Capital One No Hassle Rewards – Gift Cards

Using Capital One Reward Miles for Gift Cards

credit cardsNow that Citibank has decided to nearly double my interest rate (from 9.99% to 16.99%), I am re-evaluating my Capital One Miles Plus card.  One of the great benefits I used to get from my Capital One MasterCard was the ability to redeem point for gift cards.  I furnished my daughters bedroom on the back of 2 $250 Toys R Us gift cards.  They used to cost 10,000 points for a $100 gift card.  In other words, a 1% redemption rate.

But, the cost has seemingly doubled.  The recent Capital One No Hassle Miles Holiday Reward Catalog lists several gift cards, all at a rate of 20,000 points for a $100 gift card, or just 0.5% which sounds just terrible.

Some examples:

  • Barnes & Noble $50 Gift Card = 10,000 miles
  • Blockbuster $50 Gift Card = 10,000 miles
  • Nordstrom $100 Gift Card = 20,000 miles
  • Sak’s 5th Avenue $100 Gift Card = 20,000 miles
  • Toys R Us $100 Gift Card = 20,000 miles

It is that last one that hurts the most because I know for a fact I got that for the better rate before.

But, there is a new wrinkle.  Earning points is different now too.

Earning No Hassle Reward Miles

The card used to earn 1 mile per dollar, so figuring out the monetary value of rewards was pretty easy, but things have changed.

The Capital One Miles Plus MasterCard earns 2 miles per dollar at certain stores:

  • Book Stores
  • Gift, Card & Novelty Stores
  • Art Supply Stores
  • Craft Shots
  • Florists
  • Video tape rental stores (no word on whether this century technology video rentals like DVDs are ok)

Then, the Capital One card earns 1.25 miles per dollar spent every where else.

So, theoretically, I would be getting the same return as before for those 2 miles per dollar shopping spots, but 75% less return for everywhere else.

To break it down, here is the monetary return on Gift Cards from the Capital One Rewards Catalog:

10,000 miles / 1.25 miles per dollar = $8,000 dollars spending = $50 Gift Card = 0.625% Cash Back Equivalent

Considering there is no shortage of companies that will over card holders 1% cash back, the Capital One Miles Rewards Card moves to a FAIL for gift card rewards.

We’ll take a look at travel rewards next. If they aren’t much, much, better, then I guess it will be time to analyze rewards cards again.


Technorati Tags: Capital One,Rewards,Credit Cards,Redeem Points,Gift Cards,Rewards Catalog

10 thoughts on “Capital One No Hassle Rewards – Gift Cards”

  1. I use Capitol One. Recently they tried to hit me with a yearly card fee. I refused and threatened to cancel the card. They rolled over and did not charge me. Try it out!

    • That works sometimes, but beware if you have a lot of Capital One miles already saved up. Then, your leverage is a lot lower. “Oh, you want to cancel? I understand. Just realize that when you do, you’ll lose your 89,323 miles.” – Doh!

      You can use them up, but by then the annual fee will already be stuck and you won’t get them to roll it back.

      The moral of the story is to use up your points before you need to cancel 🙂

  2. I am so done with this company. I spent more than 10 years with an credit card fixed interest rate under 10 percent, paid all my bills on time, and now they’re raising my interest rate to 18 percent. I called the company to complain, spent 45 minutes on hold before I got an answer, then finally got a succession of foreign people who can barely speak English who are obviously outsourcing Capital One’s billing. So they’re screwing employees and customers. They didn’t adjust my rates as most companies are doing these days, and instead offered me some gimmicky deal that ultimately sets my interest rate at an even higher level.


    • Carl,
      Unfortunately, it seems like this is not an isolated thing. Many companies are pulling the same kind of thing, even on their best customers. The most important thing is to not forget. Use all your points, and then throw the card in a drawer and leave it there. Never use it except to take advantage of specials that are favorable to you. They’ll never notice on the macro level, but you can at least not be a sheep led to the slaughter.

  3. Capital one is a JOKE ,now–in the past they had great rates on airline tickets . For 70,000 points I could get 2 tickets on any airline from Washington , DC to Puerto Vallarta,Mexico, 35,000 to Mexico per ticket. The last time I checked it would cost me 60,000 per ticket because the going rate ,now, is over $350.00 per ticket. They changed the rules in the middle of the game –so get out and don’t play their silly game . There are plenty of other companies that will give you better rewards. I just payed my last payment off and I am DONE with Capital One and their BS. This a POOR and unexceptable company with all that is happening to our economy.

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