The Capital One® Venture® Rewards Credit Card introduced big changes today — and for would-be applicants considering the card for the long haul, it’s mostly bad news.
The popular general travel credit card made two major updates:
- A bigger annual fee: The new fee is $0 for the first year, then $95. Previously, the fee was $59, waived the first year. That’s an increase of more than 60%.
- A larger sign-up bonus: Capital One advertises the new sign-up bonus this way: “Enjoy a one-time bonus of 50,000 miles once you spend $3,000 on purchases within 3 months from account opening, equal to $500 in travel.” Previously, the card’s sign-up bonus was worth $400.
Capital One says these changes will not affect existing cardholders. They will apply only to new accounts.
So, if you’re thinking about getting the Capital One® Venture® Rewards Credit Card, what does this mean for you?
- You’ll get less long-term value. If you’re planning on holding this card long-term, the $100 increase in the sign-up bonus doesn’t help much. Within four years, you’ll have paid over $100 more in annual fees compared with what you’d have paid with the previous annual fee. Even with the card’s robust rewards rate — 2 miles per dollar spent on all purchases — you’ll have to spend $4,750 a year after the first year to break even on the annual fee. Before, you had to spend only $2,950.
- There may be better options available. When the Capital One® Venture® Rewards Credit Card’s annual fee was $59, waived the first year, it compared favorably to other general travel credit cards. Now, from a long-term perspective, it’s no longer king of the hill. If you’re looking for similar benefits for a lower cost, consider the Barclaycard Arrival Plus® World Elite Mastercard®, which has an effective 2.1% rewards rate for an annual fee of $0 for the first year, then $89. Or, check out other 2% cards.
The changes on the Capital One® Venture® Rewards Credit Card are good news for at least one group: Those looking to snag a big sign-up bonus without paying the first-year annual fee. But if you’re looking for a card you can use for several years, you might want to consider some other options.