Bank of America - Are You Nuts?

[Dtail]

I have been their Platinum Honors customer for a number of years. Never bothered to find out what the benefits are.

Just learned about the "no-fee transactions at non-BoA ATMs". It's only for ATMs in the US though.

And what is this 75% Reward Bonus? My wife told me to use Citi Costco card instead of other cards for the reward, but how does that compare to this BoA reward? I will tell my wife she needs to look into this.

Check out Frugal Professor's write-up below on the BOA Cash Rewards credit cards.
I have 3 of them and can also further answer any questions.
There is also a whole thread in Bogleheads dedicated to the BOA CC strategy.

https://www.frugalprofessor.com/one-month-review-of-updated-boa-cash-rewards-card/

 

[Dtail]

Oh yeah. I went to the my rewards page and there was nothing. Said check back later. But hey, I didn't even know there was this rewards deal, so anything is better than nothing eh?

You would need to establish credit cards with them to start receiving rewards points, which then can be converted to cash.

 

[Golden sunsets]

We have been loyal BOA/Merrill Lynch customers for decades. We don't use their savings/CD/MM products for obvious reasons. We are platinum gold members on the bank side and Wealth Management customers on the brokerage side. At one point I had three Sub S's. My dashboard under my profile shows all of our accounts on one page for bank(including 3 credit cards) and brokerage as well as my Mom's and our kids brokerage accounts as I have trading authority over all of these accounts. I find this incredibly convenient. Merrill Edge's brokerage services including research are great I find with links to outside research very convenient. Their billpay platform is great.

I have avoided initiating ACH's from BOA for the stated reasons, but I've never run into an issue with pulling or pushing from another institution, usually Ally, which we also use extensively as a home for high yield money and as a hub for transfers to/from other institutions.

The 1.75 multiple(as a Platinum customer) on BOA Travel/Premium/ Cashback cards is as good as any other card out there. FICO score updates monthly. The Travel card links to their own Travel desk for greater rewards. The Premium card reimburses $100 annually for baggage fees and another $100 annually for Global Entry card fees. Numerous rotating linked reward sites that if checked and then charged on a cc produce cash back rewards.

We have never paid a fee for anything, including investment transactions.

We also have a free safe deposit box.

There are other bennies as well.

 

[Another Reader]

I would have been highly annoyed if I hadn’t expected this especially since it’s so rare these days. I had already a long time practice of avoiding initiating transfers from my BofA account as in the distant past they used to charge for outgoing transfers as did many branch type banks. I do care about fees even if small and avoid them - it’s my nature and part of the automatic “avoid unnecessary fees” mentality that many of us ERs seem to share.

I know that BofA can be aggressive about fees as revenue and keep an eye out. I once, just a few years ago, had my checking account type changed (upgraded?) without my request/permission and ran into a $25 charge one month because my account dropped below a threshold much higher than the original requirement. Had to go to my branch and talk to a banker to sort it out. He didn’t understand why that had happened as it didn’t match my usage and switched me back to the original type and reversed the charge. This was after the Wells Fargo scandal and reminded me of that type of shenanigan. A year or so ago I noticed that they changed the name of my checking account again, so I reviewed the checking account rules and saw that it was essentially the same as what I wanted, so no nasty surprises this time.

Fee revenue is certainly important to the banks. I have had both Wells Fargo and B of A "upgrade" my checking accounts. Wells did it maybe 20 years ago. In my case there was no fee but they used the new account to try to sell more accounts as part of the "package." I did receive a notice in advance. With B of A, I received a notice of the change, but there was a list of the changes that would occur and the options under the new account scheme. I reviewed the new schedule of fees and found nothing that would affect me, and the account number remained the same.

These practices are reminiscent of those of Medicare supplement companies that close pools and raise rates. Only sophisticated customers understand what is happening and make changes proactively.

It probably costs a major bank with millions of customers a nickel for an ACH transaction. It also saves costs because it's automatic and requires little labor to operate the system once set up. Cheaper than the customer writing checks or going up to a teller window and withdrawing cash. That's why it's offered for free by a lot of banks.

