Alliant Credit Union 2.5% Cash-Back Visa

[Anonymous]

Not sure if this would be against the terms of the forum to include the link, but here-goes. I ran across it a couple days ago when playing around on their site, 4-7-17. Not sure of the "official release date."

http://www.alliantcreditunion.org/bank/visa-signature-card

3% the first year, with the AF waived, and 2.5% on-going rate with $59 AF.

I know it's not "amazing" because of the annual fee, but if you spend more than $1,000/mo on it, it outweighs the AF enough to give you more return than a 2% card (not necessarily a noticeable difference at only $1/yr, but just as a basis of how much spend would be needed to be beneficial over a 2% card). Granted, the 2.5 from USAA is a lot more noteworthy due to the lack of an annual fee, but if you are looking for more cash-back return on a general spend card, this could be a good alternative, as I'm sure many of us on the forum spend well over $1,000, not sure about on a gen-spend card for each of you, but I'd venture to guess a large chunk most likely break that spend (sometimes within a week) very easily. Not sure about Alliant's underwriting/SL criteria/habits, but figured I'd share. Not sure if it's new, or if I just now happened to notice it for some reason.

The site says it is "designed exclusively for those that spend 50,000+ per year on their card", which comes down to 4,000/mo. I would think that is hinting at doable (maybe even sizable) SLs.

[Anonymous]

Thanks for sharing and it's perfectly ok to post links like you did.

[Anonymous]

I'm not sure if you need to bank with Alliant as you would with USAA for the card, let alone join. Posting the link to the card I believe is okay. I think only referral links and the like aren't. And don't forget the 3% in the first year. If I can just apply and not have to join, or at least not hold an account like with USAA, this may be worth it. And the Limitless card isn't available nationwide like with this card.

[Anonymous]

Interesting post. I wonder that, if you bank with Alliant and have relatively significant assets with them, if you will be able to ask to get that AF waived. Otherwise, I see that $59 AF being a burden compared to the simple 2% CITI DC for example.

[Anonymous]

Someone help me with my math: after the first year, one would have to spend $2,360 to break even on the $59 annual fee? ($2,360 x 2.5% = $59.00) So, if you spend $10,000 per year on this card it would be $250 cash back, but then subtract the $59 annual fee and you are left with $191. If you use a Citibank Double Cash, you only earn $200, but with no annual fee you actually come out ahead by $9. 

I was all over this card until I did the math (if I am correct). Could be interesting to see if people use the heck out of this card for the first year for the 3% and then close it after the first year.

ETA: I see they clearly state that the card is designed for big spenders. Anybody know what the breaking point is for this card (starting second year) so that even after the annual fee, the card still outearns a 2% no AF card? $50,000 x 2.5% = $1,250 - $59 = $1,191 vs $50,000 x 2% = $1,000; so this card would net $191 more even after the annual fee. 

Do big spenders usually go for cash back cards?

[Anonymous]

As the OP said, you need to spend 12K yearly to outperform a 2% card. But the minute you go overseas, the 2% DC is a -1% back card due to the FTFs. While this would still earn 2.5% and no FTFs.

I think this is a great no hassle use one card solution. The Limitless that matches this card offers 2.5%, no FTF and best yet, no AF. But one must have a monthly direct deposit of $1000. I know the interest rate of USAA caps at .15% so it doesn't come close to the 1.05% Synchrony, AlliantCU and other online banks offer (you lose about $59 per year based on interest from only the deposits for one year). This does assume you use USAA as the only savings account (which i believe you need to have to get their card) And you need to keep depositing 1K each month or you get only 1.5%. And that deposit needs to be done as ONE transaction (I'm paid weekly so I can't come close).

Big spenders probably get the fanciest card they can to show off. But the smart ones, go for things that give the greatest return. 2.5% beats out most cards and many probably would take a half percent loss in many categories to not opt in or manage 10 or so cards to maximize. Afterall, time is money and half a percent loss for much more time to put towards higher rate of return investments makes them able to keep being big spenders. That or I see them using the Chase Trio due to the flexibility.

[Anonymous]

culinarykid92 while you bring up some good points, the USAA Federal Savings Bank was established for those with a military affiliation and was not focused on the general market place. They established the Limitless Cash Rewards as a better earning card for their members (customers). The Limitless requires one of their checking accounts for the direct deposit. As you mentioned it is no AF, no FTF and 2.5%. Like many other banks often you seek better earnings elsewhere. As you mentioned there are several places where you can obtain over 1%. That is true for many of our credit card providers. With the USAA Card I don't have an AF and the game I have to play to ensure I at least break even. Now Myficoer's savor in challenges and it seems from reading on this board have the spend to chase the higher level spend cards. For those of us who don't have the big spend sometimes it pays to maximize our opportunities.

