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Bank of America and Discover are two of the country’s most popular financial institutions and offers a raft of credit card options. This review and comparison is going to focus on two cards from this offering.
They both have their unique features, as well as some common features. The Bank of America® Travel Rewards and Bank of America® Cash Rewards are highly popular and you can learn a bit more about if one of these cards is going to be suitable for you.
General Comparison
Compare Rewards: Which Card Gives More?
While we’ve looked at various card features, in order to understand the real world benefits of the cards, a direct scenario comparison can be very helpful.
Since both cards are designed for everyday spending, we will take a typical monthly spending list to see what rewards you could earn if you have a similar spending pattern.
As you can see, the rewards for these cards are identical. Both cards have the same reward rate and the same redemption rates of 1 cent per mile or point. So, there is very little to separate the cards in this regard.
However, during the first year, Discover will match your rewards at the end of the first year. This means that with this spending pattern, you’ll get a bonus of $370.80, which is almost double the introductory bonus offered by Bank of America.
|
| |
|---|---|---|
Spend Per Category | Discover it® Miles | Bank of America® Travel Rewards |
$15,000 – U.S Supermarkets | 22,500 miles | 22,500 points |
$3,000 – Restaurants
| 4,500 miles | 4,500 points |
$1,500 – Airline | 2,250 miles | 2,250 points |
$1,500 – Hotels | 2,250 miles | 2,250 points |
$4,000 – Gas | 6,000 miles | 6,000 points |
Annual Points | 37,500 miles | 37,500 points |
Estimated Points Redemption Value | 1 mile ~ 1 cent | 1 point ~ 0.6 – 1 cent |
Estimated Annual Value | $375 | $225 – $375 |
Welcome Bonus
This first comparison highlights the difference between the two cards. While both cards offer a sign up bonus, it is completely different with each card.
While Bank of America has the standard spend requirement within the first 90 days to earn bonus points, Discover will add up all the miles you’ve earned during your first year and match them at the end of the year. This means that if you earn 25,000 miles throughout the first year, at the end of the year, you’ll receive an additional 25,000.
This is a great incentive for those who are planning on regularly using their card and want to save up their miles to make a significant travel purchase at the end of the first year. While you won’t receive this introductory bonus quickly, as you would with the Travel Rewards card, it could add up to a massive bonus, as there is no cap or restriction.
Overall, there are other travel cards with more attractive sign up bonus.
Fees
In this comparison, the differences between the two cards are far more subtle. At first glance, the Discover It Miles card appears very similar to the Bank of America Travel Rewards. Both cards have no annual fee and no foreign transaction fees. The balance transfer fee is also the same, but Discover has limited this rate until March 2022 and after this point, it is more expensive compared to Bank of America’s.
The main difference is in the rates. Discover generally has a lower APR. However, while both cards offer a 0% APR introductory rate, it is slightly shorter, as Bank of America offers an extra month. This means that if you’re looking to make balance transfers, Bank of America is a slightly better choice.
Although your rate may be a little higher, you don’t need to rush into organizing your balance transfers and you’ll have an extra month to pay it down at 0%.
Compare Perks
This is another area where the cards are quite similar, as neither one offers significant extra benefits. Both cards have the usual access to apps, online account management etc, but there are no outstanding benefits with either card that you may find with other cards.
The only real stand out feature is with the Bank of America card, where you can earn up to 75% more points on your purchases if you enroll in the Preferred Rewards program, but this does have qualification requirements.
Overall, the perks are limited but it make sense since there is no annual fee. Most travel cards require an annual fee. For example, the Chase Sapphire Preferred annual cost is $95 .
Unique Perks
Discover it® Miles
- Sign Up Bonus: Discover Matches Miles
If you spend $10,000 over your first 12 months, for example, you’ll accrue 15,000 miles on your card and Discover will match that giving you a total of 30,000 miles earned in your first year.
This is a great benefit because it gives you time to spend money on your card throughout the year. You don’t have to rush to make lots of purchases the first 3 months like most credit cards limit you to for sign up bonuses.
- No Minimum Redemption Requirements
Some credit cards require you to have a minimum $20 balance before you can access redemptions, but with the Discover It Miles card, there are no minimum requirements.
This gives you the flexibility to accrue a large balance or redeem a small balance such as one mile.
Bank of America® Travel Rewards
- 0% APR Introductory Rate on Purchases
If you are looking to save money on interest, the Bank of America Travel Rewards Credit Card offers a 0% introductory rate for 15 billing cycles for purchases (then 18.24% – 28.24% Variable APR will apply. A 3% fee (min $0) applies to all balance transfers).
