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Capital One Venture Rewards Credit Card review: For frequent travelers in search of luxury benefits with a low annual fee

CNBC Select reviews all the benefits of the Capital One Venture Rewards Credit Card, so you can decide if this travel rewards card with luxury perks is right for you.

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Anyone struck by a bad case of wanderlust will benefit from a travel rewards credit cards. And if you find yourself taking trips more frequently, you may want to upgrade to a card that offers some luxurious benefits.

Capital One has two travel-focused consumer credit cards: the Capital One® VentureOne® Rewards Credit Card and the Capital One® Venture® Rewards Credit Card. The cards offer similar rewards programs and nearly identical card benefits, but they differ in the number of miles you earn per dollar spent and the annual fee.

With the Capital One® Venture® Rewards Credit Card, which ranks as one of our top credit cards for travel and rewards, you earn 5X miles on hotel and rental cars booked through Capital One Travel℠ and unlimited 2X miles on every dollar spent, as well as up to a $100 credit for Global Entry or TSA PreCheck application fee every four years.

To help you choose the best travel card for your needs, CNBC Select analyzed 33 popular travel cards using an average American's annual spending budget and digging into each card's perks and drawbacks to find the best of the best based on your consumer habits. (See our methodology for more information on how we choose the best cards.)

Below, we break down Capital One® Venture® Rewards Credit Card's rewards, benefits and fees to help you decide if it's the right card for you.

Capital One Venture Rewards Credit Card review

  • Rewards
  • Additional benefits
  • Fees
  • Bottom line

Capital One® Venture® Rewards Credit Card

  • Rewards

    5X miles on hotel and rental cars booked through Capital One Travel℠, 2X miles per dollar on every other purchase

  • Welcome bonus

    50,000 bonus miles once you spend $3,000 on purchases within the first 3 months from account opening

  • Annual fee

    $0 first year, then $95

  • Intro APR

    N/A for purchases and balance transfers

  • Regular APR

    17.24% to 24.49% variable on purchases and balance transfers

  • Balance transfer fee

    3% for promotional APR offers; none for balances transferred at regular APR

  • Foreign transaction fee

    None

  • Credit needed

    Excellent/Good

  • See our methodology, terms apply.

Pros

  • Annual fee is waived the first year
  • 5X miles on hotel and rental cars booked through Capital One Travel℠
  • Global Entry or TSA PreCheck application fee credit up to $100 every 4 years

Cons

  • No introductory APR
  • There’s a $95 annual fee after the first year
  • Estimated rewards earned after 1 year: $1,061
  • Estimated rewards earned after 5 years: $2,526

Rewards totals incorporate the points earned from the welcome bonus

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Information about the Capital One® Venture® Rewards Credit Card has been collected independently by CNBC and has not been reviewed or provided by the issuer of the card prior to publication.

Capital One Venture Rewards Credit Card rewards

If you're looking for a simple rewards program, the Capital One® Venture® Rewards Credit Card has you covered with 2X miles on all purchases. Plus, you earn 5X miles on hotel and rental cars booked through Capital One Travel℠.

This card also has a strong welcome bonus of 50,000 miles — equal to $500 toward travel — when you spend $3,000 on purchases within the first three months from account opening, which is like earning about 17% back.

CNBC Select calculated how many rewards the average American can earn if they optimize the way they use their Capital One® Venture® Rewards Credit Card. We worked with the location intelligence firm Esri, who provided us with a sample annual spending budget of $22,126.

The budget includes six main categories: groceries ($5,174), gas ($2,218), dining out ($3,675), travel ($2,244), utilities ($4,862) and general purchases ($3,953).

Here's how many miles you can earn with your Capital One® Venture® Rewards Credit Card in each category, annually:

  • Groceries: 10,349
  • Gas: 4,435
  • Dining out: 7,349
  • Travel: 3,247
  • Utilities: 9,724
  • General purchases: 7,906
  • Total: 43,010

Based on the annual spending budget from Esri, the average American can earn an estimated $1,061 in rewards the first year of card membership (including the miles earned from the welcome bonus) and an estimated $2,526 in rewards after five years with the Capital One® Venture® Rewards Credit Card.

This assumes that cardholders are redeeming miles for a typical maximum value of 1 cent per mile. Extreme optimizers might be able to achieve more value, and you may earn a higher or lower return depending on your spending habits. Your rewards don't expire as long as your account remains open.

Cardholders can redeem rewards for travel in two ways: as a statement credit for past travel purchases using the Purchase Eraser® or to book future travel through Capital One Rewards Center. Keep in mind statement credit redemptions must be made within 90 days from the date your travel purchase posts to your account.

You can also choose to transfer points or miles to participating hotel and airline partners, like JetBlue and Qantas, but the redemption ratio differs between partners. For example, with JetBlue, the ratio is 2:1.5 (1,000 Venture miles are worth 750 JetBlue TrueBlue points). With the Capital One® Venture® Rewards Credit Card, 1 mile is worth a penny toward travel redemptions (such as airfare and hotels) booked through the Capital One Travel.