Not including the charge in the schedule of fees is offensive.

 

[Golden sunsets]

JAZZ4CaSH

I get free ACH transfers from BOA to my other financial institutions. The way to avoid the fee is to set up the outside bank account as a payee on BOA’s billpay instead of using the transfer funds tool. BOA sends some billpay funds by paper check at their discretion but most go by ACH. Out of 7 financial institutions, paper check is only used for one credit union and all the others are sent by ACH.
BOA changed the name on my account to ADV Plus Banking. It doesn’t say checking at all anymore. It’s free because I have direct deposit and the billpay is great.

Would you expand on this method of using BOA to push? So if I have an account at say CIT bank, would I set up CIT as payee and then include my CIT bank account # on the appropriate line? And then when arranging for a transfer, choose a pay date as the next available pay date? How long generally does it take for the cash to show up in your account at the other bank? Have you used this method extensively? I do get frustrated by the time it can take for money to transfer, even with Ally. It seems to be very inconsistent across various linked external transfer accounts at various institutions.

PS. Sorry for drilling you with questions.

 

[Tiger8693]

My wife was Exec Asst to the CEO of one of these LARGE banks. She told me about the board meetings where they would talk and laugh about making "pennies" adjustment to fees that customers would not recognize, but would increase revenues by mutliple $millions per quarter. The Chariman even used the frog in a slowly heating pot analogy.

I dumped them and use Regional Banks now and get good service, face to face, they always know my name, etc. They still have fees, but at least the manager remembers my name...

I can get credit card deals anywhere - there are a ton of sites to provide info on the best deals and how to maximize them.

 

[jazz4cash]

JAZZ4CaSHWould you expand on this method of using BOA to push? So if I have an account at say CIT bank, would I set up CIT as payee and then include my CIT bank account # on the appropriate line? And then when arranging for a transfer, choose a pay date as the next available pay date? How long generally does it take for the cash to show up in your account at the other bank? Have you used this method extensively? I do get frustrated by the time it can take for money to transfer, even with Ally. It seems to be very inconsistent across various linked external transfer accounts at various institutions.

PS. Sorry for drilling you with questions.

I’m GLAD you asked. I think it is an elegant solution to the issue that is being overlooked....or maybe there is some reason I shouldn’t be doing it this way!

Your description of the process is generally correct. You would set up the receiving institution just like any other payee. They may require billing address instead of routing number. Their list of payees is extensive and BOA billpay is what keeps me stuck to them.

You can pick next available date which will vary by the transfer method (ACH or paper check) which is at their discretion but I’m sure they don’t want to pay for mailing paper checks. The delivery date is actually a”deliver by “ date and I’ve never had any late payments. I generally allow a day or two buffer for billpay but it’s really not necessary especially for funds transfer. I use this technique every month including recurring transfers to fund sub-account for my big ticket escrow accounts at Ally and GS bank.

I just checked and the next available date to GS Bank is 5 business days but one of my credit union accounts only takes one day. For me the certainty of knowing in advance how long it should take makes the time required less critical.

I have no idea what dollar limit restrictions may be in place for this process. I see folks here that need to transfer huge sums of money around. My goal is to keep huge sums away from BOA but I do use them as a conduit sometimes.

 

[audreyh1]

I did receive a notice in advance. With B of A, I received a notice of the change, but there was a list of the changes that would occur and the options under the new account scheme. I reviewed the new schedule of fees and found nothing that would affect me, and the account number remained the same.

I received no notice at all. I didn’t realize there was a major fee change until I had a slightly lower balance one month. My original checking had a $1500 minimum and a $12 monthly charge if you fell below that. Somehow I got switched to a $5000 minimum and a $25 charge for dropping below that during the month! I went back through my statements and realized that I had been switched many months prior, but just happened to have stayed above higher balance. I wasn’t receiving any benefits from the new structure as I had no linked accounts.

