Posted by William Charles on December 15, 2014
Credit Card Review

Published on December 15th, 2014 | by William Charles

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USAA Cashback Rewards Plus American Express Review, 5% Cash Back On Gas & Military Base Spend

This guest post was submitted by Toby Cobb who is a frugal traveler that used to be in the USMC. He tries to use points and miles to spend less money and more time with family. If you’d like to submit a guest post then please read our guidelines first, if your post is accepted then you’ll receive $50 as our way of saying thanks.

USAA has recently launched a new range of credit cards, the most interesting is the Cashback Rewards Plus American Express. The biggest selling point of this card is 5% cash back on gas and military base purchases and the lack of an annual fee. Note, however, that applications are limited to USAA members.

Cashback Rewards Plus American Express® Card

Pros & Cons

Card Positives:

  • 5% cash back on gas and military commissaries, exchanges and shoppettes¹ up to $3,000 on gas purchases annually
  • 2% cash back on groceries up to $3,000 on grocery purchases annually
  • 1% cash back on other purchases with no limit
  • No annual fee
  • 0% introductory APR on balance transfers for 18 months
  • EMV chip
  • Cash Advance fees are waived when transferring funds electronically into a USAA deposit account.
  • No penalty APR

Card Negatives:

  • 5% limited to $3,000 in purchases each year.
  • 3% balance transfer fee (up to $200)
  • 1% Foreign Transaction Fee

Other points of interest:

Whenever we talk about USAA, I have to mention their incredible customer service. They’ve always been great for me, regardless of the product.

Additionally, there are special SCRA (Servicemembers Civil Relief Act) benefits, but they’re actually pretty crummy. A 4% APR when you’re deployed may sound good but Barclay and Amex completely waive all fees and give you a 0% APR the entire time you’re on Active Duty.

[Read: Credit Card Annual Fee Waivers & Other Benefits For Those On Active Duty]

USAA Membership:

You’re eligible if you fit in these categories.

  • Active, retired and honorably separated officers and enlisted personnel of the U.S. military.
  • Officer candidates in commissioning programs (Academy, ROTC, OCS/OTS).
  • Adult children whose eligible parents have or had a USAA auto or property insurance product.
  • Widows and widowers of USAA members who have or had a USAA auto or property insurance policy.

You can find more information here.

Recommendation:

I would recommend this card to someone that spends $3,000 each year at military exchanges. Military exchanges are unbonused spend for other credit cards, so the most you’d reliably be able to is 2.2% with the Arrival Plus card  or maybe 3% with the JCB Muraki .

[Read: Best credit cards for unbonused spend]

I would not recommend this card to those that can get much higher value out of credit card signups and don’t shop on military bases. The 5% cash back on gas is easily beaten by the Fort Knox Credit Union 5% gas card, as it has no limit. Or check our best gas card page for other options.

My Verdict

USAA sent me a pre-selected email offer a few weeks back and I tried to product change my old USAA Platinum Mastercard to the Cashback Rewards Plus. I was unsuccessful. I could get more value out of the 5% gas rewards, but you can’t switch Mastercard to Amex. And since USAA won’t let you get around the hard pull even for a credit line increase,  it looks like my oldest card will almost be the one with the lowest credit limit.

USAA also launched the Preferred Cash Rewards World MasterCard® with Chip Technology which offers 1.5% cash back on all purchases. Given that there are multiple cards that earn 2% or more, this isn’t a particularly interesting offering.

Thanks again to Toby for this guest post. If you have any military related credit questions then please feel free to ask him in the comments. If you’re interested in submitting a guest post then I’d recommend reading through this first.

 



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bushe
bushe

I have an older USAA American Express card that I called about upgrading and was told that no accounts can be upgraded to this card.

Jason
Jason

This appears to be a targeted offer; I called USAA and they said “my profile” only offered me a flat 2.25% for supermarkets and gas, on or off base. No 5% cash back anywhere. No 0% intro APR for 18 mos available to me.

They told me to check back next month under the “my offers” tab at USAA.com

Joseph
Joseph

Is the USAA Cashback Rewards Plus American Express not an actual Amex card in the sense of this line from the article: A 4% APR when you’re deployed may sound good but Barclay and Amex completely waive all fees and give you a 0% APR the entire time you’re on Active Duty. If it is it is eligible for AMEX’s 0% APR while serving on Active Duty?

Danielle
Danielle

I have a current offer for zero balance transfer fee in addition to the 18 months no interest on BTs.

Prof Ken
Prof Ken

I have the preferred cash rewards USAA card and tried to product change to the AMEX for the 5% gas rebate. Was told I couldn’t product change but could apply for the card. I applied and was approved. I’m still waiting on it to come this week.

Steve
Steve

Does the 5% cashback apply to AAFES.com online purchases?

