Is the new Capital One Savor card worth it?
Savor's upgraded version comes with high bonuses, a generous sign-up bonus ? and an annual fee. Should you apply?
Tony Mecia is a business journalist who writes for a number of trade and general-interest publications. Every week, he answers readers’ questions about credit card rewards programs in his “Cashing In” column.
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Should I sign up for the new Capital One Savor credit card?
The upgraded version of Capital One Savor's cash back card comes with big bonuses on dining and entertainment, plus a generous sign-up bonus, aimed to woo on-the-go millennials. On the flip side, the card comes with an annual fee.
If you're somebody who cooks in and doesn't venture out much to concerts or sporting events or the bowling alley, then you'll probably want to consider other cash back options, including Capital One's no-annual-fee SavorOne card.
Dear Cashing In,
I just saw that Capital One has a new card that gives some pretty good bonuses in a couple categories, but that it has an annual fee. Should I get it? Is it worth it? – Jonathan
In August 2018, Capital One made a number of changes to its Savor cash back card. It is not a new card. But the dramatic changes Capital One is making to the card make it worth considering.
Previously, the product was not as compelling. Let’s look a little closer at the changes. Then you can decide if the card makes sense for you.
In 2017, Capital One unveiled its Savor card, a no-annual-fee cash-back card that offered 3 percent back on dining out, 2 percent back on groceries and a $150 sign-up bonus. That’s not awful, but it didn’t really stand out from several other cards on the market.
Now, however, Capital One has made a number of significant changes.
- It raised the sign-up bonus to $500.
- It upped the restaurant bonus to 4 percent.
- It added another 4 percent category of “entertainment.”
- It tacked on a $95 annual fee (waived for the first year).
At the same time, Capital One also unveiled a no-fee version with lower rewards and a more meager sign-up bonus, called Capital One SavorOne.
Comparing Capital One Savor versus Capital One SavorOne
As it stands now, here are the two cards:
- Annual fee: $95, waived first year.
- Sign-up bonus: $500 after spending $3,000 in first three months.
- Earning rewards: Unlimited 4 percent back on dining and entertainment (including movie theaters, tourist attractions, sporting events, concerts, amusement parks); 2 percent at grocery stores; 1 percent on all else.
- Using rewards: Cash back in the form of a statement credit or check.
- Annual fee: None.
- Sign-up bonus: $150 after spending $500 in first three months.
- Earning rewards: Unlimited 3 percent back on dining and entertainment; 2 percent at grocery stores; 1 percent on all else.
- Using rewards: Cash back in the form of a statement credit or check.
Capital One goes after cash back lovers
In developing these cards, Capital One is tapping into a few trends in the marketplace.
First is a preference for cash back. Surveys consistently show that consumers prefer cash as a reward over all other perks, including travel.
Second, these cards fit into Capital One’s brand of offering cards with rewards that are easy to use.
Like the Capital One Venture cards – travel cards that allow you to book seats on any airline flight – these new Savor cards have flexibility in rewards, since nothing is more flexible than cash.
Capital One’s other cash back card, the Quicksilver Card, offers a flat 1.5 percent back – not bad, but there are competing cards with higher flat cash-back rates, such as Citi Double Cash Card, which offers 2 percent cash back on all purchases (1 percent when you buy plus 1 percent when you pay off the purchases).
Capital One Savor's noteworthy perks
Yet the revamped Savor card has some features that are genuinely noteworthy. For instance, the sign-up bonus of $500 is high for a cash back card. The annual fee of $95 is also high for a cash back card.
But the card might be worth it for you if you can take advantage of the almost unrivaled 4 percent back on dining and the 4 percent back on entertainment – a category that rarely receives bonuses at all.
The fine print of the card offer says that “entertainment” includes “movie theaters, record stores, video rentals [excluding digital streaming and subscription services], tourist attractions, amusement parks, aquariums, zoos, dance halls, billiard and pool establishments, bowling alleys and ticketed events” such as “live theater, bands, orchestras and commercial sports operations.”
Tip: The credit cards with the most rewards tend to be high-end, expensive cards that charge an annual fee. However, if you like the simplicity of cash back or you already have a premium card but want to have a back up card, then a no-annual-fee card may be worth it.
Choosing between both Savor cards
If you’re trying to choose between the two, the regular Savor card might be superior to the SavorOne because of the higher sign-up bonus and 4 percent category bonuses instead of 3 percent.
Another way of looking at it is that the $500 sign-up bonus covers the cost of the annual fee for the first six years of card ownership, and in exchange you get a higher earning rate on dining and entertainment.
Like Barclaycard’s Uber Visa card introduced last year, Capital One’s Savor cards appear designed to appeal to younger, on-the-go millennials.
They’re really worth it only if you can take advantage of the big bonuses at restaurants and on entertainment.
If you’re somebody who cooks in and doesn’t venture out much to concerts or sporting events or the bowling alley – nothing wrong with that – then you’ll probably want to look elsewhere for a card that aligns better with your spending habits.
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