash Rewards (12 months * avg $30= $360)…so with the $250 deal you get the card, just as good as cash…And, you’d be surprised how quickly points add up…I have had my card since May 24th and I have already reached that $1000 promotion level, and have requested my $250 prepaid card…Also, I have accumulated 2,211 more points…make the jump! PenFed is a good deal. Added info: they have $25, $50, $100, $250, and $500 prepaids and other great items for redemption. It essentially comes out to 10,000 points equals $100, so for a camera retailing for about $500, you’d need 50,000 points, but they accumulate quickly. Just make your card the card for your auto payments (cell phone bill, gym membership, etc).

  2. Scott

    In the short term, you were probably right. I would have been better off getting the $250 reward for switching and then cashed out of those points before they got devalued.

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