What many people don’t realize is that there’s a no annual fee version of the card — the Spark® Miles Select from Capital One®. I wanted to provide an in-depth comparison of the two cards, for any small business that might be trying to decide between these two. Is one card an obvious choice over the other?
Spark Miles Vs. Spark Miles Select Card
When it comes to deciding which card is right for your small business I’d recommend considering the annual fees, the sign-up bonuses, the return on spending, and the perks. How do those factors compare between the two cards? Personally I think the Spark Miles Card is the obvious winner, though everyone can decide for themselves.
Comparing Spark Miles Card annual fees
To compare the annual fees on the two small business Capital One Spark products:
- The Spark Miles Card has a $95 annual fee, though it’s waived for the first 12 months
- The Spark Miles Select Card has no annual fee
Long term there’s a $95 difference between the two annual fees, while in the first year you won’t pay an annual fee on either card. Of course many people prefer a no annual fee card for good reason, though in this case I think the annual fee more than warrants the perks on the premium version of the card.
Comparing Spark Miles Card sign-up bonuses
Sign-up bonuses are a big incentive for people to apply for credit cards, and there’s quite a difference between the offers on the two cards:
- The Spark Miles Card offers 50,000 Spark miles after spending $4,500 within three months
- The Spark Miles Select Card offers 20,000 Spark miles after spending $3,000 within three months
Capital One miles are worth a minimum of one cent each toward a travel purchase, though personally I value Capital One miles at 1.7 cents each. So the difference between the two bonuses is 30,000 Spark miles, which are worth a minimum of $300, but which I value at $510.
Looking at it another way, the difference in bonuses could more than cover the annual fee on the Spark Miles Card for at least the first four years (since it’s waived the first year anyway).
Comparing Spark Miles Card rewards structures
Both Capital One Spark Miles cards have straightforward rewards structures, which give you a lot of flexibility with your travel rewards:
- The Spark Miles Card offers 2x Spark miles per dollar spent
- The Spark Miles Select Card offers 1.5x Spark miles per dollar spent
The cards also offer 5x Spark miles for hotel and rental car bookings through the Capital One Travel portal.
Spark miles can be redeemed for a minimum of one cent each toward the cost of a travel purchase, or they can be transfered to a Capital One airline or hotel partner, typically at a 1:1 ratio. While I value Capital One miles at 1.7 cents each, many others value Capital One miles at closer to one cent each.
This means for every dollar spent:
- The Spark Miles offers 2x Spark miles, which is a 2-3.4% return on spending
- The Spark Miles Select offers 1.5x Spark miles, which is a 1.5-2.55% return on spending
One awesome thing is that both cards have no foreign transaction fees. This is pretty rare for a no annual fee business card, so that’s a major reason to consider one of these cards. Actually, the Spark Miles Select is the only no annual fee business card earning transferable points with no foreign transaction fees.
Comparing Spark Miles Card perks
The Spark Miles Card has much better perks than the Spark Miles Select Card.
For one, the Spark Miles Card offers a TSA PreCheck or Global Entry fee credit once every four years, while the Spark Miles Select Card doesn’t. If that’s something you could benefit from, then that changes the first year math between the two cards even more.
On top of that, the Spark Miles Card offers lounge access twice every year to any of the following lounges, just by presenting your card, which is something the Spark Miles Select Card doesn’t offer:
- You can access Capital One Lounges; so far the Capital One Lounge DFW is open, and it’s amazing
- You can access 100+ Plaza Premium Lounges, including Virgin Atlantic Clubhouses in the United States
You can use your two annual lounge visits either for two separate visits just for you, or you can use them for a single visit with a guest. While there are of course other cards that have more comprehensive lounge access perks, they almost always have steep annual fees. This is a pretty awesome perk for a card like this.
Which Spark Miles Card is better for you?
If your small business is still deciding between the Spark Miles Card and Spark Miles Select Card, let me share a couple of further points to consider.
Breakeven point on spending
Taking the sign-up bonuses and annual fee waived for the first year out of the equation, long term what’s the breakeven point between the two cards?
There’s a $95 difference between the annual fees, and the difference in earnings rates is 0.5 Spark miles per dollar spent. Capital One miles are worth 1.0-1.7 cents each, so:
- At a valuation of 1.0 cents per Capital One mile, you’d recoup the $95 annual fee after $19,000 of annual spending
- At a valuation of 1.7 cents per Capital One mile, you’d recoup the $95 annual fee after ~$11,200 of annual spending
While the math will vary, that’s not necessarily a huge amount to spend. And that doesn’t factor in all the incremental perks of the Spark Miles Card, like lounge access, a TSA PreCheck or Global Entry credit, etc.
The option to downgrade your card is valuable
Regardless of which card you think makes more sense for your small business long term, I think applying for the Spark Miles Card makes a lot more sense:
- I would apply for the Spark Miles Card; it has a much better bonus (by 30,000 Spark miles, worth $300-510), the annual fee is waived for the first year, the rewards structure is 33% better, and you can take advantage of the TSA PreCheck credit and lounge access perks
- After the first year decide how you like the Spark Miles Card:
- If you’re getting value out of it (which I think most people will), continue using it
- If you’re not getting value out of it, after a year you can call Capital One and downgrade it to the Spark Miles Select; you keep all the Spark miles you already earned
There’s virtually no downside to this. If you downgrade the card after a year you’ll have received the much better bonus, the better Spark mileage earnings rates, and the fee is waived anyway.
I think many may find that the Spark Miles Card is worth keeping over the Spark Miles Select Card, and this way you have the flexibility to decide after a year.
Capital One Venture Cards have a similar dilemma
Capital One has some consistency between personal and business credit cards. There are lots of parallels between the Spark and Venture cards, with the former being business cards and the latter being personal cards (though the mileage currency they earn is the same, for all practical purposes)
In the past I’ve compared the three cards belonging to the Capital One Venture portfolio, including the:
- The Capital One VentureOne Rewards Credit Card (review)
- The Capital One Venture Rewards Credit Card (review)
- The Capital One Venture X Rewards Credit Card (review)
Just as with Capital One Spark products, I also find that the value proposition of Capital One Venture products is better the more premium you get.
While the Capital One Venture X has a $395 annual fee, I’d argue the benefits more than offset it, including the $300 annual travel credit, 10,000 anniversary bonus miles, a Priority Pass membership, unlimited access to Capital One Lounges, unlimited access to Plaza Premium Lounges, primary rental car coverage, cell phone protection, and incredible authorized user perks.
Capital One Spark Miles are some awesome business credit cards. Personally I think picking up the Spark Miles Card is a no-brainer, given all the great perks it offers. The card has a much bigger bonus, a higher return on everyday spending, better perks, and an annual fee that’s waived for the first year.
If you decide after a year that you don’t want to pay an annual fee, you should be able to downgrade to the Spark Miles Select Card without issue, giving you the best of both worlds.
What’s your take on the value of the Spark Miles and Spark Miles Select cards?