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Today, TPG Contributor Nick Ewen takes a look at a new offer for the BankAmericard Travel Rewards® Credit Card.
I love when credit cards that usually fly under the radar improve their benefits or enhance their sign-up bonuses in an effort to appeal to more customers. One such card has just announced a change along these lines: Beginning this week, the BankAmericard Travel Rewards® Credit Card is offering a new sign-up bonus of 20,000 points after you spend $1,000 on the card within 90 days of opening the account — that’s worth a $200 statement credit toward almost any travel purchase.
This new bonus is a step above the past sign-up bonus on this card, which was 10,000 points after making $500 in purchases. While the new bonus has a higher minimum spend requirement, the extra points are more than worthwhile. $1,000 spread out over 90 days is only $334 per month (or just over $11 per day), so even the most casual credit card user should have no trouble earning the bonus.
The sign-up bonus is one of the most attractive components of the card, but let’s take a closer look at the other key benefits to see if it’s worth adding to your wallet:
The card offers a solid everyday earning rate of 1.5 points per dollar spent on all purchases. Since these points are worth 1 cent apiece toward travel, you’re essentially getting a 1.5% return on every transaction.
This earning rate is even better if you’re an existing Bank of America customer. Any cardholder who also has an active Bank of America checking or savings account will receive an additional 10% bonus on every purchase, bumping the return up to 1.65%. The card is also eligible for the bank’s relatively new Preferred Rewards program, which offers larger bonuses for certain Bank of America, Merrill Lynch and Merrill Edge customers. If your balance (based on a three-month combined average) exceeds a certain amount, you can earn the following:
- Gold ($20,000 – $50,000) earns a 25% bonus, increasing your return to 1.875%
- Platinum ($50,000 – $100,000) earns a 50% bonus, increasing your return to 2.25%
- Platinum Honors ($100,000+) earns a 75% bonus, increasing your return to 2.625%
These bonuses are in place of the 10% bonus for checking and savings account holders, but still offer a solid additional return on your everyday purchases.
Finally, the card also offers 3 points per dollar when you make travel purchases through the Bank of America Travel Center. This adds an extra 1.5% return to the above rates.
As stated above, the sign-up bonus is worth a $200 statement credit toward travel purchases, and the actual redemption process is relatively similar to that of the Barclaycard Arrival Plus World Elite MasterCard. Once you make a qualifying purchase through the Bank of America Travel Center or with a merchant classified as a travel provider, you can redeem your points for a statement credit to cover that expense.
However, this card has some notable benefits over the Arrival Plus:
- Redemptions start at 2,500 points — last month, Barclaycard confirmed changes on the Arrival Plus, announcing that the minimum travel redemption will increase to 5,000 miles in November.
- You have a longer redemption window — Arrival Plus gives you a 120-day window to redeem your points for travel expenses, while the BankAmericard Travel Rewards card offers a full year.
- Tourist attractions are eligible for redemption — last month’s changes to the Arrival Plus also eliminated the tourist attraction category, but those purchases still qualify as travel on this card.
The account fees (or lack thereof) on this card also offer a compelling value proposition. The card has no annual fee and no foreign transaction fees. There are many cards with no foreign transaction fees, but the vast majority of them carry an annual fee. The closest competitor is the Capital One VentureOne Rewards Credit Card, which does offer a similar 20,000-point sign-up bonus, but only earns 1.25 miles per dollar on purchases.
I had long overlooked the BankAmericard Travel Rewards® Credit Card. Bank of America hasn’t typically offered the most rewarding options for points and miles junkies, but this new sign-up bonus has caused me to rethink my quick dismissal of this card, especially in comparison to Barclaycard’s soon-to-be-devalued Arrival Plus.
If you crunch the numbers, you’ll find that you need to spend a lot of money on the Arrival Plus in order to earn a better return (after the first year and ignoring the sign-up bonus). Here are the break-even points for annual spending between the Arrival Plus and the various bonus tiers of the BankAmericard Travel Rewards card:
- Standard card (no bonus) — $14,590
- Card with 10% checking/savings bonus — $19,348
- Card with 25% Preferred Rewards program bonus — $37,872
If you spend more than these amounts, the additional earnings on the Arrival Plus make it a better option. However, for the top two tiers of the Preferred Rewards program, there is no level of annual spending that will put the Arrival Plus ahead. Keep in mind too that these numbers don’t take into account any bonus you’d earn for making travel purchases through the Bank of America Travel Center; the break-even thresholds would be even higher when you factor in those bonuses.
This card has a couple other appealing aspects:
1. It’s issued through Bank of America — Many of the most popular rewards cards out there come from a small number of issuers and carry their own restrictions. American Express, for one, only allows you to earn a sign-up bonus once on a given card, and typically restricts you to no more than four active personal or business credit cards. Note that this limit does not apply to charge cards (like The Platinum Card from American Express) which require you to pay your balance in full (something you should be doing with credit cards as well!). This card comes from Bank of America, which is a significant plus if you’ve come close to exhausting your options with other issuers.
2. It can help increase your average account age — Your credit score is based on a number of factors, but one of those is the average age of your accounts. Credit cards with no annual fee are a great help in this regard. Even if you only use them occasionally, keeping them open long-term will increase your average account age and help your utilization rate, since you’ll have more available credit.
3. It’s a great starter card — Last month I wrote about the best starter cards for those new to the points and miles hobby, and this card came in sixth place (though it was the second best no-annual-fee card, behind the Amex Everyday Credit Card from American Express). However, the simplicity of this card may appeal to someone who’s overwhelmed with transferable points programs and doesn’t want to incur an annual fee. There are plenty of ways to redeem Membership Rewards points for maximum value, but redeeming your points to cover any travel expense with a minimum return of 1.5% (plus no foreign transaction fees and no annual fee) is a solid value proposition to a neophyte. With no annual fee and 1% when you make a purchase plus 1% as you pay off your bill), the Citi Double Cash Card is also a worthy contender, though it does include a 3% foreign transaction fee.
While the BankAmericard Travel Rewards® Credit Card isn’t a strong option for aspirational awards like Singapore Airlines first class or free nights at the Park Hyatt Paris-Vendôme, it’s still a solid everyday earning card with benefits that usually aren’t provided without an annual fee (like waived foreign transaction fees). It’s even more rewarding for current Bank of America customers, and given the negative changes coming to Barclaycard Arrival Plus, this card may soon earn a spot in my wallet.
What do you think of Bank of America’s Travel Rewards program?
BankAmericard Travel Rewards® Credit Card
|Intro APR||Regular APR||Annual Fee||Foreign Transaction Fee||Credit Rating|
|0% Introductory APR for 12 billing cycles||15.24% - 23.24% Variable APR on purchases and balance transfers||$0||0%||Excellent/Good|