USAA Updates – New Checking Accounts and More 2.5% States

One New Name and One New Checking Account

In late January, I noticed something different about my USAA checking account. Instead of being called “Secure” checking, it’s now called a “Classic” checking account. There’s obviously some reason why they made the change after so many years, so I did some research.

Turns out USAA renamed it because they’re revamping their checking account options to include a cashback checking account. All old Secure checking accounts have been renamed Classic, but there doesn’t seem to be any real difference besides the name. In addition, USAA launched a cashback checking account, the appropriately named “USAA Cashback Rewards Checking”. It’s apparently been live since sometime in December, but it’s only available to a number of states while the program is still in its pilot stages (discussed below).

I’ll be blunt – it’s a watered down version of Discover’s checking account. Discover’s checking account is already a scotch and water, emphasis on the water, so that should tell you how bad this is. With the USAA cashback checking account, for every transaction of $1 or more with the debit card, you’ll earn $0.10. That’s it.

What’s worse is that the cashback checking account is lacking in some actually useful features. Accounts don’t earn interest, and you won’t get any ATM fee rebates. Granted, the interest rate on the Classic checking account (and the savings account, to be honest) blows, and you’re limited to $15 in ATM fee rebates per month, but it was still nice to have. Assuming an ATM fee of $5, you’d need to make 50 transactions with the debit card of over $1 to even match one ATM fee rebate. I don’t see this as being useful in any but the most abstract situations.

The checking account is only available in the same states as the credit card (discussed below). An interesting thing is that it’s actually possible to convert an existing Classic checking account into a Cashback one instead of needing to apply for it anew. This is interesting given USAA’s policy of not allowing account conversions for credit cards (which is complete crap for entirely different reasons).

 

Limitless Card Available in More States

In other news, the 2.5% cashback credit card is now available in AL, AZ, CO, GA, HI, ID, IL, IN, KS, LA, MI, NM, NV, NY, PA, RI, SC, TN, TX and WA (shown at top). Still no love for me in Florida, although I’m not sure I would even want to MS on this card given my history with USAA. For those that don’t want to read that, take note that one of the things they accused me of doing after they had [supposedly permanently] shutdown my accounts was abusing the credit card rewards program. The activity they were talking about had happened more than nine months before, and it had literally never been brought up in any previous conversations about my shutdown. Just take that as a warning.

 

Summary

The 2.5% card is now available in 20 states. They’re still on track to have it available in all states by the end of 2017. This target date is mentioned in various official statements by USAA, and they seem to be holding to it.

Old Secure checking accounts have been rebranded Classic, and there’s a cashback checking account. It only earns $0.10 per debit card transaction over $1, so it’s totally not worth it.