Bank of America Premium Rewards Credit Card Review

Full Review of Bank of America Premium Rewards Credit Card

Pros Explained

Rewards Rates: Between Solid and Standout

Cardholders can earn base rewards rates of 2 points per dollar on travel and dining and 1.5 points per dollar on everything else; there's no limit on what you can earn. While there are cards that offer slightly bigger rewards, those are above-average rates.

Also, what qualifies for the travel and dining category is liberal and includes such potential everyday purchases as bus and taxi fare and tolls, along with such entertainment expenses as admission to zoos, circuses, and amusement parks. Points can be redeemed for a healthy 1 cent per point to book travel, deposit as cash back to a Bank of America or Merrill account, or buy gift cards. The card's points rates are supercharged if you have at least $20,000 in a Bank of America bank account or Merrill investment account.

Under the bank's Preferred Rewards program, a three-month average balance of $20,000 will earn you a 25% point bonus. The bonus rises to 50% if you maintain a $50,000 balance and to 75% if you have $100,000-plus in an account. B of A customers with substantial holdings will be hard-pressed to earn better points rewards with any other card. 

Generous Travel-Fee Credits

You'll get up to $100 each year in credits for incidental airline fees. The credit can be applied to the cost of seat upgrades and ticket change and cancellation fees, which the airline-fee credits with some other cards do not allow. Also eligible are charges for checked baggage, in-flight entertainment, in-flight food and drink, and entrance fees for airline-owned airport lounges. In addition to the airline fee, you'll also get an application fee credit for TSA PreCheck or Global Entry membership, a value of $85 or $100, respectively. The membership for both programs lasts for five years, and you’re eligible to receive the credit every four.

This benefit isn't unique; at least 20 cards offer it, but many of those competitors charge higher annual fees than the Bank of America Premium Rewards. Both programs allow you to get through airport security faster at U.S. airports, but Global Entry also gives you the option to bypass U.S. Customs and Border Protection screening lines when re-entering the U.S. and instead use an automated kiosk. And the program includes TSA PreCheck, so if you're trying to choose between the two options, go for the one that gives you the benefits of both.

Another travel plus: The Bank of America Premium Rewards lacks a foreign transaction fee. Many other cards levy this surcharge, typically at between 2.7% and 3% of the transaction's value.

Large One-Time Offer

You'll earn 50,000 bonus points after you spend $3,000 in the first 90 days of account opening. That's among the more generous bonuses for a new card these days, and it is worth $500 whether you use your rewards to book travel, get cash back, or buy gift cards.

Cons Explained

No Points-Transfer Partners

The Bank of America Premium Rewards offers fewer options to redeem your points for travel or travel credits than do some other cards. For example, many travel credit cards allow you to transfer your points rewards to partner airline or hotel programs. There's no such option with the Bank of America Premium Rewards card.

Such transfer arrangements allow you more flexibility in redeeming points and can open up opportunities to squeeze more value out of your points than you get by redeeming them with the card's own program.

No Choice in Travel Vendors

The vendors you can redeem your points for travel are limited to only one. Trips and other travel must be booked through the Bank of America Travel Center. Some other travel cards, including the credit card, give you the choice of booking your travel through third-party merchants and then get a statement credit against the purchase.

That option allows you to grab a cheap flight, say, when you see it pop up on a site, and later get reimbursed on the purchase from your rewards balance. That said, Bank of America Travel Rewards does allow you to redeem your points for cash back as a direct deposit to a Bank of America checking or savings account, a credit to an eligible Merrill Lynch or Merrill Edge account, a general credit to your statement, or a gift card—all at a rate of 1 cent per point. This means that you can technically still use points to get statement credits against travel purchases—or any other purchase for that matter—the program doesn't list specific travel transactions for which you can get a credit.

The Bank of America Premium Rewards credit card is most rewarding to those who have a sizable balance in a Bank of America or Merrill account and frequently spend on travel or dining out, its most rewarding categories. By holding a balance of between $20,000 and $100,000 in such an account, you’ll supercharge your rewards rates by between 25% to 75%, respectively, and earn returns that will be hard to beat with any other card.

The card is a worthy choice, too, for travelers and frequent diners who lack an account with a hefty balance. Its 2 points-per-dollar-spent rewards rate represents a competitive return, as does the 1.5 points rate for other purchases. And you needn’t be a constant traveler to enjoy using the airline-fee credit to upgrade your seat on a flight, check bags, or buy food and drinks on the plane.

Also, the card's security-program credit applies to the cost of a five-year membership in TSA PreCheck or Global Entry that will allow you to move more quickly through airport security. (According to the TSA, 93% of TSA PreCheck members waited less than five minutes to get through airport security in July 2019.)

Finally, as a points card, the Bank of America Premium Rewards best suits those who don’t wish to do a lot of work to figure out the best way to redeem their rewards for maximum value since they are worth one cent per point at redemption. 

