Reviews

USAA American Express Rewards Credit Card Review

ReviewsUSAA offers many financial products to military personnel, their families, and the military, and credit cards are among the most popular. The USAA American Express Rewards Card offers a low interest opportunity and rewards program to earn major points on gas and grocery purchases. If you qualify, you may want to seriously consider the USAA Rewards American Express card.

Main characteristics

  • Bonus when registering. When you make your first purchase, you receive a 2,500 point bonus, which is worth $ 25 if redeemed for a plane ticket.
  • Rate. There is no annual fee. Balance transfers are 3% with a maximum fee of $ 200. Foreign transaction fees are 1%.
  • APR. The APR for purchases and balance transfers ranges from 9.90% to 25.90%, depending on your creditworthiness and changes in the prime rate.
  • Rewards program. You earn 2 points for every dollar spent on gas and groceries, and 1 point for every dollar spent elsewhere. There is no limit to the number of points you can earn and they do not expire. Points can be redeemed for cash, merchandise, gift cards, or airline tickets booked online at USAA.com or over the phone. If you redeem your points for plane tickets, each point is worth a penny; they are worth a little more if you exchange them for cruises through Explore Cruise Travel. However, the value of each point is less if it is redeemed for cash, merchandise or gift cards. For example, you can redeem 3,500 points for a $ 25 gift card or certificate at popular retailers like Macy’s, Marriott, or Staples, or you can redeem 3,000 points for a $ 25 credit. However, if you redeem more points for cash, the value of each point increases. For example, 20,000 points can be redeemed for a $ 200 statement credit. You can also donate your points to organizations like Habitat for Humanity: 6,000 points equals a donation of $ 50.
  • Eligibility. To be eligible for USAA Rewards American Express, you must be a USAA member. This requires you to be an active duty member, a retired and honorably separated officer, or a member of the United States military. You may also be eligible if you are an officer candidate in a commissioning program such as Academy, ROTC or OCS / OTS, or if you are an adult child of a USAA member, spouse or widow, or widower of a service member.
  • Military benefits. The Service Members Civil Aid Act (SCRA) provides for a reduced interest rate of 6% on credit obligations incurred before the start of active service (this also applies to Reservists and National Guardsmen). USAA offers a 4% lower interest rate on pre-existing USAA loans and credit cards. Other military benefits include a reduced rate of 4% on USAA credit cards for active duty members who are deployed or deployed, or those undergoing a permanent change of position. Additionally, members who receive a qualifying campaign medal can have all interest incurred during that campaign refunded to their USAA credit card. Eligible campaign medals include the World War on Terror Expeditionary Medal, the Iraq Campaign Medal and the Afghanistan Campaign Medal.

Advantage

  1. Little interest. Cards with rewards programs, especially for everyday purchases, rarely offer the option of benefiting from a low interest rate. If you have a balance on your USAA Rewards card and make your minimum payment each month, the interest rate could be almost half that of other rewards cards.
  2. No limit or expiration of points. There is no limit to the number of points you can earn with the USAA Rewards card, even in the gas and grocery bonus categories, and they do not expire. Rewards programs often impose a maximum number of points that can be earned in bonus categories, and once that limit is reached, all additional purchases in those categories default to the “other” rate of 1 point per dollar spent.
  3. No rotating categories. Many other rewards programs require cardholders to enter rotating categories each quarter to earn their bonus rewards. If you don’t remember to register or buy anything in these categories, you only earn one point for every dollar spent. With the USAA Rewards American Express card, all gas and grocery purchases earn 2 points for every dollar spent, every time.
  4. Military benefits. USAA offers its members additional benefits, including an APR of 4% for active duty members, lower than that required by SCRA, as well as the opportunity to earn all interest in a campaign where you earn a medal of eligible campaign refunded to your USAA card.

Disadvantages

  1. Low sign-up bonus. The 2,500 point sign-up bonus is the lowest offered by rewards cards and is worth a maximum of $ 25 if you redeem it for travel. You need 2,500 extra points if you want to redeem them for gift cards. While there is no annual fee, there are other cards that grant gas and grocery purchases and offer better sign-up bonuses, also with no annual fee. For example, the Chase Freedom card and the BankAmericard Cash Rewards card have signup bonuses worth $ 100.
  2. No introductory APR. It is common for rewards cards to offer an introductory 0% APR on purchases and balance transfers for a period of 9 to 15 months. Find out, Chase Freedom and American Express Blue Cash Everyday are offering 0% for 15 months. All three cards allow “daily” purchases and none have an annual fee.
  3. Low point value. Unless you redeem your points for air travel, cruises, or cash (which requires 20,000), your points are worth less than a penny each. Other cards, like Chase Freedom and Discover it, allow redemption in the form of statement credit, check, or direct deposit, and the rewards are worth at least a penny per point.
  4. Foreign transaction fees. Although the overseas transaction fee is only 1%, if you make purchases outside of the United States, these fees could void any rewards you earn. Credit cards with no overseas transaction fees, such as Discover it and Capital One Quicksilver Cash, may be more suitable if you plan to do a lot of shopping overseas.

Last word

The USAA American Express Rewards card offers excellent, low-interest reimbursement opportunities for service members. However, many other cash back cards allow daily purchases like gasoline and groceries and offer better rewards and bigger signup bonuses.

Verdict

If you can qualify, the USAA Rewards American Express card includes some benefits that you may find useful.

Goal

3.9 out of 5 stars: Many other cash back cards reward everyday purchases, such as gasoline and groceries, and offer better reward opportunities and cheaper sign-up bonuses. However, it is a great card for military personnel and their families who can benefit from low interest opportunities and unlimited rewards on daily purchases.

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