If you’ve been at this miles and points things awhile, this piece isn’t for you — hopefully, you realized that just by looking at the title. If you’re newer to using credit cards to earn points and miles for travel, stick around. We’re going to take a look at one of the most talked about cards on the market: The Chase Sapphire Preferred Card.
For years it has been the go-to starting point for those getting into miles and points, but should it still be the first choice? We’d argue that the case for it isn’t quite as clear as it used to be. Let’s take a look at what it has to offer so you can decide for yourself.
Great Sign-Up Bonus
If you’re going to give a new credit card a try, you might as well get a decent sign-up bonus out of it. Fortunately, this is a strong point for the Chase Sapphire Preferred. It comes with a sign-up bonus of 60,000 Ultimate Rewards points and a minimum spend requirement of $4,000 within 3 months of opening the card. As always, make sure you can hit the minimum spend before opening the card.
Decent Bonus Categories
Only a few years ago, we would have said great things about the 2X Ultimate Rewards points you can earn on all dining and travel purchases. Don’t get us wrong, the broad travel category is still very useful but the credit card landscape has changed. More cards offer bonus categories and stronger bonus categories these days — the Sapphire Preferred’s big brother, the Chase Sapphire Reserve.
It’s tough to stand out with 2X on dining and travel when other cards are earning 3X, 4X and even 5X on these categories. Even more so, when this card only earns 1X on all other purchases. In the end, the strongest bonus category is travel as it covers more types of purchases than some competitors.
Chase Travel Portal
While all cards that earn Ultimate Rewards points have access to the Chase Travel Portal, you need what we like to call a premium Ultimate Rewards card. Basically, you need one with an annual fee. The Sapphire Preferred comes with an annual fee of $95 so it’s on the cheaper end of travel rewards cards.
By having this card, your Chase points are worth 1.25 cents per point in the Chase Travel Portal which can be particularly useful when cash flights are cheap. If you only had the Chase Freedom, Chase Freedom Unlimited or the Chase Ink Business Unlimited, your points would only be worth 1 cent per point. Alternatively, your points are also worth 1.25 cents each with the Chase Ink Business Preferred and an even better 1.5 cents each with the Sapphire Reserve.
Let’s take a second to consider what 1.25 cents per point really means. Let’s say you want to go to Europe and flights on Star Alliance carriers such as SWISS or Lufthansa can be booked with United miles. You’d need 60,000 United miles plus any taxes and fees. Not a bad option and United doesn’t pass on surcharges so the cash cost wouldn’t be too high.
If a cash ticket on the same (or similar) flights were only $500, you would only need to use 40,000 Ultimate Rewards points in the Chase Travel Portal. Those 40,000 points would also cover the taxes and fees so you wouldn’t owe any cash. That’s a savings of 20,000 points plus some cash. To top it off, you could earn a few miles in your chose Star Alliance program as a small rebate. Considering the cash prices of some economy tickets these days, there are lots of opportunities to save tons of points by booking through the portal
Great Airline And Hotel Transfer Partners
We alluded to it in the previous section but Chase Ultimate Rewards has 9 airline partners and 3 hotel partners. You can transfer your Ultimate Rewards points to any of these partners at a 1:1 ratio then book award flights and award stays. Here’s a complete list of Chase’s transfer partners:
|Airline Partners||Hotel Partners|
|Aer Lingus AerClub||IHG Rewards Club|
|Air France-KLM Flying Blue||Marriott Bonvoy|
|British Airways Executive Club||World of Hyatt|
|Singapore Airlines Krisflyer|
|Southwest Airlines Rapid Rewards|
|Virgin Atlantic Flying Club|
While the Chase Travel Portal can be very useful, it’s not always your best choice. This is especially true if you want to book an international business or first class ticket. As the cash costs of these tickets out of the US are often quite steep, it can take a ton of points in the portal. Let’s consider the simple example of flying business class from New York (JFK) to Madrid (MAD) round-trip.
We’ll use a $2,400 business class ticket on Iberia — which is on the cheaper side for this route — as our price point. If you booked with Chase points via the portal, you’d need 192,000 points to book. Instead, you could transfer 68,000 Ultimate Rewards points to Iberia Plus to book an award ticket. If you include the taxes and fees on the award ticket, you’re looking at a total cost of 68,000 Iberia Avios plus about $210. Booking an award ticket is the clear winner in this case.
Don’t even get us started on the insane round-trip ANA first class ticket you can book with 120,000 Virgin miles from the east coast. That flight often goes for $20,000 to $24,000. If that’s not insane value then I don’t know what is!
