I’ve been enjoying earning 4% on all purchases using the U.S. Bank Smartly card. Since I prefer cashback, this takes away much of the thought process in using one card or another since 4% will usually be close to what the other card would be earning, anyway. I’ve also found myself avoiding signup bonuses with large spend requirements since the math doesn’t math when there’s a 4% loss on the spend amount.
Alas, the news broke that starting 9/15/25 there is a $10,000 limit per month on the 4% earn, and that some categories like Taxes and Insurance are excluded. Some people also got the ‘bad nerf’ version of change in which they’ll need $100k in their checking account to be eligible for the 4% rate. Most people, myself included, got the ‘good nerf’ version which still allows brokerage deposits to count toward the $100k.
Since I’m already set it up with the whole Smartly system, my plan is to continue using the card as before. Even a transaction which does not earn the full 4% will still earn a respectable 2%, which is only slightly worse than the 2.62% with the Bank of America relationship cards.
For paying taxes I’ll switch over to a BofA card. Credit card signup bonuses with high spend requirements will come back into the mix when my Tax spend category is only a “loss” of 2.62%.
The new exclusion which is most vague to me is the “Business to Business transaction” category. I’ve used my Smartly card to pay various contractors for home improvements and the like. These were often large charges and they sometimes have credit card processing fees tacked on. I happily accepted that given the expected 4% return, but going forward I might pay via cash/Zelle instead due to the uncertainty on the rewards.
My billing cycle closes on 2nd of each month. Since the change starts from 9/15/2025, does that mean during my next cycle (9/3/2025 to 10/2/2025), if I make payment of $20K to IRS for estimated tax on 9/3/2025, I will still earn 4% on all $20K? The following term in the notification is a little unclear to me, because my billing cycle will end after September 15 2025.
The following rewards program updates will take effect September 15, 2025.
Earn up to an additional 2% cash back on your first $10,000 in eligible Net Purchases each billing cycle when paired with a U.S. Bank Smartly® Savings account
We know that bank reps sometimes give out info that ultimately is inaccurate, so feel free to call in and verify, but I feel confident the info confirmed to me which has always been my understanding of how the rewards work is correct.
Thank you
midas89
There’s no doubt that I and a lot of grandfathered people will be making sure to get in as many large transactions covered in the exclusions category transacted before the 9/15 deadline as possible.
By the way, the 0.01% hesitation is only because somewhere, somehow, someone could slip on a banana peel and change the outcome entirely. Or because the 0.01% covers the possibility that aliens are messing with us for a reality TV show. 😀
Got the good letter, so will still benefit from taxes & insurance (until any future nerf) and use for most transactions. Exceptions: 6% dining on BofA Customized, 5% grocery on AAA Advantage, and Chase/Discover 5% quarters.
by “will still benefit from taxes & insurance (until any future nerf) “, do you mean you did not get exclusion of these two categories?
Another consideration is the $50 annual fee for the brokerage account. Compared with the 2.625% Bank of America card, you will need to spend about $3,600 annually on the Smartly card to make up for the fee. Compared with a 2% card, its $2,500.
Any plan that doesnt involve cutting it up and lighting it on fire is wrong
Math doesn’t math how? Why would you settle for 4% before maxing out as many relatively large SUBs as you can get?
You’re velocity-limited to about 10 large SUB cards per year IME. Maybe you could do 12/yr. Many have churning clocks so if you skip one, you lose a churn.
The bottom of the barrel would be something like Signify, which yields 10%+2% (plus a 12 month float) on $5k spend. Or BoA with 10%+1.5% and a 9 month float. Most are better.
How does 11.5% with a 0% float not beat 4%?
If only spending 5k then comparing 11.5% with 4% works. SUBs are walls for some, speed bumps for some and control joints for some.
You would have already spent at least $50k-$60k for better returns before scraping the last $5k at 11.5%.
You wrote, “If only spending 5k then comparing 11.5% with 4% works.” A more accurate comparison might be:
If only spending [60k] then comparing [14%] with 4% works. I’m guessing you need to open more new cards.
Can you really do 10 large subs a year without blowing up credit rating? I assume you aren’t concerned with chase 5/24 limits?
My plan is basically the same. Smartly is still a good card for everyday expenses, and considering USBAR nerf will be my everyday driver for most purchases (outside of excluded categories).
My taxes and insurance will now be paid with whatever card I’m working on a SUB for.
What I am unclear about is what exact B2B will include. E.g. if DMV or my HOA use payment processing services to accept payment via credit card, and those charge 2-3% fee, are all of those now B2B and will be excluded from 4%? That was really my main target for this card.
No brokerage = hard pass
Paypal Mastercard at 3% cashback would be way to go now for tax payments.
you can pay taxes with paypal??! (otherwise the paypal mc only earns flat 1.5% back)
Thank you for that suggestion.
Where haven’t I seen bait-and-switch before? Oh yeah, US Bank! Checking account!
AGREED! This card also reduces the “pain” associated with wife’s spending to choose which card to use.
This is a major plus for me as well.
If I stopped using my Smartly I would probably come out ahead since I can get 5% on most of my spending. But then I’m juggling 4-5 cards across multiple banks and I annoy my wife.
Maybe why we got nerfed. Besides some insurance and schools fees, pulled all my wife’s cards and gave her the smartly because it was just simpler for her. Alas, she is going to have to go back to the savor, amex BCP, and Costco. for dining, groceries, and Gasoline. I may look at the other suggestions in the thread. Have been staying away from bonus category cards, but maybe it’s time now.