Mileage Earning Debit Cards Revisited

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After lots and lots of emails and comments from a post written over 10 months ago, it seems like it is time for an update.   But before we get into that you should sign up for our email list here.

So let’s start fresh on this debit card mess.

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There are dwindling options for those with a desire to earn points and miles based solely on the use of a checking account debit card.  But don’t despair, there are still a few options out there.

It’s worth mentioning that we should pour one out for a fallen friend, the SunTrust Bank Delta Debit card.  It was okay while it was here, but in retrospect he was less and less a valued friend towards the end.  Two and a half years ago the card would award 30,000 miles for the personal version and 25,000 for the business version.  The cards came with an annual fee of $75 for the personal, $125 for the business card and earned 1 SkyMile per $1 spent on the personal and 1:2 on the business card.  There was also a monthly maintenance fee on the card of $12/month (if your balance averaged under $3,000) for the personal and business cards ($4,000 month on business cards).

But over the years the bonus went down to 5,000 for the personal card, nothing for the business card and then just went away altogether.  Meanwhile the fees did not diminish, and assuming that you did not maintain the minimum balance requirements the personal card would cost $219/year.  Assuming that one had a high level of spending (lots of trips to Wal-Mart) you might achieve 6,000-10,000/miles per month.  I personally averaged about 6,000 and the card seemed like a good deal to me exchanging a coach seat Hong Kong (old award chart for Delta) for $219 and then some.  The bank was a little tough to deal with at times and I never had a branch in my home town, but really it was Delta that dropped the value of this card through the floor.  While they maintain “saver level” seat prices, like the traditional 25,000 for a round trip domestic ticket, in my experience there were rarely seats at this level which is the same as raising the prices to me.  If a price is listed as available for 25,000 but there are never any seats at that level, to me it doesn’t really exist then.  This also became less profitable for the banks as a limit for what they can charge merchants was introduced and pinched the margins for everybody.

Looking back though, that offer is not as good (to me) as what is available in the market today. Here are the current options available:

UFB Direct Airline Rewards:

– No sign up bonus

– 1 mile per $2 spent

– No monthly Maintenance fee

– American Airlines

–Link

Citibank Checking Gold **** Do this now as the code expires December 31st, 2014! ****

– 30,000 mile sign up bonus! (must maintain the account for two months)

– No ongoing earning

– $30/month maintenance for balances less than $50,000

– Must have at least (2) bill pays to achieve the bonus

– American Airlines

– Link  Code: DTTEZS60ML Select Gold Checking Account

… There are smaller bonuses for smaller accounts, but at $60 for 30,000 miles I don’t see why you wouldn’t go for this one…

Bank Direct 

– 1,000 point bonus for new accounts (checking and/or money market, each earn 1,000)

– 100 miles/$1,000 average monthly balance, no spending bonuses

– There are too many other bonuses to mention, most of which take 6 months of continuous activity to earn totalling about 25,000 miles annually

– $12 Monthly Maintenance fee (at least $72 to receive a majority of the bonuses)

– American Airlines

–Link

In a desire to be thorough, I will also list the Bank of Hawaii, Hawaiian Airlines Debit Card but my experience with them was terrible.  I do not recommend that you participate with this bank unless you live in Hawaii.  I also do not trust them based on some bad policies.  To be fair, their staff responded to me with a reasonable resolution to the cancellation of my account but only after I escalated the matter, and it should not have to come to that.  

Bank of Hawaii (Bankoh), Hawaiian Airlines Debit Card:

– No sign up bonus

– 1 mile per $2 spent

– $3 Monthly Maintenance fee

– $40 ACCOUNT CLOSURE FEE!

– No ability to upload checks using the app until you have been with the bank for at least three months.

– Capped at 2,500 miles/month (30,000 per year)

– Must be run as “credit transactions” eliminating billpays, debit card loads, money orders, etc.

– Hawaiian Airlines

– Link  **** I DO NOT RECOMMEND – It’s really bad.

I have tried all of these accounts with the exception of BankDirect.  Here is my experience with each of them.

SunTrust Delta Debit – DEAD

Delta Debit, as you can see above eroded its value to little fault of the bank.  The bonuses were nice, but I can understand why they did not last.  The fees, however, were excruciating.  When I parted ways with the bank, I had recently paid my third year card fee which was a mistake by the Sherpa.  It happens, but at the time I was so ready to move on that I didn’t care.