Chris
Chris

This card was so annoying to get. Applied, but no instant decision. I had to call for more information. I called and I’m told something to the effect of: “The maximum credit limit we can extend you is $50,000 across all credit card products.” So my reply to that is: “But my current credit limit across all my credit card products is $54,000.” The response was: “No, sir. The maximum is $50,000.” My response: “I understand what you are saying, but I have a total of $54,000. $30,000 on this card. $15,000 on this card. $7,000 on this card. And $2,000 on this card.” And the reply was simply: “Sorry, sir. The maximum is $50,000.” That was annoying, but okay, I won’t argue the point any further. Somehow I have more than the maximum. Continuing: “If I lower the credit limit before $50,000, will that allow my credit card application to be approved?” “Quite possibly, sir.” “Okay. Then my $7,000 credit card. Let’s lower that to just $550. Would that be enough to have my application approved?” “I can’t tell you for sure, but maybe.” “Okay. Well, let’s try.” “Okay, sir. You’re credit limit has been lowered. I’ll kick this back to the applications department and they’ll look at your application later today.” “Thank you.” Hours later, I get an email saying “Please log on to usaa.com to view our decision. After all that, they apparently approved me for a different credit card (a secured credit card). So now I’m back contacting USAA: “Here is my issue (explains situation).” “Yes, sir. The maximum credit limit is $50,000. We cannot extend you more credit than that. That’s probably why you were approved for a secured credit card instead.” “I understand that. That’s why I lowered my limit from $54,000 to $47,500 earlier this morning.” “No, sir. The maximum credit limit is $50,000.” “I know you say it is $50,000, but I had $54,000 this morning before I lowered it.” “If you say you had $54,000, you’ll have to talk to someone else about that.” “Well, it doesn’t matter. If I were to lower my credit limit even more, would that help my credit card application?” “Yes, sir. It most likely would help.” “Okay. I’ll lower my credit limit again and reapply online.” “Okay, sir.” So now I go to my $30,000 credit limit card and I slash that to $10,000. I… Read more »

ChrisM
ChrisM

When I clicked on the offer, the USAA web page says no international transaction fees, which is a big deal for the many USAA members living overseas.

Zachary
Zachary

In April 2019, all of my on-base purchases stopped coding as government services and now code as general merchandise, grocery stores, etc. This has the effect of eliminating the 5% cash back category on this card, except for gasoline purchases. (No, I have not reached the $3000 limit.) USAA says they have no control over how the military bases code their stores. I don’t know if this code change is universal for all US military bases or just the several bases where I shop. Everyone who has this card should check their on-base charges to see how they’re coding now. If this is permanent, it makes this card nearly useless for me. USAA will probably be fielding a lot of complaints for this, if it affects everybody.

Zachary
Zachary

To clarify, on-base Commissary purchases (formerly 5x) are coding as off-base grocery stores (2x), and Base Exchange purchases (formerly 5x) are coding as off-base general merchandise (1x). Gas is still earning 5x, since the card is supposed to earn that on- or off-base anyway.

Zachary
Zachary

I’ve escalated this issue at USAA, so we’ll see what happens. Has anybody here seen their 5x disappear on-base? Hopefully it will turn out to be a temporary glitch.

Andy
Andy

Did this ever get resolved to where you get cash back on base again?

Zachary
Zachary

I think it’s still ongoing. First-line CSRs probably aren’t in the know, so they’ll only repeat the “depends on the merchant’s code” script, but the higher-up I spoke to said they were trying to find a solution. They manually corrected my affected purchases, but I’m not sure if they’ve worked out automatic 5x-crediting yet, to accommodate the Dept. of Defense’s apparent change to their merchant codes. I’ve tested a few purchases since then, including Commissary and Exchange, but it still seems slightly off (though improved), so they’re probably still working on it.

Any anger toward USAA is misdirected, I think. Doesn’t seem to be due to anything they did.

Gadget 🕵️

Andy Zachary Experienced the same thing. However, they did not manually credit me anything and said they couldn’t.

I think some anger toward USAA is not misdirected.

When I escalated the call, the manager said they were surprised the exchanges were coding as general merch too. So this means they know. They should let the USAA customers know if this issue exists… and they should stop advertising the card as 5% “on base” purchases if they aren’t going to fulfill that end of the deal. Where do people spend on base 95% of the time? The PX/BX/NEX/CGX, ITT, and the DECA Commissary. When/if those stop coding at 5X, USAA should inform the cardholders of this card.

I typically go to a base like once a month, usually to go to the commissary and spend like $200+. This month I purchased $600 in vacation tickets at the CGX, expecting a 5% return in rewards. Last summer worked just fine at same location. Instead got the crappy 1%. I am not going to make special trips to do test purchases, so this card just became a sock-drawer candidate.

Zachary
Zachary

I checked today and it seems Exchange purchases are coding as “government services” again, but Commissary is still coding as “grocery stores.” (That also seems to jibe with my current cashback balance.) So a possible workaround for Commissary is to buy a Commissary gift card at the Exchange and then use it at the Commissary. Maybe the merchant code for the Commissary will get fixed soon.

Gadget 🕵️

FYI William Charles Chuck On the USAA Cashback Rewards Plus AMEX, I have had the card for a year. I don’t do a lot of base shopping, but usually once a month or so. And just at a couple select bases in VA, so I am not sure how widespread this problem is. But just an FYI and fair warning… just noticed they no longer provide 5% rewards on Navy Exchange (NEX) or Coast Guard Exchange purchases, at least in my experience, when at the exact same locations last year they were 5% rewards. I just realized this as I had made a large purchase this month.

First I tried chat, got told to call, and got jockeyed around from CSR to CSR. Once I got the rewards dept, they blamed the merchant, that the merchant changed how they are coded to a general merchandise code. I asked for the call to be escalated, and to be credited 5% rewards for at least the one large purchase, and the manager refused. So, I got 1% cashback… which I let them know is a slap in the face when the norm is 2% with other cards. I also mentioned they should not be advertising the card as 5% rewards for on base purchases when I was clearly on base. The manager said it was a surprise the them the merchant category had changed, and I said where was the notice to your customers? They obviously see a lot more transactions than I do. I shouldn’t have to track my rewards daily and be surprised by changes if they knew about this change.

So, let this be a reminder that just because something codes right today may not be the same tomorrow.

Next time I go to the commissary I will have to check and see how it codes for rewards, because if that changed, this card is completely dead to me. 5% on gas is ok, but I can live without it. I also have to wonder if this change is due to planned changes in allowing all Vets use the military exchanges.

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