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A lot of the credit card hype in recent years has come from premium cards like the Chase Sapphire Reserve or The Platinum Card from American Express that offer outsized value through a suite of luxury perks like travel credits, lounge access and elite status, but also carry annual fees of $450 or more.
Yet one of the cards that’s excited me the most in recent years is a hard hitter with a modest annual fee that manages to deliver all the right benefits at the right price. The Bank of America Premium Rewards Card is worth a look thanks to its flexible redemption options and high earning rates if you’re able to take advantage of BoA’s Preferred Banking Rewards Program.
Who Is This Card For?
This card is perfect for both points and miles experts and complete beginners. Cash back rewards can be a great compliment to a well developed points strategy, especially to help you jump on extreme fare sales or offset taxes on award tickets or resort fees. At the same time, the simplicity of cash back rewards takes a lot of stress out of the game. There’s no agonizing over scoring the perfect redemption since your points are worth a fixed one cent each. So go ahead and cash them out to fund your next vacation, buy a new TV, or whatever else you like.
This card also has broad appeal to people looking for a new everyday spending card (https://thepointsguy.com/guide/best-credit-cards-everyday-spending/) after the SPG Amex earning rate devaluation. You’ll earn a minimum of 1.5% back on all your purchases, or potentially as much as 2.62% back for members of the Preferred Rewards Program.
Sign-up Bonus
The Premium Rewards card is offering a bonus of 50,000 points after spending $3,000 in the first 90 days after account opening. With points worth a fixed one cent each, that comes out to $500, a very solid bonus for a cash back card.
But it gets even better than that. While the card carries a $95 annual fee, it also comes with a $100 annual airline incidental credit (more on that later). This means that in addition to your sign-up bonus, BoA is essentially paying you $5 every year you keep the card open.
Earning
Don’t let the terminology confuse you- even though your sign-up bonus comes in the form of 50,000 ‘points’ this really functions like a traditional cash back card, with points worth a fixed one cent each.
Even though I’m The Points Guy, cash back has gotten more appealing to me in recent years as airlines continue to devalue their award charts and limit the amount of saver level award space they release.
The BoA Premium Rewards card offers 2x miles (2% back) on travel and dining purchases, and 1.5x on all other purchases. But members of the Preferred Rewards program will earn at much higher rates. To enroll in Preferred Rewards, you must meet have:
An eligible Bank of America personal checking account AND a 3-month average combined balance of $20,000 or more in a Bank of America account and/or Merrill Edge or Merrill Lynch investment accounts.
Depending on the total value of your account balances, you’ll earn at the following rates:
| Spend Categories | Regular Cardholder | Tier 1 – Gold ($20,000 – $50,000) | Tier 2 – Platinum ($50,000 – $100,000) | Tier 3 – Platinum Honors ($100,000+) |
|---|---|---|---|---|
| Travel/Dining Earnings | 2x points | 2.5x points | 3x points | 3.5x points |
| Other Earnings | 1.5x points | 1.875x points | 2.25x points | 2.62x points |
It’s great to see BoA rewarding their loyal banking customers with higher bonus categories, and if you already bank with BoA this card is a no-brainer. Even if you don’t, it might be worth establishing a relationship with them. A “free” (after the travel credit) cash back card that earns a minimum of 2.6% on all purchases is unbeatable, and has earned this card a coveted spot in my wallet.
Redeeming
The greatest benefits of cash back rewards often come on the redemption side, with a simplicity that valuable transferable points just can’t match. Since points are worth a fixed one cent each, you can go ahead and cash them out whenever you want as long as you have 2,500 ($25) or more to redeem. You have a few different options for how to redeem your rewards:
- Cash back, in the form of a statement credit or a deposit into an eligible BoA checking or savings account, Merrill Lynch of 529 college savings plan.
- Travel purchases. You can use your points to book flights directly through the BoA travel portal.
- Gift cards.You can redeem your points for gift cards to popular retailers including Amazon and Starbucks.
No matter what you plan on using your rewards for, I strongly suggest taking them in the form of cash back. Even if you want to book travel or buy gift cards, you should put those charges on a credit card to keep earning more points and use the cash back to pay the bill.