In the three years with the bank I had more than gotten my value out of the card.  With bonuses I earned more than 150,000 miles for a cost of about $500.  That’s fair enough, but not as good as it was in the beginning.  My first year I achieved 70,000 of those miles for about $220 and that should have been where I quit.  The biggest strength for this card was the spending for me.  I was able to control how many miles I earned each month with no cap.

While there are sneaky ways to manufacture spend with this sort of a card and bonus system, I was comfortable with a normal amount of miles per month and feel I got a great value out of the card.  As an introduction to the bank, it was just kind of “ok”, nothing spectacular but nothing where I would say I will never be back. I wrote about it extensively here.

This deal is dead, and I doubt it will be revived.

UFB Direct Airline Rewards

This is my current daily-use bank.  The name of this bank is UFB or Bank of the Internet which does not initially fill me with confidence. However, after working with them for several months I have found them to be a really good bank.  I have not had any issues with mobile deposits, withdrawals, and points are awarded with about a two month lag.  My only complaint is that the bank does not have 24 hour phone assistance, which may or may not be better than outsourced 24 hour phone service.  I highly recommend this for those that will be paying all of their bills through their debit card or will load it on to a bluebird, there is no mileage incentive for customers to hold a balance.

Citibank Gold

Citibank (financier of American Airlines and customer of over $1bn worth of miles) has premium checking accounts and offers incentives American Airlines Aadvantage customers to join.  Their top level account pays out 30,000 miles, which is enough for a round trip to Northern South America, the Caribbean, anywhere in the US, and nearly enough for Europe (40k off-peak, 36k off-peak with a Citi credit card rebate of 10% of miles spent).

The headline figure is huge for an account without a credit check and this is the only truly substantial bonus available for those with troubled credit history or those who have exhausted every card option available.  It’s a ton of miles, but it comes with some stipulations. Here is what is required to earn the 30,000 miles.

– You must pay the monthly maintenance fee ($30/month) for at least two billed months (sometimes they give you a month free if you have had an issue or at sign-up before they get you into the billing system – these do not count).

– You must spend $750 on debit transactions out of the account.  Any spend other than billpay counts, I would get it out of the way as soon as possible.

– You must have at least two billpays for two consecutive months.  Citi is registered with everybody and their billpay system is pretty good, but payments towards Citi accounts (mortgages, lines of credit, credit cards) do not count.  Pay your cell phone bill, and remember you can always pay a friend if they are not listed in the system.

– Ineligible if you have received THIS bonus in the last 18 months – meaning from a checking account and not from the credit cards.

The Sherpa and Sherpstress have both done this one before and it went okay.  It was great traveling abroad because Citi ATMs are everywhere, and this means no ATM fees when withdrawing cash.  We had some other issues with the account, but we got credited a month or two and those issues were specific to unauthorized use from a merchant when abroad so I don’t fault them there.

If you are going to cancel your account after the two billed months and other requirements have been met, I usually try and see the points hit my account or confirm on the phone (get their name and extension if possible) that I have met the requirements and should expect the bonus before closing.  I have found it is a lot easier to get the points you deserve when you are an active customer as opposed to after you have already left the bank.

For full disclosure there are other accounts available at lesser monthly fees bonuses between 5,000-15,000 miles but $60 for 30,000 miles and a little hassle is the best possible deal.  As Citi does not offer incentives beyond the sign-up (no additional miles for balances nor spending) I don’t see why you should hold on to the card unless you love it.  But for the one time bonus, this is a great find.  The offer expires at the end of the month, so don’t think about it, sign up now.

BankDirect

For those that have high balances in their checking account, this can be a hassle-free way to earn miles.  For anyone else, this is the most complex account in existence to get the available bonus of up to 30,000 miles per year.  I have not dealt with them personally, and to be fair, if I had $25,000 that I felt I needed in a checking account (not otherwise invested or in savings), this would be a good account to have.  LeBron James loves this account, you know, because of all the “hoops” you have to go through to get the points.  Terrible Dad jokes aside, let me give you a run down of what awards what bonus and you can decide if this is the account for you.

– 1,000 points for opening (each) a checking account and/or money market paid at account opening.  That one is easy.

– 10,000 points for using direct deposit (sounds easy right), of at least $2,000/month (ok, but some might have trouble especially if they work part time) for six consecutive months.  Ugh, that means they won’t be paying out for at least seven months from the time they receive the first one (following billing cycle after six months).

