The Bank of America Premium Rewards Card is a solid alternative to transferrable points earning cards. This is especially true if you have over $50,000 in cash and investments in a Bank of America (BOFA) account. This grey card from Bank of America has a $95 annual fee (NOT waived the first year). And it can be very lucrative for those who want to keep earning simple.
To start, the Premium Rewards Card has a sign-up bonus worth 50,000 points or $500. This bonus can be earned after spending $3,000 in the first three months. This is a nice bonus with a decent minimum spend for a Tier III card.
But the actual earning is where the Premium Rewards card shines. It earns 2x points on all Travel and Dining purchases as well as 1.5x points for all other spend. The Premium Rewards’ earning structure is like a combination of the Chase Sapphire Preferred and Chase Freedom Unlimited. The Travel and Dining categories are also very broad, like those from Chase.
While it’s a nice structure for all cardholders, it’s even better if you bank with BOFA.
Bank of America Preferred Rewards Program
BOFA has their Preferred Rewards Program, which increases rewards earned on BOFA credit cards. Those with BOFA accounts will see their rewards increase by a certain percentage depending on how much they have in their account. If a cardholder has multiple accounts, the bank takes the total amount in all accounts to determine the percentage.
Use the following table to determine your percentage and revised multipliers:
|Level||Minimum Amount Required||Percentage||2x Travel & Dining||1.5x Non-Bonus Spend|
|Platinum Honors Preferred||$100,000||75%||3.5x||2.625x|
Having a bank account (or several) with BOFA is nice. You receive a 10% points bonus simply by having any bank account with BOFA. Those with accounts will earn 2.2x points on Travel and Dining and 1.65x points on non-bonus spend.
However it’s at the Platinum Preferred level where the rewards for all types of spend outweigh a 2% cash back card. To get to this level, you need $50,000 total in your BOFA account(s).
Still, there are many transferrable points cards that offer higher multipliers for travel and dining without the five-figure requirement. If you like a certain issuer’s transfer partners, that issuer’s “ecosystem” might be worth looking at instead.
The Premium Rewards Card is what’s called a “travel cash back card”. This means that points earned are worth one cent apiece and there are no transfer partners. I usually view cards like this one as cash back cards because they’re similar.
Cash Back & Investment
This is the simplest way to redeem your points. Points can be redeemed as a statement credit or deposited into a BOFA account. I would choose the latter option because you can invest the cash back in a 529 Savings Account or any Merrill Lynch or Merrill Edge account.
However, there are some travel purchases that cannot be paid for with transferrable points. I suggest having a small balance of cash back to pay for these special purchases. Helicopter rides and museum tours are great examples.
Bank of America Travel Portal
This option is great if you want to book travel. However, its known to be expensive compared to the carrier or hotel’s direct website. I suggest pricing around before using the portal.
Redeeming for gift cards is another option. But its not the smartest one because your points will go a longer way with investing or even the travel portal.
The BOFA Premium Rewards Card offers several hundred dollars’ worth of benefits to offset its $95 annual fee. It can be a “long term keeper card” for some people, especially those in the BOFA Preferred Rewards Program.
$100 Airline Credit
This credit is nice for incidentals, seat upgrades, baggage fees, and other airline-related expenses that are not tickets. It’s very similar to the credit offered with the American Express Gold Card.
$100 Global Entry / TSA Pre-Check Credit
This credit is ubiquitous among premium cards and is starting to become more common with mid-tier cards. The Premium Rewards Card is no exception and it offers the credit every 4-5 years, depending on the service you select.
The Premium Rewards Card comes with Trip Delay / Cancellation Insurance. This is nice if you must cancel a trip for some reason. Each person who was supposed to go on the trip will be reimbursed up to $5,000. This money would have been spent on unused and prepaid travel expenses. Furthermore, if your flight is delayed at least 12 hours, you will be given up to $500 for ticket reimbursements.
This card also comes with Baggage Loss / Delay Insurance. You will be reimbursed for the contents of your luggage if its lost, damaged, or stolen. And, if your bags are delayed at least six hours, you will be reimbursed $100 per day (for up to five days).
No Foreign Exchange Fees
This increasingly common benefit saves you 3% on all purchases made outside of the United States.
Check out the following cards if the BOFA Premium Rewards Card is not right for you:
Chase Sapphire Preferred
This mid-tier card from Chase has the same exact bonus categories as the Premium Rewards Card. But the Sapphire Preferred earns Chase Ultimate Rewards (UR) points and only one per dollar for non-bonus spend.
The major draw of this card is its transfer partners and membership in the Chase UR “ecosystem”. When paired with other UR-earning cards, the Sapphire is one of the best in the industry. Furthermore, the Sapphire Preferred requires $4,000 minimum spend for a bonus worth 60,000 UR points. The potential of UR points makes this bonus worth way more than the BOFA card’s $500 bonus.
Barclaycard Arrival +
The British bank’s flagship travel card is also a “travel cash back card”. However, it earns 2x points for every dollar spent and has an $89 annual fee. Barclays does not have a bonus program like the BOFA Preferred Rewards Program. But the Arrival + has the better non-bonus rate if you have less than $50,000 in a BOFA account.
The Arrival + has a sign-up bonus worth 70,000 miles (or $700). It can be earned after spending $5,000 in the first three months. This is a whole $200 more than the BOFA card’s bonus. However, you must spend another $2,000 to earn the bonus.
The Bank of America Premium Rewards Card is a great alternative to transferrable point and cash back cards for travelers. It has a $95 annual fee (NOT waived the first year) and some nice travel-related benefits comparable to other mid-tier cards.
The earnings become very enticing if you’re part of the BOFA Preferred Rewards Program, especially at the Platinum Preferred level or higher. If you have at least $50,000 saved, invested, or waiting in a retirement or education fund, moving to BOFA and getting this card might pay off big time.