U.S. Bank has launched a new credit card soon called the U.S. Bank Smartly Visa Signature Card. The card earns 2% cashback everywhere, which isn’t particularly exciting seeing as there are many cards on the market with that earning rate.
What does make it far more eye-catching is the fact that it’s possible to boost the total earnings up to 4% cashback.
Card Details
| Card Offer and Details |
|---|
None ⓘ Non-Affiliate Currently no welcome offerNo Annual Fee Information about this card has been collected independently by Frequent Miler. The issuer did not provide the details, nor is it responsible for their accuracy. FM Mini Review: On its own, an OK cashback card with no annual fee, but becomes much more powerful if you have deposits with US Bank. Base: 2% Card Info: Visa Signature issued by USB. This card imposes foreign transaction fees. Noteworthy perks: Earn better cashback rates when you hold a balnce in an eligible US Bank account: $5,000-$49,999 = 2.5% total cashback; $50,000-$99,999 = 3% bonus cashback; 100,000+ = 4% cashback |
Quick Thoughts
The Smartly card earns 2% standard cashback. You can then boost that rate if you have a U.S. Bank Smartly Savings account and have the following amounts deposited:
- 0.5% bonus cashback (i.e. 2.5% total cashback) – Qualifying balance of $5,000-$49,999
- 1% bonus cashback (i.e. 3% total cashback) – Qualifying balance of $50,000-$99,999
- 2% bonus cashback (i.e. 4% total cashback) – Qualifying balance of $100,000+
As you can see, you’ll have to deposit $100K with U.S. Bank in order to earn that 4% cashback rate. That’s a steep ask for many people, but you don’t have to hold that amount in cash in a Smartly Savings account. Instead, you can have $25 in that savings account and the remainder in any mix of the following types of account:
- Consumer checking account(s)
- Money market savings account(s)
- Savings account(s)
- CDs and/or IRAs
- U.S. Bancorp Investments
- Personal trust account(s)
That’s useful because the Smartly Savings account is currently only offering 4.1% APY. Although that’s a solid rate, there are many savings accounts out there offering at least 5.1% APY.
$100,000 in total deposits matches the amount needed to earn Platinum Honors with Bank of America. Platinum Honors provides the opportunity to earn up to 5.25% cashback depending on which cards you have, so if you only have $100,000 to deposit then it might make more sense to go the Bank of America route.
However, if you have at least $200,000 in eligible savings, depositing $100,000 with both U.S. Bank and Bank of America could be worth doing if you’re able to generate a lot of spend on your credit cards and don’t want to cycle spending on your Bank of America card(s). What’s worth remembering though is that Bank of America cards only earn up to 5.25% cashback in certain categories, whereas this Smartly credit card will offer 4% cashback on all purchases.
The cashback will be redeemable at full value when redeemed as a deposit into an eligible U.S. Bank deposit account. If you want to redeem the cashback (earned as points) as a statement credit on your credit card or through other redemption options like gift cards, you might not get that full value.
If you end up applying for this card, something important to be aware of is that if you don’t earn or redeem the points on your account for 12 consecutive statement cycles you’ll lose your entire points balance. While some card issuers might close accounts due to inactivity after a year, I can’t think of any off hand that will forfeit all your points/cashback earnings too.
That’s a disappointing policy and one that’ll mean you won’t want to accidentally sock drawer this card. If you’re earning 4% cashback then that might not be an issue as you’d likely be putting at least some spend on it, but it’s a policy that’s worth being aware of.
When U.S. Bank launched the Altitude Reserve card back in 2017, they were initially very sensitive to people buying gift cards using their mobile wallet to earn 3x points per dollar. It’ll be interesting to see if they’re quite as sensitive to people racking up 4% cashback on this new Smartly credit card.
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The self-directed brokerage account appears to have a $50 fee. The fee is waived if your balances are above 250k.
I heard some talk about another way to get the fee reimbursed?
Eitherway, I am disappointed that there weren’t any talks about that in your review. Everyone who gets this card will likely be wanting to hold the money in a brokerage account and it’s important to know how to avoid these fees.