Fixed value points are both a blessing and a curse. While there’s no fun to be had in finding better value redemption options, there’s also no stress involved. I can cash out my rewards as often as I want and get them working for me again.
Perks
The Premium Rewards card comes loaded with a surprising number of perks for an entry level credit card. Here are a few of my favorites:
$100 Airline Incidental Credit.This is the most important perk by far as it more than negates the $95 annual fee, and leaves you getting paid $5 a year to keep this card open. Similar to the credits that come with the Amex Platinum, this can’t be redeemed directly for the cost of airfare. Instead, it will be automatically applied to eligible charges for seat assignment, checked bag fees, lounge access, and more.
Global Entry / TSA PreCheck Application Fee Credit: I shudder to think just how many hours of my life Global Entry has saved by rushing me through expedited customs screening. While most people will have access to this perk from other credit cards (it’s becoming almost laughably commonplace these days), remember that you can gift it to friends or family members! If you pay for their application fee, you’ll be reimbursed as if it was your own. It’s a little surprising to see this perk offered by a non-premium credit card, but just another reminder of how committed BoA is to offering a quality product at an affordable price.
Trip Insurance: Trip insurance is one of those perks you hope to never have to use, but once you have, you can’t travel without it. The Premium Rewards card provides reimbursement of up to $5,000 per person, per trip for unused, prepaid, non-refundable travel expenses including, tours, airfare and hotels if you have to cancel due to a covered reason. If your flight is delayed more than 12 hours, you’ll also be eligible for reimbursement of $500 per ticket.
Baggage Delay/Loss Insurance: If your bag is delayed by more than six hours, you’ll be eligible for up to $100 in reimbursements per day (up to 5 days). If your bag is lost or stolen, you can be reimbursed for the contents of the bag.
Purchase Protection: For purchases made with your Premium Rewards card, you can be reimbursed up to $10,000 to repair or replace lost or damaged items. You can even be reimbursed up to $250 for returns made within 90 days that aren’t accepted by the retailer (up to $1,000 annually).
Rental Car Insurance: While not as strong as the insurance policies offered by many Chase cards, you will enjoy secondary rental car insurance. This means when filing a claim this will only kick in after or in excess of your personal policy.
Which Cards Compete With The Premium Rewards Card?
As a mid-tier credit card, the Premium Rewards card appears to be a natural competitor to the likes of the Chase Sapphire Preferred and Citi ThankYou Premier, but its cash back earnings really help it stand out. All 3 cards offer relatively similar sign-up bonuses, and while transferable points are more valuable than the 1 cent point you’ll earn with BoA, the Premium Rewards card wins handily on perks thanks to the $100 airline incidental credit and Global Entry fee credit.
| Card Features |
Bank of America Premium Rewards |
Chase Sapphire Preferred | Citi ThankYou Premier Card |
| Annual Fee | $95 | $95 | $95 |
| Sign-Up Bonus | 50,000 points | 50,000 points | 50,000 points |
| Spending requirement | $3,000 | $4,000 | $4,000 |
| Airline Credit | $100 | $0 | $0 |
| Global Entry Credit | $100 | N/A | N/A |
| Travel earnings | 2x — 3.5x points | 2x points | 3x points |
| Dining earnings | 2x — 3.5x points | 2x points | 2x points |
| Other purchases | 1.5x — 2.625x points | 1x points | 1x points |
Bottom Line
This card is not the answer if you’re looking for extravagant flight redemptions like Singapore’s new Suites class. It’s really about diversifying your rewards strategy and getting access to some valuable cash back for the taxes tours and trips where points can’t help you.
This card should be on everyone’s radar. If you’re able to join the Preferred Rewards program, this becomes one of the most valuable cash back cards on the market and an absolute no-brainer. Even if you can’t, the solid bonus categories and the fact that you get paid $5 to keep this card open are enough to convince me. Add in the $500 sign-up bonus, valuable travel perks, and long term earning potential, and this card almost sounds too good to be true.