This is great if you have a big purchase in mind and want to pay over time. Note that there are other cards that offer longer 0% introductory rates.
- Visa Card Benefits & Other Perks
Lastly, Bank of America Travel Rewards Credit Card has car rental insurance in excess of the company’s insurance policy. You can also add a PIN to your card for international travel to protect your card in case of theft.
Compare The Drawbacks
Before you make a financial decision, it is crucial that you are aware of both the positives and possible drawbacks, so you can have a clear picture of if it is the right choice for you.
So, here we’ll examine potential negatives of each card.
Discover it® Miles
- No Immediate Sign Up Bonus
As we touched on earlier, while Discover will match your miles for the first year which can summarize in hundreds of dollars, you won’t receive this until the beginning of year two.
So, if you’re looking for an immediate bonus, this is not the card for you
- Balance Transfer Fee
The balance transfer fee is 5% – one of the highest in the market.
Bank of America® Travel Rewards
- Best Rewards Reserved for Preferred Rewards Members
While you can obtain an equivalent number of rewards from the Bank of America Travel Rewards as you would with Discover It Miles, if you want to access the best rewards, you’ll need to enroll in the Preferred Rewards program.
For this, you’ll need to have an eligible, active Bank of America checking account and have an average combined balance of $20,000.
Compare Redemption Options
As we mentioned in the intro, both these cards are designed to help you pay for travel purchases, but there are multiple redemption options.
Discover allows you to:
- Get a statement credit to pay for your travel purchases
- Use your miles to shop with PayPal and Amazon.com
- Fund your travel plans: There are no blackout dates and eligible purchases include hotels, restaurants, and airfare.
Bank of America offers you to use your rewards to:
- Book your trip without any blackout dates, restrictions or specific websites.
- Redeem as a statement credit to pay for your travel or dining purchases. This includes restaurants including takeout, baggage fees, vacation rentals, hotels and flights.
How to Maximize Cards Benefits?
If you want to make the best use of your Discover it® Miles Card, there are some tips to help you:
Make all your significant purchases in the first year. If you’re planning on making a large purchase, you can not only take advantage of the 0% APR intro, but Discover will match your miles, so you’ll get a double reward.
- Use With Other Cards: you only get 1.5x miles flat rate with this card. Therefore, you can use it in conjunction with cards that are better for certain categories.
If you want to make the best use of your Travel Rewards Card, there are some tips to help you:
Sign up for Preferred Rewards: If you can meet the membership criteria, joining Preferred Rewards will enhance your rewards. As a Gold Preferred Rewards member, you’d earn an extra 25%. In the above scenario, this would take your monthly rewards from $30.90 to $38.62, which is an extra $92 per year.
Link your Bank of America checking account for overdraft protection. If you want to avoid the embarrassment of declined purchases, you can link your checking account to your credit card, which will trigger an automatic transfer if you are close to your card limit.
Customer Reviews: Which Card Wins?
Satisfied cardholders report that this card is simple to use for your everyday spending. You don’t need to worry about spending categories or caps. Additionally, the miles match bonus for the first year is also praised as a nice incentive.
Negative comments are centered around the limited time window for balance transfers. You’ll need to be quick to arrange any balance transfers before the fee increases. This is certainly an area where Bank of America comes out ahead as its fee remains at 3%.
Satisfied borrowers report this card is a great fit if you already have Bank of America products or are considering opening a Bank of America checking account, as you can link your card and earn extra rewards if you join Preferred Rewards.
The negative reviews tend to relate to poor customer service. Some newer customers have reported card freezing issues and charges even when the balance has been cleared in full.
Bottom Line
While these cards appear very similar, there are some important differences. If you’re looking for a card offering rewards to fund your travel plans, either card could work for you.
However, there are scenarios when one card may be a better choice compared to the other.
When You Might Want the Discover it® Miles?
The Discover it® Miles Card is a good choice if you:
You are prepared to wait to receive your introductory bonus, as you’ll get your miles matched at the end of the first year.
- You're a frequent traveler that can take advantage of the miles you accumulate.
When You Might Want the Cash Travel Card?
The Bank of America Travel Rewards Card is a good choice if you:
You are looking for a quick cash introductory bonus
You are already a Bank of America customer and can link your checking account
You qualify for the Preferred Rewards membership program, as you’ll get extra rewards.
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