The United Airlines MileagePlus GO Prepaid card is now live. Almost. Maybe. A website for the product is live but applications are not yet available. Presumably that will be resolved soon. But even without the ability to apply there are some details available about how the card will work, what it will cost and what you can earn.
The MileagePlus GO Visa Prepaid Card is issued by Republic Bank & Trust Company and is, generally speaking, just another debit card. Unlike most debit cards, however, this one comes with an $85 annual fee to offset the points earning capability it presents. Consumers can earn 1 MileagePlus point per dollar spent on the card, up to 2,500 points each month. Also, only “signature purchases” (a/k/a “credit”) count towards points earning. This excludes PIN-based transactions (a/k/a “debit”) as those are priced differently to the merchant, effectively taking away the margin the bank earns on the deal that covers it buying points from the program to pay out to the consumer.
The GO prepaid card also includes an interesting feature for the cash balance awaiting your spending: It pays interest, and at a decent rate, too. The first $1000 of balance on the card will earn at a 5% APY. Anything over $1000 pays only 0.5% APY. The card carries a 3.5% foreign transaction fee, ATM usage fees (unless in MoneyPass Network ATMs) and a $9.95 charge to replace a lost/stolen/damaged card. Also, no interest fees on transactions which sounds awesome until you realize that you have to park money in the account in advance; insufficient balance means transaction denied. And the 5% APY doesn’t make up for leaving that money in the prepaid account.
So, who should get this card??
No one. Absolutely no one. The card is a bad deal. You should not get it.
The $85 annual fee is only $10 less than the MileagePlus Explorer Credit Card. And for saving that $10 you get a significantly reduced earning potential and none of the other ancillary benefits that come with the credit card. No free checked bag. No priority boarding. No increased award availability, but that’s probably okay because the card also comes with strict caps on earning potential. It will be hard to generate sufficient points to redeem for “big” rewards through the MileagePlus GO Visa Prepaid Card.
Okay, so not everyone can get the premium card. That’s usually because of credit score issues. Consumers in that boat should be working on improving their credit score and doing so with products that carry a significantly lower set of fees than this does.
The points game/hobby/economy/whatever you want to call it is amazing. It drives people to spectacularly inefficient or irrational spending behaviors. That’s great for the marketing teams and awful for consumers. Don’t get caught in this one.
Header image: Inside the new United 777-300ER Polaris Cabin, award seats that this card will almost certainly not open up for consumers.
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