Is Bank of America Still Worth It for Travelers? New BofA Rewards Rules Explained
Smart Travel: Upgrade Your Getaways
Sally French and Meghan Coyle from NerdWallet's Smart Travel podcast examine Bank of America's revamped BofA Rewards program, analyzing whether it
Key takeaways
- Bank of America's BofA Rewards program has been overhauled with a new tier system that may reduce rewards earnings for some cardholders despite added subscription and lifestyle perks.
- The shift in the rewards structure suggests a move toward lower cash-back multipliers, potentially making the program less attractive for high-spending travelers.
Main topics
- Bank of America BofA Rewards program overhaul
- Changes to rewards multipliers and tier benefits
Notable quotes
"I'm really excited to see what they look like because Southwest brand used to have this very fun, colorful palette."
Conclusion
While Bank of America's BofA Rewards program now offers new perks, its reduced rewards multipliers may not justify
Transcript preview
Speaker 2 (0:00) Megan, Built Rewards is not the only loyalty program that got a major overhaul this year. We have to talk about Bank of America, which overhauled its program formerly known as the Preferred Rewards Program. Now it goes by B of A Rewards because this program is affecting me. Ooh, Sally, I know you love your Bank of America Speaker 1 (0:17) credit card. I Speaker 2 (0:18) did. Are Speaker 1 (0:19) you going to keep it or is it time to part? We're going to talk about that today. We are diving Speaker 2 (0:24) into this new program, which really does have me rethinking whether it is still worth it. Speaker 1 (0:32) Welcome to a special in-studio edition of Smart Travel from NerdWallet, a deep dive into the tips, tools, and tactics to maximize your travel dollars. I'm Megan Coyle. And I'm Sally French. And we're the travel nerds ready to help you plan your next big trip. Coming at you from a real video set today, which you can actually watch on Spotify. I Speaker 2 (0:49) do have to bless our episode, like I always do, with our usual disclaimer. And that is that we will talk about a few credit card companies that are NerdWallet partners in this episode that does not influence how we discuss them. The benefits, terms, and fees mentioned were accurate at the time we filmed this, but of course, as you know, things can and always do change as we're about to talk about. Some offers may have expired by the time you're listening, so for the latest details, follow the links in the episode description. And Speaker 1 (1:14) before we get to today's main topic, which, as you guessed, it's all about Bank of America, let's jump back to our home studios real quick so we can record the news. Speaker 1 (1:26) Southwest Airlines is building airport lounges, something that had been rumored and definitely sort of an open secret based on some permits we've seen floating around, but it is now official as of the past week. Yes, so construction has already begun on the Speaker 2 (1:39) first four of these lounges, which are expected to open sometime in late 2027. Speaker 1 (1:45) The four locations are Austin, Baltimore, Honolulu, and Nashville. So those are the first four airports that are going to get one of these new Southwest Airlines lounges. Speaker 2 (1:54) Yeah, and I would consider these four airports to be sort of Southwest strongholds where the airline is one of, if not the dominant carrier. It also is a type of airport where there are few to no other competing lounges already in that terminal. Speaker 1 (2:08) Southwest Airlines has already said that there are even more in the works. There are at least seven planned to open over the next several years. Okay, can't wait to see where those ones are. Now, this Speaker 2 (2:17) is the interesting point, is that Southwest says it is partnering with Chase to bring together what it calls Southwest's signature hospitality and the success of the Chase Sapphire Reserve Lounge Network, which I find so funny because I think a lot of people think of... Southwest as being sort of this budget airline. And these chase lounges are very over the top. We've talked about them on the show, but they're like totally elegant in the design and have really, really nice features like facials. Speaker 1 (2:45) It is a little bit of an odd pairing, but they are. the credit card issuer and the airline that do work together. So it does make sense on that front. I'm really excited to see what they look like because Southwest brand used to have this very fun, colorful palette. And it used to be like about love LUV. And I feel like customers haven't been feeling the love in the past year or so, but I'm excited to see how they try to bring that back in their lounge design. I am certainly curious. We Speaker 2 (3:12) wrote about this on the website over at nerdwallet.com and there were all sorts of comments, people being like, Oh, what is, it going to be? A tiny paper cup of soda and pretzels. So I'm curious, is Speaker 1 (3:22) the lounge going to be bougier than that? I guess time will tell. So how are people going to get into these lounges? That's the most important question on people's minds. And Southwest says they are going to have a new premium Southwest Rapid Rewards credit card. It's going to be issued by Chase and it'll launch in 2027. That's the card you'll need to get into these lounges. We have no other details besides Speaker 2 (3:42) that, but I can assure you we will be watching. We only know it'll launch in 2027. I will say it's safe to assume that this card will have the annual fee in the many hundreds of dollars range. Speaker 1 (3:53) Right, because if you look at other premium airline credit cards with airport lounge access, I mean, it is like... Speaker 1 (4:01) $650, $700, that kind of range. I'm not sure what the Southwest premium card annual fee actually will be, but I think you can expect it to go several hundred dollars. Speaker 2 (4:12) Yeah, I guess I'm just not surprised that Southwest is moving in the direction of these other big airlines. You think about Delta has premium cards and lounges. United has premium cards and lounges. Southwest has made so many changes recently to be like those other airlines. I'm talking ending that two free checks bags Speaker 1 (4:28) policy. I am not surprised that Southwest is now just trying to be like the others and add its own lounges. You know what I would like to see is Southwest kind of go the way of Alaska Airlines or even JetBlue, where their premium card is expensive, but does give people access. sometimes in more limited ways, but in ways that still please these customers. So for example, on the Alaska Summit card, which is the premium airline card for Alaska and Hawaiian airlines, you get two lounge passes per quarter. And so it's not like unlimited lounge access. So I'm very curious, like if this new Southwest premium card will put limits on the number of visits or some