 

[audreyh1]

JAZZ4CaSHWould you expand on this method of using BOA to push? So if I have an account at say CIT bank, would I set up CIT as payee and then include my CIT bank account # on the appropriate line? And then when arranging for a transfer, choose a pay date as the next available pay date? How long generally does it take for the cash to show up in your account at the other bank? Have you used this method extensively? I do get frustrated by the time it can take for money to transfer, even with Ally. It seems to be very inconsistent across various linked external transfer accounts at various institutions.

PS. Sorry for drilling you with questions.

Just have CIT request the incoming transfer. Cleaner.

 

[Another Reader]

I received no notice at all. I didn’t realize there was a major fee change until I had a slightly lower balance one month. My original checking had a $1500 minimum and a $12 monthly charge if you fell below that. Somehow I got switched to a $5000 minimum and a $25 charge for dropping below that during the month! I went back through my statements and realized that I had been switched many months prior, but just happened to have stayed above higher balance. I wasn’t receiving any benefits from the new structure as I had no linked accounts.

I suspect that state bank regulators in California are more aggressive in regulating consumer accounts. That may explain why I got the detailed notice.

 

[Dtail]

The 1.75 multiple(as a Platinum customer) on BOA Travel/Premium/ Cashback cards is as good as any other card out there. FICO score updates monthly. The Travel card links to their own Travel desk for greater rewards. The Premium card reimburses $100 annually for baggage fees and another $100 annually for Global Entry card fees. Numerous rotating linked reward sites that if checked and then charged on a cc produce cash back rewards.


There are other bennies as well.

Agree in general, but have found that even though the reward for travel is greater by using their travel desk, their travel desk does not always get the best rates which can more than offset the additional reward %.

 

[scrabbler1]

I have BoA as my main bank. As others have posted, I initiate all ACH transfers into and out of BoA from the other institution, from brokerage accounts to utilities. No fees from BoA. I use BoA's online bill pay for one bill and BoA mails a paper check. No fee.


My main credit card is with BoA so a few point-and clicks when using their online banking and I pay the bill. No fee, of course.


I keep enough in the checking account plus a cushion to avoid monthly account fees. I consider the excess my first-tier emergency fund. I don't keep much in there, as it earns no interest, and I hate the idea of tying up anything more than ~$4,000 earning zilch to be too much. I use only BoA ATMs to avoid fees.


That being said, I don't like how BoA gradually reduces its services which used to be free and either requires higher account balances to keep them (i.e. upgrade to a higher-level checking account) or paying a few dollars a month. The biggest example of this is to get canceled checks back. We went from getting the actual checks back to seeing check images in the monthly statement to having to pay for those images. I can still view them and print them out on line, although the images are smaller than the actual checks. (One time, I had to read some info off the back of a check because the payee put the wrong number on it and credited someone else with my payment. From the actual check, it was doable. From a check image, it would have been a PITA to see an enlarged image.)


Account minimums have gone from average daily balances to minimum daily balances, the latter a higher standard because with the former you can drop below it once in a while without incurring any fees. The latter you can't.

 

[jazz4cash]

I think (assume) the account minimum/average for free checking does not apply if you have direct deposit set up as I do. I pay 20 bills or so using billpay and pay no fees. The only fee I’ve had to pay is 6.00 if my savings account drops below $1000. Last time that happened it was overdraft coverage which would’ve cost 12.00 otherwise. The thought of keeping 4K in an account @ 0% makes me sick.

 

[Lakewood90712]

Classic frog in the hot water experiment. seeing how much heat the customer will take before jumping out of the water or stay and be killed with fees.

Another example Kroger ? Ralphs now charges 50 cents for cashback with grocery purchase.

 

[NW-Bound]

Check out Frugal Professor's write-up below on the BOA Cash Rewards credit cards.
I have 3 of them and can also further answer any questions.
There is also a whole thread in Bogleheads dedicated to the BOA CC strategy.

https://www.frugalprofessor.com/one-month-review-of-updated-boa-cash-rewards-card/

Thanks. I looked at it, but need to get my wife interested in this. She's the one who tracks this stuff, while I am already occupied with other stuff.