Capital One cardholders can also redeem cash back and miles via Amazon.com. The company joins American Express, Chase, Citi and Discover to provide the convenient Shop with Points redemption option to cardholders. Cardholders will have the flexibility to use as many or as few rewards as they like on purchases at Amazon.com. The redemption rate is 125 miles are worth $1 on Amazon.

Additional benefits

This card offers travel and purchase-related perks. These benefits include 24-hour travel assistance services, trip cancellation/interruption insurance, car rental collision damage insurance, travel accident insurance, roadside assistance, purchase protection, extended warranty protection, up to $100 credit for Global Entry or TSA PreCheck application fee every four years and exclusive access to premier culinary, music and sports events, such as the New York City Wine and Food Festival and the iHeartRadio Music Festival.

Capital One also provides a free credit score and report dashboard, CreditWise. It's free to use and anyone can join — you don't need to have a Capital One account. With CreditWise, users can learn more about the key factors that impact their credit scores, get email alerts whenever their credit report changes and monitor their credit information.

Fees

The Capital One® Venture® Rewards Credit Card has no annual fee for the first year, after that it's $95. While $95 pales in comparison to other travel rewards cards that can have annual fees up to $550, it's still something to consider.

Cardholders need to spend approximately $4,750 a year (after the first year) to earn enough rewards to break even on the $95 annual fee. This should be manageable considering the average American spends approximately $22,126 annually, according to consumer spending data from location intelligence firm Esri. But if you have other credit cards that charge an annual fee, you might not want to add another to your wallet.

That said, the Capital One® Venture® Rewards Credit Card's annual fee is effectively offset once every four years if you take advantage of the $100 credit for a Global Entry application.

There's no introductory 0% APR period, and the regular variable APR is 17.24% to 24.49% on new purchases and balance transfers. Travelers going overseas can take advantage of no foreign transaction fees, which is a huge plus when venturing abroad. A 3% fee is charged for balances transferred at a promotional APR and none for balances at the regular APR.

Bottom line

The Capital One® Venture® Rewards Credit Card is a competitive rewards card that provides premium benefits for cardholders. If you're looking to earn flat-rate rewards on everyday spending or higher rewards in bonus categories, this card can be a great fit. And when you take advantage of the added plus of Global Entry/TSA PreCheck credit, you can help offset its $95 annual fee.

Frequent travelers looking to receive some of the benefits found with luxury travel cards will find more value with this card, versus the Capital One® VentureOne® Rewards Credit Card, which is a better choice for consumers who want to avoid an annual fee while taking advantage of special financing.

For high travel rewards, the Capital One® Venture® Rewards Credit Card is the best option with 5X miles on hotel and rental cars booked through Capital One Travel℠. But if you rather earn more rewards on restaurants and groceries at U.S. supermarkets, the American Express® Gold Card can be a great asset with its 4X Membership Rewards® points at restaurants worldwide and U.S. supermarkets (on up to $25,000 per year in purchases, then 1X).

Our methodology

To determine which cards will put the most money back in your pocket, CNBC Select evaluated 33 popular travel credit cards offered by major banks, financial companies and credit unions that allow anyone to join. We compared each card on a range of features, including travel rewards (points and miles), annual fee, welcome bonus, introductory and standard APR, one-time perks, annual perks, redemption rates, as well as factors such as required credit and customer reviews when available.

CNBC Select teamed up with location intelligence firm Esri. The company's data development team provided the most up-to-date and comprehensive consumer spending data based on the 2019 Consumer Expenditure Surveys from the Bureau of Labor Statistics. You can read more about their methodology here.

Esri's data team created a sample annual budget of approximately $22,126 in retail spending. The budget includes six main categories: groceries ($5,174), gas ($2,218), dining out ($3,675), travel ($2,244), utilities ($4,862) and general purchases ($3,953). General purchases include items such as housekeeping supplies, clothing, personal care products, prescription drugs and vitamins, and other vehicle expenses.

We then estimated how much the average consumer would redeem over the course of a year, two years and five years, assuming they would attempt to maximize their rewards potential by earning all welcome bonuses offered and using the card for all applicable purchases. All rewards total estimations are net the annual fee and assume that you are paying your credit card balance on time and in full each month so as not to incur interest charges.

It's important to note the value of a point or mile varies from card to card and based on how you redeem them. When we calculated the estimated returns, we assumed that cardholders are redeeming points/miles for a typical maximum value of 1 cent per point or mile. (Extreme optimizers might be able to achieve more value.)

Our final picks are weighted heavily toward the highest five-year returns, since it's generally wise to hold onto a credit card for years. This method also avoids giving an unfair advantage to cards with large welcome bonuses.

While the five-year estimates we've included are derived from a budget similar to the average American's spending, you may earn a higher or lower return depending on your travel habits.

Information about the Capital One® Venture® Rewards Credit Card and Capital One® VentureOne® Rewards Credit Card has been collected independently by CNBC and has not been reviewed or provided by the issuer of the cards prior to publication.

Editorial Note: Opinions, analyses, reviews or recommendations expressed in this article are those of the CNBC Select editorial staff’s alone, and have not been reviewed, approved or otherwise endorsed by any third party.