– 5,000 points for using your BankDirect Visa CheckCard,  again that seems easy to do right? Well, as long as you have a minimum of 12 transactions per month (I don’t usually since I use my credit card for everything), totalling at least $500/month (I guess if did Bluebird loads this would work), for six consecutive months.

But wait… there’s more.

– 5,000 points for BillPay as long as you are paying at least three payees a combined $500/month for six consecutive months.

– 1,000 points per referral who opens at least one or both of the accounts.  “Your friend must submit the information accurately from the email solicitation received.” with a lifetime maximum of 10,000 points.

– You also earn 100 points/$1,000 average monthly balance in the account which is really quite good if you have a decent savings sitting around.  Take the $25,000 example, you could earn 30,000 miles per year just from the money sitting there.  But when you subtract the fees, there isn’t that much of a benefit until you get to $50,000 average balance.

– There is no spending point accumulation.  Whether you charge $1000/month to your card of $25,000 you would earn no miles from the actual expenditure like you would with UFB Direct.

– There is also a fee for the account of $12/month.

When looking at all of the hoops, for people who do not have credit cards and use their debit cards for everything, this could be a better account than UFB, for limited savings and limited spending, but it’s not a good fit for me.  If I missed a hoop and lost out on a bonus I would be fairly frustrated.  That being said, if I was looking for a place to move $50,000 and earn 60,000 miles per year for the cost of $144 (12 months @ $12 each) it might be a better deal.  In all honesty, I would likely use this as a money market savings account over an active checking account given a substantial sum in savings.

Bankoh (Bank of Hawaii)

If you live in Hawaii and want to go to the mainland or Asia Pacific, this might be a really good account for you.  But outside of those 30 people, this is the worst possible account you could try.  If you were looking for an account where you can only deposit outside of Hawaii by way of mailing a hand written check, or incurring the cost of a wire transfer, this is your account.  The worst part is that it’s not even that Bankoh do not have the technology to upload a picture of a check, it’s that they DO have the technology but new accounts are ineligible for the first three billing cycles.  Those are the most critical cycles as you deposit funds and learn to work with the bank and their systems.  Being locked out at that time seems to be the worst time for new customers, but they prefer this as they build trust in their clients.  During that period you will continue to incur $3/month maintenance fee.

If you decide that this is not the right bank for you (as I did) they have the gall to charge you $40 to close the account with no way to waive the fee at their front line call center.  I had to escalate the matter beyond a level that should be done for a case like this in order to avoid the fee.  It was not worth the hassle.  Further, the bank offers hours convenient to Hawaii which is inconvenient to half the country operating on Eastern time.  I know, I know, “But Sherpa, it’s a Hawaiian bank, what do you expect?” I expect any bank that operates online and allows me to open an account 5,000 miles away (and five time zones) to be open at least during all time zones in which they allow an account to be open.  I might be a child of the internet age, but the costs of keeping one or two people (or even outsourcing minimal call work) working during these hours would have possibly kept my business.  Hawaii represents a dream for a lot of people, and I would imagine they would have a huge market outside of their home area, in fact those are likely the people typically buying tickets on Hawaiian and most interested in their miles.  Maybe I am way off base here, but it just seems ridiculous to not have someone available to service the account when all that one would need is some training, a phone and a computer.

Lastly, I really hate the monthly limit.  They only allow up to 2500 miles per month at an earn rate of 1 mile per $2 spent.  They also need to be used not as debit card transactions but run as credit transactions (which means you cannot get cash back, cannot buy money orders or other instruments and increases the amount the bank receives for transactions).  A limit of 30,000 Hawaiian miles per year given the restrictions above, and at a cost of $36 plus all the ATM fees and I am again, not a user.  I really do not like that they tried to charge a going away fee after I learned that I would not be able to deposit a check for 90 days and made a mistake.  That seems like a vindictive policy and there are too many other options to do business with such characters.

If you still want to go to Hawaii (and you should) but you don’t want to pay for it, try the Hawaiian Airlines credit card. The Sherpstress has it and there are tons of benefits.  If you sign up from this link you are supporting myself and UPGRD.

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There were lots of questions and emails about this topic and I hope I have been able to shed some light given my experiences.  I appreciate all of you writing me emails and comments and if I can further clarify please let me know.  If your question is not best placed in a public forum please email me at sherpa@thetripsherpa.com and I will get back to you as soon as I am able.

Thanks for reading.

-Sherpa

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