 

[Golden sunsets]

Just have CIT request the incoming transfer. Cleaner.

Yes I do, but I was curious about Jazz's method, thus my example for clarification. If it takes 5 days to move the money then there is no reason to initiate from BOA, but if it takes just a day, in some cases that might be faster than pulling from the other institution.

 

[Golden sunsets]

Agree in general, but have found that even though the reward for travel is greater by using their travel desk, their travel desk does not always get the best rates which can more than offset the additional reward %.

True I always check alternatives to see if there is a lower price. I guess I have too much time on my hands.

 

[Global Wizzo]

BoA Fees

None of my online high yield savings accounts charge an ACH transfer fee, and neither do my brokerages. So I always initiate transfers from one of those institutions - whichever direction. As a result I have never been charged a transfer fee from BofA.

I keep my BofA account for convenience - it's a good checking account. We have a couple of safe deposit boxes at a nearby branch. Their online capability and billpay has been excellent - one of the best early on. So I find them easy to use, get free checks, and maintain a minimum balance so no charges and have a couple of very handy credit cards with them. But I avoid anything that results in a charge such as ATM use at a non BofA ATM or worse foreign ATM as their fees are quite steep!

If you travel internationally, BA does not charge ATM fees for using their corresponding banks ATMs to pull cash. Just pulled some AUD in Sydney from my primary account. Transfer to AUD was almost equal to the official exchange rate. Less than 10 cents difference. That is valuable enough to tolerate some of the other annoyances. I do use other accounts to pull money occasionally, but don’t initiate outbound transfers.

 

[Elizrogers]

I would just point out to people who say "it's only $2 or $3 dollars" and find it easier to pay than fight. If it's not appropriate or they hid it in fine print, they are hoping you won't care to spend time complaining. Sure, it's only a couple bucks to you, but times that by several thousand people they may do it to in a year and it's good business for them. I would move my business from a company who used such practices and let them know why I'm going. There are too many other banks who would love to have your "not insubstantial" account. And enough people calling them on it, might cause them to change such sneaky practices.

 

[RobbieB]

I like B of A and it will take more than 3 bucks to change that. I don't care about those other thousands of people, they can go elsewhere. Less people in line that way.

 

[Gkk2001]

B of A...no way

It was already mentioned, go to a credit union. By far the most cost effective way to bank. At year's end, I get a check for doing business with my local cu.

Any big name bank is in business to satisfy the CEO first and the shareholders second. Definitely not to service you without paying, someone must pay the $20 million the CEO makes. It sure as hell will not be me. I wished I learned this lesson 40 years ago.

 

[NoMoreJob]

I'm surprised by this thread. I have a BofA checking account (actually two of them because I opened a second one to make sure that there would always be enough in the account to autopay our insurance premiums). There is no minimum balance for the accounts, I just need to make an automatic deposit of $50/month into each one which I do from my investment account at another institution via ACH (push). We us BofA Billpay through the main checking account at no cost. I never pay any fees, that's $0/month on both accounts. As far as I'm concerned that's a great deal!

I don't know what an outgoing ACH would cost, if anything, since I've never tried it.

 

[Lagniappe]

I learned something about BofA /Merrill today. I started with an ACH from my B of A checking account to another bank, and ran into the $3 ACH fee, so canceled the transaction. But when I initiated the same transfer from my Merrill account, there was no fee. And it is free to transfer from one BofA account to another.


Just thought this might help a few people in the New Year, if you have both bank and brokerage accounts with Bank of America.

 

[dixter]

I got tired of the charges and no returns from the bank so I changed to
BanKdirect.com they at least give me airline miles with AA.. 60K per year... thats a nice trip to Hawaii each and every year for free... just for having a savings account... better than nothing...

 

[VungTau]

Fidelity doesn't charge for wire transfers...