Game Over: Here’s Why the Best Credit Card Rewards May End Soon

Game Over: Here’s Why the Best Credit Card Rewards May End Soon

credit card advice

Marcie Geffner
By: Marcie Geffner
Updated: February 1, 2019
Opinions expressed here are ours alone, and are not provided, endorsed, or approved by any issuer. Our articles follow strict editorial guidelines and are updated regularly.

The lucrative game of maxing out credit card rewards may soon come to an end with some consumers hitting the points-and-miles jackpot and others being left out.

The end appears to be near because card companies have tired of consumers who’ve binged on the best rewards without generating commensurate card company profits. Major retailers also have complaints about how big rewards programs work.

Why Cards Offer Rewards

Big banks originally offered attractive rewards to motivate consumers to apply for new cards, become steady customers, and boost profits.

Instead, many consumers gamed the system, signing up for cards, spending just enough to secure big signup bonuses and then abandoning the cards or paying their balances in full every month to avoid interest charges and late-payment fees. Consumers also learned to cancel premium cards before they had to pay the annual fees that card companies often waived for the first year.

“The gamble that generous rewards would make cardholders spend more profligately didn’t pan out,” says Quartz. “It just made this subset of card users diversify by signing up for a higher quantity of generous cards.”

The Wall Street Journal recently described a couple who flew around the world with free business-class airline tickets, thanks to big signup bonuses from their his-and-hers Chase Sapphire Reserve® cards and points they’d accumulated from other cards. Their trip took them from San Francisco to Taiwan, Japan, Serbia, and Germany, and then home again.

Chase Sapphire Reserve Card

The Chase Sapphire Reserve® card took the market by storm with a 100,000-point signup bonus in 2016.

Introduced in the summer of 2016, the Chase Sapphire Reserve® card initially offered a 100,000-point signup bonus, worth $1,500 in travel, for customers who spent $4,000 in the first 90 days after they obtained the card.

Gaming card reward programs was once a niche pursuit. Over time, however, it has become a mainstream hobby. That has hurt card companies since they have to pay for the rewards their customers redeem.

“After ratcheting up the perks for several years, banks hit peak rewards frenzy about two years ago,” the WSJ reported. “Now banks face increasing costs associated with the cards.”

Card Companies are Cutting Back on Perks

Some card companies have already cut back some of their card perks. Vox reports that Chase no longer offers price protection while Citi has limited this perk, which reimburses consumers when they find a lower price for a previous purchase. Discover and American Express have also limited some of their card benefits, according to the Vox article.

Now banks face increasing costs associated with the cards. — WSJ

Smaller signup bonuses and fewer card perks may cause consternation, concern, and disappointment for savvy consumers who aim to optimize their rewards and live large at the card companies’ expense.

For these card enthusiasts, high-value cards like the Chase Sapphire Reserve®, American Express® Gold, and Marriott Rewards® Premier Credit Card “aren’t just cards that facilitate everyday spending . . . They’re an essential way to score things like free flights and cash back,” according to Vox.

By the way, the 100,000-point signup bonus for the Chase Sapphire Reserve® card was halved in early 2017 to 50,000 points, worth $750 in travel. That’s still more than enough to offset the card’s $450 annual fee.

Chase Screenshot

Chase Sapphire Reserve® cardholders can typically earn a 50,000-point signup bonus so long as they haven’t received a Sapphire line signup bonus within the past 48 months.

Retailers aren’t happy with consumer card habits either. Some are so determined to quash cards that offer especially valuable rewards that they’re arguing their case in court.

Merchants currently aren’t allowed to choose which cards within a brand they want to accept. Instead, if they accept some cards with a brand (e.g., Visa, MasterCard), they must accept all cards within that brand, including the expensive ones.

Amazon, Target, and Home Depot are among the retailers that want to choose which individual cards within a brand they’ll accept, The Wall Street Journal reported. Given that choice, retailers likely would refuse the cards with the biggest rewards since those are the most costly for them. That would be unwelcome news for consumers who use those cards.

The Best Signup Bonuses Still Available

Despite the controversy, card companies aren’t likely to severely curtail or outright end their reward programs anytime soon. Rather, they’ll probably rejigger their cards to offer less attractive signup bonuses and fewer perks. Rewards will be designed to discourage gaming and encourage — or should we say “reward” — more profitable card use.

Happily, some cards still offer great benefits right now. Here are five to consider while you can still apply for them. You’ll need good or excellent credit to be approved.

  • Earn 2 miles per $1 on every purchase, every day
  • Plus, a one-time bonus of 50,000 miles once you spend $4,500 on purchases within 3 months from account opening
  • Miles won't expire for the life of the account, and there are no categories to limit where or what you buy
  • $0 intro annual fee for the first year; $95 after that
  • There's no limit to the amount of miles you can earn
  • Redeem miles for travel, cash back, gift cards and more
Intro (Purchases)
Intro (Transfers)
Regular APR
Annual Fee
Credit Needed
N/A
N/A
19.24% (Variable)
$0 intro for first year; $95 after that
Excellent, Good

Capital One announced the addition of transfer partners to its travel rewards program in late 2018, making the big signup bonus offered by this card even more valuable. Even better, the annual fee is waived for the first year, which means no fees to eat into your bonus.

