The Bank of America Preferred Rewards program is designed to reward customers for consolidating their financial assets with the bank. By integrating checking, savings, investment, and retirement accounts under Bank of America and Merrill, customers can unlock a range of benefits that enhance their banking and credit card rewards. This article explores the details of the program, its benefits, and whether it is worth joining. The essence of the Preferred Rewards program lies in its tier-based structure, which offers progressively better perks as customers increase their total assets held with the bank.
Understanding the Preferred Rewards Program
The Preferred Rewards program aims to incentivize customers to bring their financial resources under one roof by offering a variety of perks that increase with the total assets held at Bank of America and Merrill. The program is divided into five tiers, each offering progressively better benefits. These tiers encourage customers to consolidate their banking and investment accounts to maximize rewards and financial benefits. The consolidation effort not only simplifies financial management but also enhances the value of holding multiple accounts with BOA.
The fundamental structure of the Preferred Rewards program is built around the concept of rewarding customers based on their total assets held with the bank. As customers add more assets, they move up through the tiers: Gold ($20,000 or more), Platinum ($50,000 or more), Platinum Honors ($100,000 or more), Diamond ($1,000,000 or more), and Diamond Honors ($10,000,000 or more). Each tier unlocks new benefits and deeper rewards for customers who maintain higher balances. This structure serves as a powerful motivation for customers to bring more of their financial portfolio to Bank of America, thereby achieving a more rewarding banking experience.
Qualification Criteria and Tiers
To qualify for the Preferred Rewards program, customers must maintain an active, eligible Bank of America checking account and meet a minimum balance requirement. Specifically, they need to have a three-month combined average daily balance of at least $20,000 in qualifying Bank of America deposit accounts and/or Merrill investment accounts. This requirement ensures that only customers with a substantial level of financial engagement can access the rewards program. It’s a strategic approach that aligns customer loyalty with tangible financial benefits.
The program’s five tiers are delineated based on the combined average daily balance held by the customer. The entry-level Gold tier requires a balance of $20,000 or more and offers a foundational set of rewards. As customers accrue more assets, they can move up to the Platinum tier ($50,000 or more), Platinum Honors tier ($100,000 or more), Diamond tier ($1,000,000 or more), and Diamond Honors tier ($10,000,000 or more). Each tier offers an escalating scale of benefits, including higher reward bonuses, greater interest rate boosters, and enhanced banking perks. This tier system not only incentivizes customers to consolidate their assets but also provides a clear pathway to progressively greater rewards.
Benefits Overview
The benefits of the Preferred Rewards program are substantial and become increasingly attractive as customers move up the tiers. At the Gold tier, customers can enjoy a range of basic benefits such as credit card rewards bonuses and savings interest rate boosters. As customers progress to higher tiers, these benefits get amplified. For example, the Platinum tier offers greater savings on loan interest rates and additional discounts on investment management fees. This incremental increase in benefits encourages customers to strive for higher tiers to maximize their financial advantages.
At the top tiers, Diamond and Diamond Honors members enjoy the most exclusive benefits. This includes significant fee waivers on banking services, enhanced credit card rewards, and personalized lifestyle perks. The program’s structure ensures that those who have the most assets with Bank of America receive the greatest rewards, effectively aligning the bank’s interests with those of its most loyal customers. The exclusive nature of the top tiers adds an element of prestige, further incentivizing customers to maintain substantial balances and keep their financial activities within the Bank of America ecosystem.
Credit Card Rewards Bonus
One of the standout features of the Preferred Rewards program is the credit card rewards bonus, which significantly enhances the value of using Bank of America’s credit cards. Members earn a bonus on rewards from select Bank of America credit cards, with bonuses scaling from 25% at the Gold tier to 75% at the Platinum Honors, Diamond, and Diamond Honors tiers. This means that for every dollar spent, customers can earn up to 75% more in rewards if they are in the top tiers. This can result in substantial savings, especially for those who frequently use credit cards for everyday purchases and travel expenses.
The credit card rewards bonus applies to popular cards such as the Bank of America Premium Rewards, Travel Rewards, Unlimited Cash Rewards, and Customized Cash Rewards. For example, with the Bank of America Premium Rewards card, members can earn up to 3.5 points per dollar on travel and dining purchases, compared to the standard 2 points per dollar. Similarly, the Unlimited Cash Rewards card can offer up to 2.625% cash back on all purchases, up from the standard 1.5%. These enhanced rewards make it highly advantageous for Preferred Rewards members to use these cards for their spending, further boosting the overall value of the program.
