The Bank of America Customized Cash Rewards card lets you choose a 3% cashback category that matches your spending.
Selecting the right category directly affects how much value you earn each quarter.
This guide shows you how to choose strategically to maximize rewards based on your actual expenses.
Understanding How the 3% Category Works
The Bank of America Customized Cash Rewards card lets you select one 3% cashback category based on your spending needs.
You can adjust this setting to increase your earnings each quarter.
- One Selectable 3% Category: You choose one bonus category at a time. This controls where you earn the highest rewards.
- Eligible 3% Categories: Options include gas, online shopping, dining, travel, drug stores, and home improvement. Selection is made in online banking.
- Quarterly Spending Cap: The 3% and 2% rates apply to the first $2,500 in combined purchases each quarter. After that, purchases earn 1%.
- 2% Grocery & Wholesale Clubs: Grocery and wholesale club purchases earn 2%, within the same $2,500 quarterly cap.
- 1% Base Rewards: All other purchases earn unlimited 1% cashback.
- Monthly Category Changes: You can switch your 3% category once per calendar month. This helps you plan around major expenses.
Full List of Available 3% Categories
The 3% category options let you earn higher rewards on your biggest spending areas. Pick the one where you spend the most to maximize your cashback.
- Gas & EV Charging: Earn 3% on fuel and electric vehicle charging. This works well if you drive often.
- Online Shopping: Earn 3% on purchases made online. Good for frequent e-commerce users.
- Dining: Earn 3% at restaurants and eateries. This includes sit-down and quick-service meals.
- Travel: Earn 3% on travel purchases. This typically includes flights, hotels, and qualifying travel services.
- Drug Stores: Earn 3% at drug stores. This covers prescriptions and everyday pharmacy purchases.
- Home Improvement & Furnishings: Earn 3% on home improvement and furnishing purchases. This is useful if you buy tools, decor, or appliances.
Step 1 – Analyze Your Monthly Spending
Before selecting your 3% category, review how you actually spend. Your goal is to choose based on real data, not assumptions.
- Review Past Statements: Check the last 3 to 6 months of transactions. Identify where most of your money goes.
- Identify Top Categories: Group your expenses into gas, dining, online shopping, travel, and others. Look for the highest total.
- Focus on Consistent Spending: Prioritize categories you use every month. Avoid choosing one-time expenses.
- Separate Essentials vs Extras: Determine which expenses are recurring and predictable. This helps you pick a stable bonus category.
- Estimate Quarterly Totals: Calculate how close your spending gets to the $2,500 quarterly cap. This prevents underusing the bonus.
Step 2 – Match the Category to Your Lifestyle
After reviewing your spending, align your 3% category with how you live and spend daily. Choose the category that reflects your consistent habits.
- Daily Commuter: If you drive regularly, select Gas & EV Charging. This maximizes rewards on routine fuel costs.
- Frequent Online Shopper: If most purchases are made through e-commerce platforms, choose Online Shopping. This captures regular digital spending.
- Regular Diner: If you eat out often, select Dining. This works well for consistent restaurant expenses.
- Frequent Traveler: If you book flights, hotels, or rental cars several times a year, choose Travel. This helps offset trip costs.
- Homeowner or Renovator: If you spend on tools, furniture, or upgrades, choose Home Improvement & Furnishings. This supports project-based spending.
Step 3 – Plan Category Changes Around Big Purchases
You can change your 3% category once per calendar month. Use this flexibility to prepare for planned high-value spending.
- Switch Before Major Expenses: Change your category before large travel, renovation, or online purchases. This ensures the expense earns 3%.
- Leverage Seasonal Spending: Adjust your category during holidays, travel seasons, or sales events. Match the bonus to peak spending periods.
- Monitor the $2,500 Quarterly Cap: Time large purchases early in the quarter to fully benefit from the bonus rate. Avoid hitting the cap too late.
- Set Monthly Reminders: Schedule a reminder to review and update your category. This prevents missed reward opportunities.
Understanding the Quarterly Spending Cap
The 3% and 2% bonus categories are limited by a combined quarterly spending cap. You need to track this limit to avoid earning a lower rate.
- $2,500 Combined Limit: The 3% and 2% categories apply to the first $2,500 in combined purchases each quarter.
- 1% After the Cap: Once you exceed $2,500, all purchases earn 1% for the rest of the quarter.
- Cap Resets Each Quarter: The spending limit resets every calendar quarter. Your earning potential starts fresh.
- Track Progress Regularly: Monitor your spending through online banking. This helps you avoid reaching the cap too early.
- Plan High-Value Purchases Carefully: Spread large expenses across quarters if possible. This keeps your 3% rate active longer.
Leveraging Preferred Rewards Boost
If you qualify for the Bank of America Preferred Rewards program, your cashback rate can increase beyond the standard 3%.
This bonus can significantly improve your overall return.
- Tier-Based Bonus Structure: Preferred Rewards provides bonus tiers based on your eligible account balances. Higher tiers give larger reward boosts.
- Cashback Multiplier Increase: Your 3% category can increase by 25%, 50%, or 75%, depending on your tier. This raises your effective cashback rate.
- Qualification Requirements: Eligibility depends on maintaining a minimum average balance across qualifying accounts.
- Long-Term Optimization: Keeping assets within eligible accounts helps you maintain your tier and maximize rewards consistently.
- Higher Effective Return: At the top tier, your 3% category can effectively earn up to 5.25%. This makes strategic category selection even more valuable.
Advanced Multi-Card Strategy
Using the BoA Customized Cash card alongside other rewards cards can increase your total cashback.
You can assign each card to a specific spending purpose to maximize returns.
- Pair with a Flat 2% Card: Use a flat-rate card for purchases outside your 3% category. This keeps your overall return stable.
- Use a Grocery-Focused Card: Since groceries earn 2% with the Customized Cash card, a dedicated grocery card may offer higher returns.
- Separate Travel Spending: If you travel frequently, consider a travel rewards card for flights and hotels, while using 3% for other categories.
- Avoid Category Overlap: Make sure each card serves a clear role. This prevents missed rewards or confusion.
- Track Spending Carefully: Monitor which card you use for each purchase. Organization is key to maximizing benefits.
Who Benefits Most from This Strategy
This 3% category strategy works best if you actively manage your spending. You benefit most when your expenses are predictable and organized.
- Organized Budget Planners: If you track your monthly expenses and review statements regularly, you can optimize your category selection.
- High Category Spenders: If one category consistently accounts for a large share of your spending, you can maximize the 3% rate.
- Commuters and Frequent Shoppers: If you regularly spend on gas, online shopping, or dining, this structure can generate steady cashback.
- Preferred Rewards Members: If you qualify for the Bank of America Preferred Rewards program, you can increase your effective cashback rate further.
- Strategic Card Users: If you use multiple cards for different expenses, you can combine strategies to increase total rewards.
Final Recommendation
Choosing the right 3% category on the BoA Customized Cash card can significantly increase your cashback when it aligns with your real spending habits.
Review your expenses regularly and strategically adjust your categories to stay within the quarterly cap and maximize returns.
Log in to your Bank of America account today and update your BoA Customized Cash 3% category to match your highest spending area.
Disclaimer
Rates, rewards structures, and category options for the BoA Customized Cash card may change at any time, subject to issuer policies.
Always review Bank of America’s official terms and conditions before making financial decisions.
