Frequent diners: New Capital One credit card pays 3%

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Foodies get your forks ready.

Capital One just launched its Premier Dining Rewards card, which earns an unlimited 3 percent back on dining, 2 percent back on groceries and 1 percent on all other purchases. This is the highest unlimited cash-back dining reward currently available.

Other card highlights include:

  • No annual fee.
  • A $100 cash bonus if you spend $500 in the first 3 months of card ownership.
  • No foreign transaction fees.
  • World Elite Mastercard perks like travel upgrades and protections and concierge services.

According to a Capital One spokesperson, the card was created “to help our customers with a passion for food enhance their dining experience by rewarding them for what they enjoy most.”

Who this card is good for

If you’re someone who regularly dines out, this card may be a good fit, particularly if you’re a globetrotter. The combination of 3 percent cash-back at restaurants and lack of foreign transaction fee could make this card a compelling choice. But it’s best to pair this card with another credit card like one that offers generous travel rewards.

You may also favor a card like this if you don’t like the complexity of travel rewards cards, which have different redemption values based on how you trade-in your points. Chase Sapphire Preferred offers two points per $1 spent on dining, but you’ll pay a $95 annual fee to enjoy this card. The Chase Sapphire Reserve pays two points per $1 — worth just as much on a cash-back basis as the no-fee Capital One Premier Dining card — but you’ll pay a $450 annual fee.

Is it right for you?

Do the math. How much do you spend annually on dining out? The Bureau of Labor Statistics says the average household spent $3,008 on restaurants and takeout in 2015. If you’re the average family, that 90 bucks extra you’d earn every year from the Capital One Premier Dining card might not be worth the hassle of signing up. But what if you spend more than the average household? What if dining out represents a big portion of your monthly budget? This is a card to consider — especially because it comes with no strings attached: no annual fee and no cap.

Who it’s not good for

If your dining plans are mostly from the kitchen to the couch, there are other cash-back rewards cards that may offer greater benefits.

The American Express Blue Cash Everyday offers a $100 cash-back bonus if you spend $1,000 within the first three months of card ownership. The standard reward is 3 percent at U.S. supermarkets on up to $6,000 in spending annually, 2 percent at U.S. gas stations and select department stores and 1 percent on all other expenses — including dining.

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