BEST OVERALL RATING

★★★★★
4.8

OVERALL RATING

4.8/5.0
  • Earn 80,000 bonus points after you spend $5,000 on purchases in the first 3 months from account opening. That's $1,000 toward travel when you redeem through Chase Ultimate Rewards®
  • Earn 3 points per $1 on the first $150,000 spent on travel and select business categories each account anniversary year
  • Earn 1 point per $1 on all other purchases - with no limit to the amount you can earn
  • Points are worth 25% more when you redeem for travel through Chase Ultimate Rewards
  • Redeem points for travel, cash back, gift cards and more - your points don't expire as long as your account is open
  • No foreign transaction fees
Intro (Purchases)
Intro (Transfers)
Regular APR
Annual Fee
Credit Needed
N/A
N/A
18.24% - 23.24% Variable
$95
Good/Excellent

With this card, you’ll receive a large signup bonus when you meet the minimum spend on new purchases in the first 90 days after you open your account. Those points are worth 1.25¢ each when you redeem them for travel through the Chase Ultimate Rewards® portal. Earn three points per $1 for spending up to $150,000 per year for travel and select business categories.

BEST OVERALL RATING

★★★★★
4.9

OVERALL RATING

4.9/5.0
  • 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
  • Earn 2X miles on every purchase, every day. Plus earn 10X miles on thousands of hotels, through January 2020; learn more at hotels.com/venture
  • Named ‘The Best Travel Card' by CNBC, 2018
  • Receive up to $100 application fee credit for Global Entry or TSA Pre✔®
  • Fly any airline, stay at any hotel, anytime; no blackout dates. Plus transfer your miles to over 12 leading travel loyalty programs
  • Miles won't expire for the life of the account and there's no limit to how many you can earn
Intro (Purchases)
Intro (Transfers)
Regular APR
Annual Fee
Credit Needed
N/A
N/A
15.24% - 25.24% (Variable)
$0 intro for first year; $95 after that
Excellent, Good

With the Capital One® Venture® Rewards Credit Card, you can use your miles to fly with any airline or stay at any hotel with no blackout dates, or transfer your miles to more than a dozen travel loyalty programs. There’s no annual fee.

BEST OVERALL RATING

★★★★★
4.8

OVERALL RATING

4.8/5.0
  • Earn 50,000 bonus points after you spend $4,000 on purchases in the first 3 months from account opening. That's $625 toward travel when you redeem through Chase Ultimate Rewards®
  • Chase Sapphire Preferred named "Best Credit Card for Flexible Travel Redemption" - Kiplinger's Personal Finance, June 2018
  • 2X points on travel and dining at restaurants worldwide & 1 point per dollar spent on all other purchases.
  • No foreign transaction fees
  • 1:1 point transfer to leading airline and hotel loyalty programs
  • Get 25% more value when you redeem for airfare, hotels, car rentals and cruises through Chase Ultimate Rewards. For example, 50,000 points are worth $625 toward travel
Intro (Purchases)
Intro (Transfers)
Regular APR
Annual Fee
Credit Needed
N/A
N/A
18.24% - 25.24% Variable
$95
Good/Excellent

Meet the minimum spend on new purchases in the first 90 days after you open your account to earn the Chase Sapphire Preferred® Card‘s signup bonus. For the typical 50,000-point bonus, you can redeem through Chase Ultimate Rewards® for $625 in travel. You can also transfer your points, one-for-one, to select airline and hotel loyalty programs. The annual fee for the Preferred card is much less than the premium Reserve card currently offering a similar signup bonus.

BEST OVERALL RATING

★★★★★
4.8

OVERALL RATING

4.8/5.0
  • Enjoy a one-time bonus of 20,000 miles once you spend $1,000 on purchases within 3 months from account opening, equal to $200 in travel
  • Earn 1.25X miles on every purchase, every day and pay no annual fee. Plus earn 10X miles on thousands of hotels, through January 2020; learn more at hotels.com/venture
  • Transfer your miles to over 12 leading travel loyalty programs
  • Fly any airline, stay at any hotel, anytime
  • Enjoy a low intro APR on purchases for 12 months; 14.24%-24.24% variable APR after that
  • Travel when you want with no blackout dates
Intro (Purchases)
Intro (Transfers)
Regular APR
Annual Fee
Credit Needed
0% for 12 months
N/A
14.24% - 24.24% (Variable)
$0
Excellent, Good

This card offers a no-annual-fee way to earn transferable Venture miles, but the Capital One® VentureOne® Rewards Credit Card bonus isn’t quite as large as that for its more expensive sibling. However, you can earn the same 10X miles per dollar at thousands of hotels, and redeem your miles to fly with any airline or stay at any hotel with no blackout dates.

Get Your Bonuses While You Still Can

While it’s hard to say when these generous signup offers and extensive card perks will start to diminish,  it won’t be overnight, and there are still plenty of cards with from which to choose for the time being. The bottom line? Quartz says it best: “Get your 50,000-point bonuses while you still can.”