I love cash back credit cards. If you pay in full every month, it’s a great reward. I’ve been shopping credit cards lately, and found the Schwab Bank Invest First card is a very appealing cash back card. It offers 2% cash back on everything. It’s our Free Money Friday deal of the week!
Update: Schwab won’t be taking applications for this credit card after March 2010. You can still open an account using this Schwab link.
Update September 2011: We just received a letter that our Schwab card is being replaced by a Bank of America card. It looks like the end of the Schwab card is near. We plan to switch most of our purchases to the American Express 6% Cash Back Credit Card.
How to Get Your 2% Cash Back
- Open a new Schwab Bank Invest First card and a Schwab One Brokerage Account.
- Once approved for both accounts, link them together. You can call or go online to link them.
- Cash back will be credited to your brokerage account monthly.
- Invest the proceeds, or access your cash back by check or debit card.
Credit Card Details
- No annual fee.
- 2% cash back on everything, with no cap.
- Card is issued by FIA, which is part of Bank of America.
Brokerage Account Details
Brokerage Minimum. When you open the Schwab credit card (or a high yield investor checking), there is no minimum on the brokerage account. Otherwise the minimum is $1,000.
Fees. There are no monthly fees for the brokerage account.
Accessing Cash. According to Schwab, you can “Access your money easily with fee-free checking, a Visa check card, online bill pay and fund transfers.” I plan to move my money directly to our checking account with Schwab, which is our primary checking account.
Even though we have an old 2% cash back credit card that deposits into our 529 plan, I’m planning to apply for this card. It’s always good to have a back up with the rapidly changing credit card environment.
In addition, it’ll be a nice way to transfer money since we already have our checking account at Schwab, and a portion of my Roth IRA since they announced the lower expense ratios.
Here are even more cash back credit cards for you to check out.
Good to know of other rewards that yield a great cashback incentive. I moved all my Wells Fargo accounts when I refinanced to get the lower rates are available now, but I have been looking for a new rewards card. I currently use my Wells Fargo VISA, which yields 1 to 1.2% cash back depending on which level I redeem for the cashback ( I avoid their reward items to choose from because I can get those items cheaper with the cashback option. The one benefit that this card has that I enjoy is the price protection. If I find an advertised price with a lower purchase price within 6 months (I think that time frame is correct), then I can file a claim form, attach a copy of receipt, and the print ad and get a check for the difference. Do youknow of any cards with that feature. I have used it a few times (especially around Black Friday)?
I also have had a Schwab One brokerage account for many years, have an IRA with them and my work’s 401K, and had seen this credit card offer on their site. However, it turns out that when I applied, they decided I had too much outstanding debt (due to credit card arbitrage – all at 0-3% interest). My credit score is high, and in the past getting a new card would have been easy. Now banks are reviewing their portfolios and deciding they have too much risk (don’t we all know that!)
So in my case it did not work. Good luck to others who want to try! I think if people have a good score and don’t carry too much debt, it may work out better than me.
I’m actually confused by how I can access the cash back. It said it’s deposited to the brokerage account, and can be accessed with a debit card?
Is there a fee if I want to transfer the money in the brokerage account to another Schwab checking account? Thanks!
Even though we have an old 2% cash back credit card that deposits into our 529 plan,
whats that old card
It’s the Fidelity Investments 529 College Rewards Platinum Plus MasterCard.
It links to the New Hampshire 529 plan. I can’t remember exactly how long ago I got it, but it was before I had kids, so I’ve had it for at least 6 years.