Savings Interest Rate Booster
Another compelling benefit of the Preferred Rewards program is the savings interest rate booster. This feature increases the interest rate on Bank of America Advantage Savings accounts, providing customers with higher returns on their deposits. While the impact may be modest at the lower tiers, it becomes more significant for members in the higher tiers, particularly those with large account balances. The interest rate booster ranges from 5% in the Gold tier to 20% in the Platinum Honors and above tiers. This incremental boost can add up over time, offering a way to earn more from savings without any additional effort.
For high-balance accounts, the savings interest rate booster is particularly beneficial. It allows customers to make the most of their deposits by earning a higher yield, which can be a crucial advantage in an era of low interest rates. The boosted interest rates help to offset the opportunity cost of keeping large balances in savings accounts, making the Preferred Rewards program an attractive option for those seeking to grow their wealth. This feature underscores the program’s aim to reward customers for their loyalty and financial engagement with Bank of America.
Mortgage and Loan Perks
The Preferred Rewards program also offers significant perks for those looking to purchase a home or finance a vehicle. Members can enjoy reductions in mortgage origination fees and lower interest rates, which can translate into substantial savings over the life of a mortgage. These reductions are tiered, with higher tiers receiving more significant discounts. For example, a Platinum Honors member might enjoy a reduced origination fee and a lower interest rate compared to a Gold tier member. These savings can make a considerable difference in the overall cost of homeownership.
In addition to mortgage perks, the program provides discounts on auto loans and home equity lines of credit. These discounts increase with higher tiers, offering greater financial benefits for those who maintain substantial balances with Bank of America. By reducing the interest rates on these loans, customers can save a significant amount over time, making the Preferred Rewards program particularly valuable for those planning major financial commitments. Whether purchasing a new car or accessing home equity, the program’s loan perks offer tangible financial advantages that boost its overall appeal.
No-Fee Banking Services
One of the key benefits of the Preferred Rewards program is access to an array of no-fee banking services. These services include waived rush fees, international transaction fees, maintenance fees, and overdraft protection fees. High-tier members, in particular, enjoy these benefits, which add convenience and cost savings to everyday banking. For instance, maintenance fees on checking and savings accounts are waived for Platinum Honors members and above, reducing the overall cost of account maintenance and freeing up funds for other uses.
These no-fee services extend to other areas of banking as well. For example, members can benefit from waived international transaction fees, making it more affordable to travel and conduct business abroad. Overdraft protection fees are also waived, providing a safety net for customers who occasionally overspend. These benefits are especially valuable for those who frequently engage in transactions that might incur additional fees, making the Preferred Rewards program an attractive option for everyday banking needs. By reducing the cost of banking, the program ensures that members can focus more on their financial goals and less on ancillary expenses.
ATM Fee Refunds
ATM fee refunds are another notable feature of the Preferred Rewards program. Members in the Platinum tier and above enjoy refunds on non-Bank of America ATM fees, which is particularly useful for those who travel frequently or need to access cash from ATMs outside the Bank of America network. This benefit ensures that customers are not penalized with extra fees when using other ATMs, providing greater flexibility and convenience in managing their cash needs. For top-tier members, these ATM fee refunds can be unlimited, covering transactions both in the U.S. and internationally.
This benefit is especially advantageous for frequent travelers who may find themselves in locations where Bank of America ATMs are not readily available. By offering refunds on these fees, the program ensures that customers can access their money without incurring additional costs. This feature not only adds convenience but also reinforces the program’s value by removing the friction associated with accessing cash outside the Bank of America network. It’s one of the many ways the Preferred Rewards program enhances the overall banking experience for its members.
Merrill Guided Investing Fee Discount
For those who invest with Merrill, the Preferred Rewards program offers a fee discount on Merrill Guided Investing and Merrill Guided Investing with an advisor. This discount can significantly reduce the fees associated with managing investment portfolios, providing additional value for Preferred Rewards members. The discount increases with higher tiers, making it more beneficial for those who hold substantial assets with Merrill. By lowering the cost of investment management, the program helps customers retain more of their investment gains, thereby enhancing their overall financial growth.
