I might be what you call “cheap.” When I first started using credit cards, I never signed up for ones with annual fees.
After all, why pay a bank to use their credit card? But over time, my approach changed once I realized how many perks cards with fees have to offer.
Case in point: The Capital One Venture X Rewards Credit Card comes with a $395 annual fee. That might seem steep on the surface, but I’ve found it pays itself back. Here’s how you can use the card’s travel perks to offset its annual fee.
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1. Take advantage of the intro bonus
Many credit cards come with intro bonuses, where if you spend a certain amount, you receive a bonus. The bonuses can be in the form of cash back, points or miles. This is a great way to use the card on everyday purchases and be rewarded for expenses you were going to make anyways.
The Capital One Venture X card offers an excellent intro bonus, where if you charge $4,000 within the first three months, you earn 75,000 miles.
This equals $750 in travel credits you can use to book trips through Capital One Travel. And just by meeting this intro bonus, you’ve paid for your annual fee for the first year.
2. Maximizing miles redemption
The intro bonus is nice, but if you’re like me, you might be wondering if you will get enough use out of the card to justify its annual fee after the first year.
This is where elevated travel rewards cards like Capital One Venture X really excel. The card allows you to earn an unlimited 10 miles per dollar for hotel and rental cars booked through Capital One Travel; five miles per dollar on vacation rentals and flights purchased through Capital One Travel and two miles per dollar for all other purchases.
So, what are miles worth? It depends on how you redeem them.
You can redeem miles for travel purchases through the Capital One portal at a rate of one cent per mile. That’s not great on the surface, but if you travel regularly and book most aspects of your travel, especially flights and hotels through Capital One, these rewards can add up fast.
You can also use these miles at the same ratio to pay for previous travel booked the last 90 days through Capital One.
Further, you can transfer your Capital One miles to other participating airline and hotel programs, like Wyndham Rewards or Air Canada Aeroplan®, with most having a 1:1 ratio.
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Here’s an illustration of how transferring works: You earned the Venture X intro bonus of 75,000 miles and transfer them to your Wyndam Rewards account. You’ll have 75,000 points to use, entitling you to two free nights at the Wyndham Alltra Playa del Carmen Adults Only All Inclusive in Mexico.
Wyndam offers free nights on resorts worldwide at 30,000 points per night. This illustration shows you can really elevate your trips the more you use your card.
Other redemption methods include using your miles for Amazon purchases, at a rate of 0.8 cents per mile. The less ideal option is to cash out your miles for a check or statement credit, as the rate of redemption is half a cent per mile.
Overall, the cash-back rewards are going to work best for avid travelers. However, if you only take a few trips per year, there are other ways to offset the annual fee.
3. Anniversary bonuses for the win
Capital One rewards its Venture X cardholders with two anniversary bonuses every year you have an active account.
The first is a $300 annual credit to use through Capital One Travel. The best news is there are no spending hoops to jump through. It’s just a perk for having the card.
The other bonus is every year you have an active Venture X card, Capital One gives you 10,000 miles, starting on the first anniversary of opening the card. That’s akin to $100 in travel credits every year.
Combined, these two anniversary bonuses give you $400 in travel credits, thus easily offsetting the $395 annual fee.
4. Elevated travel perks
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The Capital One Venture X card elevates stays with an abundance of travel perks. And when you book through their Premier Collection, not only will you stay at exceptional hotels, you’ll also earn perks that make the trip more enjoyable.
To demonstrate, say you want a weekend getaway at the Regent Santa Monica Beach. Using the Venture X card, you could book the hotel through Capital One Travel to earn 10 times the miles.
Given the hotel’s average price is around $800 per night, you’ll earn 8,000 points, or $80 in travel credits for every night you stay there. On top of that, you’ll gain the following:
- A $100 experience credit you can use for eligible purchases during your stay
- Free breakfast for two
- Room upgrades when eligible
- Early check in and late check out
- Complimentary Wi-Fi
Is the Capital One Venture X card worth its fee?
The Capital One Venture X card comes with tons of perks to elevate your travel. And therein lies the key: This card works best for avid travelers.
If you travel often, then the perks do offset the annual fee, provided you book your trips through Capital One Travel or transfer the miles to participating airlines or hotels.
Along with the generous miles for hotel and flight purchases, you’ll earn anniversary bonuses that will continually offset your annual fee for as long as you have the card.