This credit card for foodies offers delicious rewards, but I won't sign up

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Capital One

• The Capital One Savor Cash Rewards Credit Card offers an insanely high rate of return for foodies - 4% back on dining and entertainment and 2% back at grocery stores.
• You'll also earn $500 in bonus cash after you use your card for $3,000 in purchases within three months of account opening.
• This card comes with no foreign transaction fees and the bonus earning tiers work for overseas purchases as well as spending incurred stateside.

While many cash-back credit cards offer a flat rate of rewards for each dollar you spend, some cards offer bonus categories that let you rack up more rewards on everything you buy. The Chase Freedom is a good example of this since it offers 5% back on your first $1,500 spent in special bonus categories each quarter plus 1% back on all other purchases, but there are plenty of other cards that fall into this category.

By seeking out cards that offer special bonus categories, you can find new ways to maximize your spending. This works particularly well if you spend more money in certain areas of your budget than most.

That's why I was intrigued by the new version of the Capital One Savor Cash Rewards Credit Card.

As someone who spends a lot of money on groceries since I have a family, I loved the idea of earning a flat 2% back at grocery stores. Even more, however, I am shocked by the fact this card offers 4% back on dining out and entertainment. While my husband and I eat mostly at home when we are around, we are traveling at least three months out of the year. This means a lot of dining out for us, which could lead to phenomenal rewards with this card.

Capital One Savor: The perfect card for foodies?

If you're someone who dines out often or spends a lot of money on food in general, you'll probably want to take note of the Capital One Savor and all it has to offer.

The insane value proposition starts with the $500 bonus cash you earn after signing up and spending $3,000 on your card within three months of account opening. On top of that bonus, you'll earn 4% back on dining out and entertainment and 2% back at grocery stores (as we already noted). You also earn 1% back on all other purchases, which is pretty standard for most cash-back categories with special "bonus categories."

Another big benefit this card offers is the fact that the annual fee is waived the first year. If you decide to keep the card after the first year, you'll pay an annual fee of $95.

The Capital One Savor doesn't charge any foreign transaction fees, and yes, the 4% and 2% bonus categories apply to dining and grocery purchases made outside the United States. The big caveat is that big-box stores like Walmart and Target are not counted as grocery stores, so you will only earn 1% back when you shop there - even if you're buying food.

The rewards you earn with this card are unlimited, meaning there are no caps on how much cash back you can rack up. Rewards are also easy to redeem since you can turn them into statement credits at a rate of one cent per point.

How much can a foodie earn their first year?

If you're someone who spends a lot on dining out and groceries like me, you're probably wondering how much you can earn with this card right away. You may also be wondering whether the Capital One Savor is a better deal than comparable cards. At the end of the day, this card's value proposition depends mostly on your personal spending style and habits.

With that in mind, let's work up a few imaginary numbers to estimate how much you might earn with this card during your first 12 months as a cardholder.

If you're a foodie who loves high-end ingredients and hard-to-find foods or a family with a few kids, it's easy to imagine you would spend $1,000 per month at the grocery store. That's $12,000 per year you can assign to the 2% rate, leading to $240 in cash back in this category alone.

Let's also imagine that you dine out twice per week - once at a more affordable establishment and another time at a fancy restaurant. It's easy to imagine you would spend $125 per week dining out that way, for a total of around $500 per month ($6,000 per year). Now tack on the fact that the 4% also applies to entertainment purchases, which includes things like movie theaters, tourist attractions, amusement parks, bowling alleys, live theater, concerts, and professional sporting events. It's easy to imagine you could spend another $200 per month on fun, right?

With 4% back on dining and entertainment, you would rack up another $336 in cash rewards.

To round things out, assume you put another $10,000 in miscellaneous spending on your card each year, leading to another $100 in rewards. Add in the $500 sign-up bonus you earn after using your card for $3,000 in purchases within three months for account opening, and your total first-year rewards work out to $1,176.

Considering you can redeem your rewards for statement credits to cover any purchase made with your card, that's $1,176 you could use for nearly anything - more luxurious dining experiences, for example, or even travel or gifts for someone else.

This is just an imaginary scenario, but you surely get the point. In summary, signing up for the Capital One Savor makes a whole lot of sense if you:

• Spend a lot of money at the grocery store each month
• Dine out extensively and wish to earn 4% back
• Want to earn points you can redeem for statement credits
• Don't have the desire to transfer your points to airline or hotel partners

Why I'm not signing up

While I've painted an attractive picture for why you might want to sign up for this card, the final bullet point above is the reason I won't be signing up. I love earning high rates of cash back for each dollar I spend, but I love having the option to transfer points to airlines and hotels even more.

I am a Chase enthusiast to my core, mostly because I can transfer points 1:1 to my favorite transfer partners such as Air France/Flying Blue, United MileagePlus, Southwest Airlines, World of Hyatt, and British Airways. As a result, I put all my regular spending (including dining) on my Chase Sapphire Reserve. While the Chase Sapphire Reserve only offers 3x points on dining and travel (and 1x points on all other purchases), I get considerably more value when I transfer points to airline and hotel partners.

The bottom line

If you're trying to decide on a new card to sign up for, make sure to think over how you prefer to redeem your rewards.

If you love being able to transfer to airlines and hotels, a flexible travel card may be ideal for you. If you're more interested in the ease and simplicity of cash back, however, check out the Capital One Savor.

For foodies who spend a lot on amazing meals, this card is hard to beat.

Click here to learn about the Capital One Savor from Insider Picks' partner: The Points Guy

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