[longtimelurker]

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@Anonymous wrote:

Someone help me with my math: after the first year, one would have to spend $2,360 to break even on the $59 annual fee? ($2,360 x 2.5% = $59.00) So, if you spend $10,000 per year on this card it would be $250 cash back, but then subtract the $59 annual fee and you are left with $191. If you use a Citibank Double Cash, you only earn $200, but with no annual fee you actually come out ahead by $9. 

I was all over this card until I did the math (if I am correct). Could be interesting to see if people use the heck out of this card for the first year for the 3% and then close it after the first year.

ETA: I see they clearly state that the card is designed for big spenders. Anybody know what the breaking point is for this card (starting second year) so that even after the annual fee, the card still outearns a 2% no AF card? $50,000 x 2.5% = $1,250 - $59 = $1,191 vs $50,000 x 2% = $1,000; so this card would net $191 more even after the annual fee. 

Do big spenders usually go for cash back cards?

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Math is trivial.  

The card earns 0.5% more than a 2% card.   So 0.5%*X > $59 to make up for the AF, so X > 59/0.005 > $12,116 a year as the OP said   

This ignores the free first year at 3%, where clearly any spend at all is better than a 2% card

[Anonymous]

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@Anonymous wrote:
culinarykid92 while you bring up some good points, the USAA Federal Savings Bank was established for those with a military affiliation and was not focused on the general market place. They established the Limitless Cash Rewards as a better earning card for their members (customers). The Limitless requires one of their checking accounts for the direct deposit. As you mentioned it is no AF, no FTF and 2.5%. Like many other banks often you seek better earnings elsewhere. As you mentioned there are several places where you can obtain over 1%. That is true for many of our credit card providers. With the USAA Card I don't have an AF and the game I have to play to ensure I at least break even. Now Myficoer's savor in challenges and it seems from reading on this board have the spend to chase the higher level spend cards. For those of us who don't have the big spend sometimes it pays to maximize our opportunities.

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I wasn't trying to trash USAA, but rather help people understand the difference/benefits of the 2. So sorry if I came across that way. USAA doesn't have any interest in their checking (I assumed a savings account since my company says it allows direct deposits into one, though I just add to checking and transfer as needed). Some may prefer more work to maximize. But some also prefer a little less work at the cost of $59 (really less since checking doesn't have interest and needs a min balance to remain open).

USAA is open to everyone if you join one of the organizations (not sure the cost to join). Same with Alliant (I know Alliant is $10 if you need to join). And as I said, Alliant comes with 1.05% interest so it does simplify things. Either are great options as long as you jump through the hoops to make them better than other cards.

[Anonymous]

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@Anonymous wrote:

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@Anonymous wrote:
culinarykid92 while you bring up some good points, the USAA Federal Savings Bank was established for those with a military affiliation and was not focused on the general market place. They established the Limitless Cash Rewards as a better earning card for their members (customers). The Limitless requires one of their checking accounts for the direct deposit. As you mentioned it is no AF, no FTF and 2.5%. Like many other banks often you seek better earnings elsewhere. As you mentioned there are several places where you can obtain over 1%. That is true for many of our credit card providers. With the USAA Card I don't have an AF and the game I have to play to ensure I at least break even. Now Myficoer's savor in challenges and it seems from reading on this board have the spend to chase the higher level spend cards. For those of us who don't have the big spend sometimes it pays to maximize our opportunities.

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I wasn't trying to trash USAA, but rather help people understand the difference/benefits of the 2. So sorry if I came across that way. USAA doesn't have any interest in their checking (I assumed a savings account since my company says it allows direct deposits into one, though I just add to checking and transfer as needed). Some may prefer more work to maximize. But some also prefer a little less work at the cost of $59 (really less since checking doesn't have interest and needs a min balance to remain open).

USAA is open to everyone if you join one of the organizations (not sure the cost to join). Same with Alliant (I know Alliant is $10 if you need to join). And as I said, Alliant comes with 1.05% interest so it does simplify things. Either are great options as long as you jump through the hoops to make them better than other cards.

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I don't believe USAA is open to anybody who joins/donates to a certain organization anymore. It looks like they cut that off in 2013, correct me if I'm wrong. I'd be down to donate to get into USAA though..... haha