Despite its name, the new Bank of America® Premium Rewards credit card isn’t exactly on the level of premium cards such as The Platinum Card® from American Express or the Chase Sapphire Reserve℠, which come laden with extra perks but also carry annual fees in the hundreds of dollars. Its closest competitors are on the next tier down. And the best-known of those competitors is the venerable Chase Sapphire Preferred® Card.
Deciding between two rewards credit cards often is just a matter of comparing the rewards you’ll earn on each. But the Bank of America® Premium Rewards credit card and the Chase Sapphire Preferred® Card are similar enough that perks and features beyond rewards rates could tip the scales. Want points you can transfer? Want your checked-bag fees covered? Your answers to such questions will guide your decision.
That said, if you have significant balances in checking, saving or investment accounts at Bank of America® and Merrill Lynch®, your choice gets a whole lot easier, since the Bank of America® card offers generous bonuses.
If rewards are your north star, jump ahead to our calculator to see which card would give you the most in rewards based on your spending. Otherwise, we’ll start with these cards’ basic features, and then compare them point by point.
|Bank of America® Premium Rewards credit card||Chase Sapphire Preferred® Card|
|Full details and application link|
|Annual fee||$95||$0 for the first year, then $95|
|Point transfer partners||None||11 airlines and hotel chains|
|Rewards accelerators||Members of the Bank of America® Preferred Rewards program can earn points bonuses of 25% to 75%||Points are worth 25% more when redeemed for travel booked through Chase|
|Sign-up bonus||Receive 50,000 bonus points – a $500 value – after you make at least $3,000 in purchases in the first 90 days of account opening.||Earn 50,000 bonus points after you spend $4,000 on purchases in the first 3 months from account opening. That's $625 toward travel when you redeem through Chase Ultimate Rewards®|
|Airline fees credit||$100 per year||None|
After the first year, it costs the same to carry either of these cards. The Chase Sapphire Preferred® Card’s waived first-year fee does give it an initial leg up. However, the Bank of America® Premium Rewards credit card gives you travel credit that, if you use it, more than makes up for the fee every year.
If you spent the same amount on each card, the Bank of America® Premium Rewards credit card would give you a higher number of points because you get an extra half-point for every dollar spent on something besides travel and dining. However, points on the Chase Sapphire Preferred® Card are worth 1.25 cents apiece when you redeem them for travel booked through Chase, while points on the Bank of America® card are worth 1 cent apiece regardless of how you redeem. Assuming you redeem at 1.25 cents a point, the effective rewards rates for the Chase card are 2.5% on travel and dining and 1.25% on everything else.
If you’re a member of Bank of America® Preferred Rewards, however, everything changes. More on that in a bit.
Chase allows you to transfer your points on a 1:1 basis to seven airline loyalty programs (Air France/KLM, British Airways, Korean Air, Singapore Airlines, Southwest, United and Virgin Atlantic) and four hotel programs (Hyatt, IHG, Marriott and Ritz-Carlton).
The Bank of America® Premium Rewards® credit card offers no such transfers.
In point terms, the bonuses on both cards are comparable, but you can get more value from the bonus on the Chase Sapphire Preferred® Card, depending on how you redeem it.
The Bank of America® Premium Rewards credit card gives you up to $100 in statement credit for incidental airline fees such as checked bags, seat upgrades, in-flight food and beverages, and lounge passes. Earn the full credit — which you could do on a single round trip with two people each checking a bag each way — and the card effectively pays you $5 a year after the annual fee. The Bank of America® Premium Rewards credit card also reimburses you up to $100 every four years for the application fee for TSA PreCheck or Global Entry program.
The Chase Sapphire Preferred® Card does not offer these benefits.
Preferred Rewards program makes big difference
The secret weapon of any Bank of America® credit card is the bank’s Preferred Rewards program. If you are a Bank of America® customer with at least $20,000 in combined balances in checking, savings or investment accounts with Bank of America®, Merrill Lynch® or Merrill Edge® accounts, you earn bonus rewards:
|Required balance||$20,000-$49,999||$50,000-$99,999||More than $100,000|
If you’re not a Preferred Rewards member, your effective rewards rates on the Bank of America® Premium Rewards credit card are the standard 2% for travel/dining and 1.5% for everything else. At Preferred Rewards’ Gold level, those rates rise to 2.5% and 1.875%, respectively. At Platinum, they’re 3% and 2.25%. At Platinum Honors, they’re 3.5% and 2.625%.
Calculate the rewards and decide for yourself
With the features, bonuses, credits and rewards accelerators on these cards, your head might be swimming. So we’ve created a calculator to do the rewards math for you:
This calculator does not take into account the sign-up bonuses on the cards or the value of the Global Entry/TSA PreCheck benefit on the Bank of America® Premium Rewards credit card. These are rewards in a more or less “regular” year.
Making the choice
These are two excellent cards, so there’s no “bad” choice. Cardholders who travel regularly should get plenty of value with either one. If you’re a Bank of America® Preferred Rewards customer, you can’t beat the rewards you’ll earn with this card — at least, not for an annual fee of $95. For everyone else, it boils down to the rewards math and which features matter most. Our calculator can take care of the math; the rest is up to you.
Published Oct. 10, 2017.