Wells Fargo has had a bit of a rough run over the last year. To counter that they've started to offer some attractive perks on their credit cards to help attract some new customers. The Cash Wise offers some unique benefits that are likely to appeal to millennial consumers that have a love/hate relationship with their phone. For example, if you love to drop your phone and hate to keep a case on it then this card's $600 cell phone insurance (with a $25 deductible) might be a good fit for you. The card also offers a 12 month introductory APR period on purchases and balance transfers for anyone looking to make a major purchase in the near future or help reduce the interest expense of carrying a balance on an existing card. These perks are all bundled up in a card that comes with a $0 annual fee. The real question at hand is should you open a Wells Fargo account before they open one up for you?
This card is a bit ho-hum when it comes to everyday earning. You'll get a flat 1.5% cash back on your everyday purchases. There are a handful of other credit cards that offer a 1.5% cash back earning rate with a smaller group earning a flat 2%. This card does offer a unique feature for the first year where you'll earn 1.8% cash back on mobile wallet payments. This is a great move for Wells Fargo, as it requires you to add their card to your mobile wallet, which is becoming a coveted spot for financial institutions. As we move away from plastic (or metal) credit cards, banks will be paying more attention to your digital wallet to ensure that you don't forget to use their card at checkout.
In addition to your annual cash back earnings which we'll cover a bit more in a second, you'll also receive a new customer bonus of $200 when you make $1,000 in purchases in your first 3 months of account opening. Cha-ching. For your first year estimated earnings, we're going to assume you'll spend $1,000 a month on your card, with $400 of that being used at stores that accept mobile wallet payments. This earnings estimate will vary depending on your actual spending habits, of course.
Using these assumptions, you will earn $194.40 in cash back your first year on spending, plus an additional $200 as a new customer for a grand total of $394.40. Once the intro perks fall off in year 2, you can expect to earn about $180 a year. After year one, it might be worth regrouping with Wells Fargo to review your spending habits to see if they have another product that may be more rewarding for you.
People that drop their phones and like a steady 1.5% cash back. There are certainly cards on the market that will earn you a higher rewards rate, but at what cost? About $575 if you break your phone. ($600 - your $25 deductible.) The rewards structure is also decent for someone that doesn't want to bother tracking special categories that change month to month for increased earning opportunities.
Frequent travelers. If you travel 2-3 times a year we'd suggest you go for a product that has more travel perks built in to it. For a flexible rewards card, we'd go with the Citi ThankYou Premier. On the flip side, if you are carrying balances month to month with no end in sight, we'd recommend focusing on paying those bad boys down before worrying about earning any cash back. The Wells Fargo Visa Platinum Card will provide a longer 15 month intro APR period to help you save on existing balances, and still provide you with the cell phone protection your clumsy hands desire.
This is a fairly well rounded card that will serve you well in your first year of card membership. Sure, there are cards that earn 2% cash back on everyday purchases, but those rarely come with a welcome offer. We say take the plunge if you're interested in the cell phone protection benefits and can live with the 1.5% cash back earning rate. That opportunity cost will set you back around $60 for the year as you enter into year two, so you may want to take a look at your spending habits to see if there is an upgrade option for you at that time. Wells Fargo offers some other well rounded rewards cards that might be a good fit, and hey you'll already have a foot in the door!