In the interest of full disclosure, One Mile At A Time earns a referral bonus for anyone that’s approved through some of the below links. These are the best publicly available offers that we have found for each card. Please check out our advertiser policy for further details about the partners we work with. Thanks for your support!
It’s now possible to apply for the Bank of America Premium Rewards Credit Card. While the card has “premium” in the name, it’s not actually intended to compete with $450-550 annual fee cards like The Platinum Card® from American Express, but rather is intended to compete with mid-range cards with $95 annual fees, like the Chase Sapphire Preferred® Card.
Let’s look at the details of the card, and whether or not it’s worth applying for?
Bank of America Premium Rewards Card sign-up bonus
The card offers a sign-up bonus of 50,000 bonus points after spending $3,000 within three months. Points can be redeemed for a penny each as a statement credit, so the 50,000 points are worth $500.
Bank of America Premium Rewards Card annual fee
The card has a $95 annual fee, which isn’t waived the first year.
Bank of America Premium Rewards Card perks
The card offers two main perks to help offset the annual fee:
- You get a $100 airline incidental statement credit annually for qualifying airline purchases, which is automatically applied to your statement; if you are able to use that every year and value it at close to face value, that basically wipes out the annual fee on the card
- You get a $100 TSA Pre-Check or Global entry application fee credit every four years
Typically this is a benefit you only see with higher annual fee cards, so that’s a nice benefit on a mid-range card like this.
The other perk is that the card has no foreign transaction fees, though that’s not exactly special anymore.
Bank of America Premium Rewards Card ability to redeem points
As I said above, points are worth a penny each, so while you can choose whether you want them as a statement credit or in your Merrill Lynch account, it doesn’t change the amount you get back. There are no transfer partners or any other ways to redeem these points.
Bank of America Premium Rewards Card bonus categories
This is where the card falls flat. The card offers:
- 2x points for every dollar spent on dining and travel
- 1.5x points for all other spend
That’s not terribly lucrative, since you’re earning at best 2% cash back. With a return like that, you’re much better off with the Citi® Double Cash Card, which offers unlimited 1% cash back when you buy, plus an additional 1% as you pay for those purchases. The card has no annual fee, and you’re earning the best return offered by the Bank of America Card on all your spend.
The one thing that potentially makes the Bank of America Premium Rewards Card worthwhile
Up until now, just about everything about this card makes me ask “why bother?” Well, there’s one thing that could potentially make this card very worthwhile. If you’re part of Bank of America’s Preferred Rewards program, you’re eligible to earn additional points based on how much you have deposited with them:
- If you have $20,000-49,999 in assets, you earn 2.5x points on dining and travel, and 1.875x points on everything else
- If you have $50,000-99,999 in assets, you earn 3x points on dining and travel, and 2.25x points on everything else
- If you have $100,000+ in assets, you earn 3.5x points on dining and travel, and 2.625x points on everything else
This card potentially starts to make a lot of sense if you’re in that top category. This is the equivalent of earning 3.5% cash back on dining and travel, and 2.625% cash back on all other purchases. That’s arguably the best return on non-bonused spend offered by any credit card, with the exception of The Blue Business℠ Plus Credit Card from American Express, which offers 2x Membership Rewards points on the first $50,000 spent annually. Of course you need to have $100,000+ with them, which is a pretty important detail.
The new Bank of America Premium Rewards Credit Card isn’t bad, but for the average person I don’t see a reason to switch to it. If it’s cash back you’re after, the Citi® Double Cash Card is more compelling. If it’s points you’re after but you don’t want to pay more than $100 worth of annual fees, I think the combination of the Chase Sapphire Preferred® Card and Chase Freedom Unlimited®, or just The Amex EveryDay® Preferred Credit Card from American Express, are significantly more compelling.
The one exception is if you’re eligible for the highest tier of the Preferred Rewards program, in which case this card could offer up to 3.5% cash back on travel and dining purchases, and 2.625% cash back on everything else. That’s potentially very interesting.
What do you make of Bank of America’s new Premium Rewards Card?
(Tip of the hat to View from the Wing)