This fee discount is particularly advantageous for high-net-worth individuals who conduct substantial investment activities. By reducing the fees they need to pay for professional investment management services, these members can see a more significant return on their investments over time. The fee discount also underscores the holistic nature of the Preferred Rewards program, which aims to provide comprehensive financial benefits that span both banking and investment activities.
Foreign Currency Exchange Rate Discounts
Foreign currency exchange rate discounts are another valuable perk offered by the Preferred Rewards program. Members can benefit from discounts ranging from 1% to 2% on foreign currency exchange rates, which makes international travel and business transactions more cost-effective. This benefit is especially useful for those who frequently travel abroad or conduct business in multiple currencies. By offering competitive exchange rates, the program helps members save money when converting currencies, adding another layer of value to the Preferred Rewards membership.
These discounts can be particularly significant for business owners and frequent travelers who regularly deal with foreign currencies. The savings accrued from these discounts can quickly add up, making the overall financial experience more beneficial. Additionally, these perks align with the program’s goal of making banking more cost-effective and rewarding for its members, further enhancing the attractiveness of the Preferred Rewards program.
Exclusive Lifestyle Benefits
For members in the top tiers, the Preferred Rewards program offers exclusive lifestyle benefits that go beyond traditional banking perks. Diamond and Diamond Honors members gain access to personalized experiences in travel, wellness, events, and more. These curated experiences are designed to offer unique opportunities that enhance the overall value of the program. For example, members might enjoy exclusive travel packages, special event invitations, or wellness programs tailored to their interests and preferences. These benefits add a layer of exclusivity and personalized attention, making the program more appealing to high-net-worth individuals.
The exclusive lifestyle benefits reflect the program’s commitment to providing a comprehensive and rewarding banking experience. By offering perks that cater to the personal interests and preferences of its top-tier members, the Preferred Rewards program ensures that customers receive a well-rounded and fulfilling experience. These benefits go beyond financial rewards, providing memorable and enriching experiences that add to the overall appeal and value of the program.
Maximizing Cash Reward Earnings with BOA Credit Cards
To maximize the benefits of the Preferred Rewards program, it is advisable for members to achieve at least the Platinum Honors tier, ensuring a 75% bonus on their credit card rewards. This significant enhancement makes it much more lucrative to use Bank of America’s credit cards for everyday purchases. The highlighted credit cards that benefit from this structure include the Bank of America Premium Rewards Credit Card, Travel Rewards Credit Card, Unlimited Cash Rewards Credit Card, and Customized Cash Rewards Credit Card. Each of these cards offers unique benefits, and when combined with the Preferred Rewards bonus, their value is exponentially increased.
For instance, the Bank of America Premium Rewards Credit Card has a $95 annual fee but offers substantial rewards on travel and dining purchases. When coupled with the 75% bonus, points earned can reach up to 3.5 points per dollar on travel and dining and 2.625 points per dollar on other spending. The Bank of America Travel Rewards Credit Card, which has no annual fee, earns 1.5 points per dollar on all purchases. This translates to 2.625% cash rewards toward travel for high-tier members, making it incredibly valuable for those who travel frequently. Such benefits make achieving a higher tier in the Preferred Rewards program highly desirable.
Conversion of Points to Cash
The Bank of America Preferred Rewards program is designed to reward customers who consolidate their financial assets with the bank. By bringing their checking, savings, investment, and retirement accounts under the umbrella of Bank of America and Merrill, customers can access a host of benefits that amplify their banking and credit card rewards. This article delves into the specifics of the program, outlines its advantages, and assesses its overall value.
At the heart of the Preferred Rewards program is a tier-based structure that offers increasingly attractive perks as customers increase the total assets they hold with the bank. The tiers include Gold, Platinum, and Platinum Honors, each providing progressively better rewards like reduced mortgage rates, higher interest rates on savings, and discounts on fees.
For those who frequently use Bank of America’s services, the program can be quite beneficial. It offers not just enhanced interest rates and reduced fees, but also additional credit card rewards points or cash back. These perks can make everyday banking and long-term financial planning much more advantageous.
By pooling various accounts into one institution, customers not only simplify their financial management but also maximize the benefits they receive. Thus, the program is especially valuable for those planning for retirement or managing significant investments. Overall, the Preferred Rewards program can offer substantial perks for those willing to consolidate their assets within Bank of America and Merrill.
