Bank of America, Chase, Credit Card Points (Chase/Amex/Citi)

Bank of America’s new Premium card can hit 3.5% cash back – so am I excited?

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More details emerged today about the new “premium” Bank of America Premium Rewards card.

What we already knew: $95 annual fee. 50,000 points signup bonus (worth $500) for spending $3,000.

New details:  Travel and dining will earn 2 points per dollar; everything else 1.5 points per dollar.

The interesting part:  Based on your BofA bank balance, you earn more points as follows:

  • Balances over $20,000 and under $50,000 earn a 25% bonus on all points
  • Balances from $50,000 to $100,000 earn a 50% bonus on all points
  • Balances over $100,000 earn a 75% bonus on all points.

What does the equate to in points accrual?

  • $20,000-$50,000 tier: 2.5% back on travel and dining and 1.875% on everything else
  • $50,000-$100,000 tier:  3% back on travel and dining and 2.25% on everything else
  • $100,000+: 3.5% back on travel and dining and 2.6% back on everything else

Depending on your spend habits, this becomes somewhere in the neighborhood of a 3% cash back credit card (as long as you redeem for travel) if you have a $100k balance.

If we look at this as a cash back card, it is competing against the Alliant 2.5% cash back card and the Citi DoubleCash which gives 2% cash back. These are both straight cash back. No need to have travel spending to redeem.

But if we look at this as a points-earning credit card, we have to compare it against the Chase Sapphire Reserve / Chase Freedom Unlimited combo.  When redeemed for travel, you are earning 4.5% cash back when used for travel and 2.25% cash back on everything else.

So, it looks like it’s about a wash in terms of point value, right?

Nope.

Because with Chase, you have a sweet list of transfer partners with which you extract much greater value.  And if you like to fly first or business class, Chase becomes a clear winner because of those transfer partners.

Bottom line: 

I find this card interesting from the standpoint of offering better rewards to BofA’s better customers and like the angle.  If you never transfer points and just like to redeem for travel, this card is certainly worth a look – at a minimum for the $500 signup bonus.  If you redeem that way, then it’s basically on par with Chase.

As well, perhaps you are over 5/24 with Chase and you can’t get the Reserve. In this case, this new Bank of America Premium Rewards card is a solid next best thing.

Will you apply for this card?  Let me know in the private MilesTalk Facebook group or in the comments.

As a reminder, you can always view all of our current credit card signup bonus offers here.