maybe like limited number of guests, but it'll be a lower annual fee. That's what I would hope to see. We see a lot of airlines that actually do that. Speaker 2 (5:15) United as an example, their $695 annual fee United Club Infinite card does give unlimited lounge access to the more than 45 United Club locations. But then there's certain cards that just give you two lounge passes a year. So I think you are probably right. We will see something like that. The bottom line, though, is something we're seeing across all cards. is that airlines seem to believe the path to revenue is through these premium products, more and more upcharges. Air travel is at all-time highs. I don't think airlines are necessarily trying to get more customers. I think they're looking for ways to get the existing mega pool of customers to pay even more. And I do think lounges and, by default, credit cards are their next path to revenue. And Speaker 1 (5:57) premium products in general, right? It's not just the lounges. It's also premium economy seating and first-class seating. which is actually our next news item. So JetBlue has finally released the details of its new Blue First domestic first class, which is a new type of cabin they haven't had before. They used to have JetBlue Mint, and that was this like... amazing live flat seat. You could fly it like domestically or also on some of their international flights. Now they're adding this blue first type of seating, which is just a recliner to more airplanes. So that way when you're flying domestic first class, you might not be flying in mint. You'll be flying in blue first. We Speaker 2 (6:36) see this with a Speaker 1 (6:36) lot of Speaker 2 (6:37) airlines that wouldn't necessarily have that live flat seat, but there's still that bigger first class seat. So with Jet Blue's Blue First. It's a two by two configuration, which is better than what they currently offer in that they have this thing called the Even More Seats. Those ones are a little bit bigger, but they still have you sitting three across. So I like the no middle Speaker 1 (6:57) seat. Speaker 2 (6:57) Those are more Speaker 1 (6:57) like extra legroom seats, like even more Speaker 2 (6:59) seats. Yeah, so this is cushier and no one has to get the middle seat. In fact, these ones have five inches of recline, which is up to seven more inches of legroom than your standard main seat. These also have 13.3 inch screens with a Bluetooth, so that way you can pair your own headphones with it. Speaker 1 (7:15) And the detail that I can't stop thinking about is their new Mixologist mode on their seat back screens. So apparently you can use the screen to make your own cocktail. Like you get to pick your spirit and your mixer and then the crew will like bring you all the things you need to make that cocktail. That sounds super fun. Speaker 2 (7:33) Yeah, definitely. I think something that we see trending in the whole travel space is everyone wants customization of whatever sort it is. So I like that you can just do a custom drink. All Speaker 1 (7:41) right, Sally, now tell us. all about the new water park you went to with Norwegian Cruise Line. Speaker 2 (7:47) Yes, thank you so much to Tess who covered me on the news last week because I was floating down a lazy river. I was at Great Stirrup Key, which is NCL's private island in the Bahamas. They've been going through this phased renovation process and last Friday they opened a new water park. This water park is so much fun and has a lot of features that I've never experienced before in a water park. So the number one thing that I thought was fascinating is they have cliff diving. So they have a 10 and a 15 foot cliff and then you could jump off. I always want to do this out in the wild, but I do consider myself pretty responsible and I don't want to just jump into any random pool of water because you don't know how deep it is or how many rocks are down below. So this was a really fun way to experience this. And then the other thing that was an absolute hoot, they have this thing that's kind of... of like a lazy river but they call it a wandering river where it moves much faster so it kind of feels like a little bit of a Disney ride and then in fact there's this point where you go through a tunnel and it's designed to be a bioluminescent tunnel it's dark and they have screens of creatures swimming past you which I thought was unbelievably fun Speaker 1 (8:54) Oh, that's so fun. I've been in some caves with like bioluminescent like worms and stuff like that. Real ones. Yeah, it was amazing. So I like that they took some inspiration from nature for this particular water park. So as I mentioned, this Speaker 2 (9:09) is just a piece of their private island, which has a ton of features like a pool, a splash zone. I will note that this water park is an additional fee and the fee varies based on the sailing and I think just the demand. They're saying roughly $99 per person. So if you do want to go to this water park and you are sailing with NCL, just make sure that you budget that on top of your cruise fare. Oh, Speaker 1 (9:31) wow. Okay. That is a pretty decent upcharge. There's a lot of free stuff to do on private islands as well, which... is usually just going to the beach or exploring the island. But yeah, there are a lot of upcharges that can get you when you are hanging out on this private island. It feels like you're on the ship, but you actually might be paying more for whatever you're doing. And Speaker 2 (9:49) you know what, Megan? I actually just took a walk around the rest of the island. The beach was totally empty. White, sandy beach. Nobody there because everyone was at the water park. I would say if you're sailing with NCL, don't feel like you need to pay for the upcharge because there is so much good free stuff to do on the private island. But if you are looking for something a little bit more, I did have a great time. If Speaker 1 (10:08) you want to see photos or videos from NCL's new water park or just the private island in general, check out Sally's Instagram and TikTok. She is SavedWithSally on both of those platforms. Thank you Speaker 2 (10:19) so Speaker 1 (10:19) much for Speaker 2 (10:19) the shout out. I'll give you one is make sure you follow Miles with... Megan Coe that is CEO because Megan is Eddie and everywhere at all times so see what she's up to there too. Now final news item we have to talk about some really good transfer bonuses out there lately. The big thing on my mind is that Chase Ultimate Rewards has a transfer bonus of 20 % to Air Canada Aeroplan. This Speaker 1 (10:40) transfer bonus runs through the end of the month it ends on September 30th. The month of September, we also have a 30 % transfer bonus from Capital One to Japan Airlines. We've mentioned this a couple of times on the show before, but Japan Airlines is one to look at if you are looking to go to Japan or anywhere in Asia. And they have