A deceptively high rewards rate
At first glance, the Key2More Rewards card seems to offer one of the most generous rewards programs around. Cardholders are awarded five points for every dollar they spend, plus an additional 25 percent points bonus when they spend at least $1,000, and a 50 percent points bonus when they spend more than $2,000. The card also offers an additional, generous-sounding sign-up bonus of 10,000 points after you make five purchases within two months of opening your card. However, if you look more closely at the Key2More Rewards program, you’ll find the card’s rewards program isn’t nearly as valuable as it seems.
Do the math before you apply
When a credit card offers a rewards rate that seems too generous to be true, it’s a good idea to pull out your calculator and check out how much those points are actually worth. In most cases, the rewards points are deliberately valued at just a fraction of the average credit card rewards point, which typically goes for about a penny each.
In the case of Key2More Rewards, we estimate that each point is worth $0.002, which is conveniently equal to one-fifth of a penny. As a result, the card’s effective rewards rate – when compared to other cards – is actually just one point for every dollar you spend, not five points. Meanwhile, the card’s anemic sign-up bonus is worth just $25 – a big disappointment when you compare it to cards that offer $100 or more in bonuses.
Best for heavy spenders
The card’s monthly spending bonuses help make up for the card’s anemic rewards value, but you have to spend a significant amount to earn the maximum amount. For example, if you spend $2,000 a month – the minimum amount you need to spend to earn a 50 percent bonus – you effectively earn 2 cents in rewards for every dollar you spend. That’s pretty generous for a travel card, particularly since KeyBank doesn’t limit how much you can earn.
For example, if you spend just $2,000 a month, you can end the year with rewards worth up to $480 or more. If you spend $4,000 a month, you can earn a whopping $960. If you’re not such a heavy spender, though, you’re going to have a tough time earnings enough points for big rewards.
Pricey redemption
The KeyBank Key2More Rewards card also loses points as a travel rewards card because it reserves the right to charge cardholders “fulfillment fees” when they redeem points for airfare, travel vouchers or other rewards purchases. Like most rewards credit cards, KeyBank also makes you go through the bank’s website to book travel purchases and it doesn’t let you transfer points to other loyalty programs. Unlike many travel cards, though, it doesn’t impose any travel blackout dates, so you can travel whenever you please.
Reasons to get it:
- You plan to spend more than $2,000 a month and so can earn the 50 percent spending bonus.
- You want more flexibility with rewards-funded travel and want to be able to choose when you fly or stay in a hotel.
- You’re already a customer of KeyBank and want a card with the same bank.
How to use it:
- To get the most value out of this card, use it for all or most regular monthly purchases so you have a better chance of earning the 25 to 50 percent spending bonus.
- If you can, try to pay off purchases in full. The card’s 13.24 percent to 22.24 percent APR is relatively high.
- Shop around before redeeming points for travel. You may get more value from your spending if you redeem points for cash and use the money to pay for travel you bought elsewhere.
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