Bank of America Premium Rewards Credit Card Bonus

The bonus for this card is among the most generous you can get. Provided you spend $3,000 in your first 90 days with the card, you’ll earn 50,000 bonus points. That’s worth $500 and, like other rewards, can be used to offset charges to the card, book travel, deposit cash back to a Bank of America account, or buy gift cards.

Note, however, that Preferred Rewards members don’t earn the 25% to 75% extra on bonus points that they do on those earned with charges to the card.

Rewards Earning Details

The card's base rewards rates are 2 points per dollar on travel and dining and 1.5 points per dollar on everything else. If you’re a Preferred Rewards member, however, here's how your rewards rates break down:

Remember that the balance requirement is based on a three-month average for your combined balances of qualifying Bank of America banking accounts and Merrill investment accounts. You’ll also need to have a personal checking account with the bank to enroll in the program.

Rewards Redemption Details

Redemption options are simple, largely because they’re more limited than with some other cards. You can use your points to book travel directly through the Bank of America Travel Center, or you can get cash back in the form of direct deposit or a statement credit or purchase gift cards.

Regardless of how you use your rewards, they’re worth 1 cent apiece. With many other travel credit cards, you may have the option to redeem points or miles for cash, but it’s usually at a discounted rate, so having this flexibility may compensate for the inability to transfer points to partner programs.

How to Maximize Your Rewards

Most importantly, use the card for every meal or travel purchase to avoid missing out on the elevated points rewards for those categories. Try to use it everywhere else you buy, too, to earn the decent everyday points rewards. And if you have enough cash and investments with Bank of America and Merrill accounts, be sure to enroll in the Preferred Rewards programs to earn its significant points bonuses.

You might even consider moving your money to those institutions and earn those rewards. If you’re mulling this, however, don't do it only for the rewards. True, Preferred Rewards membership offers other perks, including a discount for using the Merrill® Guided Investing service, no-fee out-of-network ATM transactions, and reduced banking services fees.

But before you jump, compare the fees associated with Merrill Lynch and Merrill Edge investment accounts with what you’re currently paying. And even if they’re a little less than what you might make with Bank of America or Merrill, consider if the extra rewards and perks will really justify the hassle of moving your assets.

When it comes to redeeming your rewards, choose the option that gives you the most flexibility and value. For example, compare the prices you see in the Bank of America Travel Center with prices from third-party merchants. If you can find a cheaper flight or hotel stay somewhere else, cash out your points and book the cheaper option.

Bank of America Premium Rewards Credit Card's Outstanding Benefits

• $100 annual airline incidental credit
• Application fee credit for up to $100 for TSA PreCheck or Global Entry every four years
• Trip cancellation and interruption insurance
• Trip delay coverage
• Baggage delay or lost luggage protection
• Emergency evacuation and transportation insurance
• No foreign transaction fee

Standard Benefits

• Travel and emergency assistance services
• Purchase protection
• Extended warranty protection
• Returns protection
• Secondary rental car insurance coverage
• Roadside dispatch
• Free FICO scores to help you keep track of where your credit stands.

Cardholder Experience

Bank of America ranks third in the J.D. Power 2020 Credit Card Customer Satisfaction study. The company received 812 points out of the 1,000 available, which is above the survey average of 810.

The bank offers 24/7 customer service, which is common among major financial institutions. There's also a live chat option on the website that you can utilize even if you’re not a customer. This feature isn't common, and many card issuers that offer it require you to be logged in as a customer.

Security Features

Bank of America's security features are standard for the credit card industry.

Hidden Fees to Watch out For

Overall, the card's fees and APR are on par with many other travel credit cards in the industry. One important thing to note is that you can pay a low cash advance fee (3% of the advance amount, with a $10 minimum) if you receive the money as a direct deposit or check. The typical higher rate applies to other cash advances.

You can also use the card as your overdraft protection on your checking account with the bank, but there’s a $12 fee for each transaction.

Our Verdict

The Bank of America Premium Rewards credit card offers above-average points rewards on travel and dining out, albeit in exchange for a $95 annual fee. And its points are worth a favorable 1 cent each, regardless of how you choose to redeem them.

The card's a potentially unequaled choice for high-worth individuals who hold significant funds in Bank of America or Merrill accounts and so qualify for their Preferred Rewards program. In addition to other program perks, such people earn rewards rates that can outpace any other travel credit card on the market.

Preferred Rewards aside, much of the card's value lies in its hefty introductory bonus and travel credits. Yet many other cards offer similar credits against travel charges, including for incidental airline expenses such as upgrade and baggage charges and to apply for TSA PreCheck or Global Entry fast-security membership. If those are important to you, you might want to shop among the cards that offer them before settling on the Bank of America Premium Rewards.

Also, since the Bank of America Premium Rewards doesn't allow points transfers to partners, consider cards that do if you’re looking to get more value out of your rewards. These include cards that earn Amex Membership Rewards points, Chase Ultimate Rewards points, Citi ThankYou Rewards, or Capital One Venture miles.