I’m starting to look into this now. Regarding the $50 fee, US Bank’s website says “Annual account/IRA fees may be waived for clients with a statement household balance > $250k.” I’m not sure what to think about the “may be waived” terminology, but my guess is that it would be waived in most cases.
https://www.usbank.com/investing/online-investing/self-directed-investing/brokerage-fees.html
US Bank’s fraud department has an itchy trigger finger. I had the Altitude Reserve and had only bona fide purchases. Expensive bona fide purchases. Not looking at my entire relationship with the bank — which might have explained those expensive purchases — the fraud department closed my card and my checking account. A representative directly said to me that I was commiting fraud. In turn, I closed a rather sizable investment relationship. Go fish.
Does paying taxes count for the 4%?
Does anybody know if the 4% would apply to an authorized user on the cc account? If not, the strategy might change…
Yes, it should. I’m not aware of any USB cards that have different rewards structures for AU cards vs primary.
Tim, do you happen to know if USbank gives the authorized user a different cc number (like chase) or like Citi (that gives the same cc number on the card)? I’m wondering this as far as keeping track of expenses…
For USBAR, my wife and I have the same cc number.
thank you, Jason…now to maximize…
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So if you forego an extra 1% interest on $100,000, that’s $1000 you have to overcome. If you earn an additional 2% cash back with the card, you need to spend $50,000 before breaking even.
If you account for the fact that interest is taxable and cash back isn’t, assuming 30% marginal taxes, you need $35,000.
If you can transfer investments to US Bank and the fees are comparable, then this becomes a potentially attractive option, but I didn’t delve further than this article into that.
Anyone know if a joint account will allow 2 players to get the increased rates?
I put too much spend on SUBs that get 10x, I know it’s apples and oranges but seems like over 70% of my spend this year has been on SUBs, so I have no interest in this card, but good if you want one card.
US Bank’s investment options are pretty gross though – their self-directed account has a $50 AF. Adding insult to injury, they still have a per-trade fee and an oh-so-generous 100 free trades per year. BofA/ME is at least free.
Transferable point strategies can yield higher values. However, if your objective truly is cash back and you’re doing actual spending (not MSing) and your qualifying balance is via an investment account (and not savings), this is attractive. Indeed, this might be a better card than the Altitude Reserve for some.
Two big questions are whether the rate will be uncapped and whether the card will have foreign transaction fees.
I agree with Captain Greg that a caveat must be made regarding BofA’s Cash back opportunities.
To be clear, the 5.25% isn’t everywhere, right? The better comparison might be 2.625% vs 4%. When the alternative is a 2% card, this new card seems like an outstanding deal. Wouldn’t you agree?
That’s correct, I should’ve clarified that in the post – I’ve just added that regarding the 5.25%. This card would indeed be an excellent deal on everywhere else spend for minimal effort. Depending on the transaction value/type of their everywhere else spend though, some might prefer buying fee-free Visa and Mastercard gift cards at office supply stores when there are sales to earn more than 4% cashback on other types of cards.
And I think 5.25% CB is only for $2500 per quarter on some restricted categories. Citi Custom Cash 5 TYP or 5.55 TYP with Rewards Plus is an easy win to me.
BoA 5.25% on some niche categories with small cap is overrated imo. But BoA 2.625% with everything however is very good.
Yes 5.25% on the bofa ccr is only in select categories and up to 2,500. I have the card and it is used up in a purchase or so.
One of the categories is online purchases which is so easy these days with order online and pickup in store. It is also easy to get multiple of the cards from BoA my family has 5 of these cards.
US Bank still has fees on their investment program as well, that most including Merrill Edge has eliminated and also a $50 AF. So, you’d definitely have to weigh if possibly paying more for your investments is worthwhile for a card that likely won’t remain at that rate for too long.
I think the best I can do now is charge taxes to an Amex biz blue and then buy tix at a value of 1.5 c for 3 pct earnings at a cost of 1.82-1.87 pct. This seems like a much better deal as I can deposit the money right away instead of waiting until I have a trip… or is there a better deal out there?