Make sure you check out some of the best ways to use Chase Ultimate Rewards points!
Solid Trip Protection Benefits
A useful perk that comes with the Chase Sapphire Preferred is trip delay and baggage delay coverage. Trip delay can come in handy if you have an extended delay because of weather or air traffic control issues. While airlines are clearly in no mood to help unless they are the reason you’re delayed, you can be reimbursed for expenses if you paid for your flight with the Sapphire Preferred.
To be eligible, your flight must be delayed for at least 12 hours or overnight. If you run into this situation, you can get reimbursed for reasonable expenses such as food, lodging, toiletries, and other personal use items up to $500.
Similarly, if your bags are delayed by more than 6 hours, you’ll be eligible to use $100 per day for 5 days to cover essential items such as clothes, toiletries and even one cell phone charger. While it’s not something you’ll experience a lot, you’ll like having the coverage if it happens. It’s certainly come through for us in the past.
The one tough part with the trip delay coverage is that the delay must be 12 hours or overnight. If you have an 8:00 am flight home and it’s delayed until 7:00 pm, that’s a long time to wait and your food won’t be covered unless the delay is extended beyond 8:00 pm. Ouch.
Primary Rental Car Coverage
While many cards provide secondary collision damage waiver (CDW) coverage, the Sapphire Preferred has primary coverage. If you’re traveling with someone, as long as they’re listed as an authorized driver in the rental contract, the coverage is still in effect when they’re driving. This means you can decline the collision damage waiver offered by Hertz, Enterprise, Avis, or any other rental car company. To be clear, you need to decline it to be eligible for the primary coverage from the Chase Sapphire Preferred.
How Does It Compare To the Sapphire Reserve?
For a card with a $95 annual fee, the Chase Sapphire Preferred is a really good card. However, with the launch of the Chase Sapphire Reserve in August 2016, the Sapphire Preferred really took a hit. If you know you’ll travel a bit and dine out a decent amount, it’s really hard to see how the Sapphire Reserve isn’t a better long-term choice. Let’s break it down so you can see what we mean.
Earning And Burning Points
If you’re going for the biggest sign-up bonus, the Sapphire Preferred wins on this front with a bonus of 60,000 Ultimate Rewards points which is 10,000 more than of 50,000 points that come with the Sapphire Preserve. Both cards come with the same minimum spend requirement of $4,000 so it’s a clear win and worth considering.
The Sapphire Reserve jumps ahead on the bonus categories of travel and dining as it earns 3X rather than 2X. If you have a lot of spend going toward restaurants, Uber, Lyft, taxis, trains, hotels and cash flights, the edge clearly goes to the Reserve.
When it comes to using Ultimate Rewards points, the Sapphire Reserve again comes out ahead as it has access to the same transfer partners but points are worth 1.5 cents each in the portal compared to the Sapphire Preferred’s 1.25 cents each. It’s one of the reasons why we say it’s the best card for those who like to book flight deals.
Then you have trip delay coverage. With the Sapphire Reserve, if your flight is delayed by more than 6 hours, the benefit kicks into action. That’s half the time you would have to wait with the Sapphire Preferred. If you’re stuck in an airport all day, that matters. The Sapphire Reserve also comes with the same primary CDW when renting a car during your travels.
Beyond that, the Chase Sapphire Reserve also comes with a Priority Pass Select membership which gives access to over 1,200 airport lounges around the world — and you can bring a guest at no extra charge. Priority Pass has also partnered with many airport restaurants where you can get about $28 toward a meal for yourself and $28 for your traveling companion — or someone you meet along the way.
Taking The Annual Fee Into Consideration
Finally, we come to the annual fee. The Sapphire Reserve scares people away with its $450 annual fee. It does come with a $300 travel credit, though, which reimburses you for the first $300 in travel expenses you pay for with the card each cardmember year. If you would spend $300 on flights, hotels, Uber, etc. anyway, you’re effectively paying $150 for the card.
What It All Means
So, $150 for 3X on dining and travel, 1.5 cents per point in the portal, great trip delay coverage, airport lounge access and restaurant credits. Or, $95 for 2X on dining and travel, 1.25 cents per point in the portal and solid trip delay coverage. That’s the decision you have to make.
Who Should Get The Sapphire Preferred?
At this point, you’re probably thinking we’re simply huge fans of the Sapphire Reserve and don’t care for the Sapphire Preferred. Well, yes and no. We’ve certainly come to the conclusion that the Sapphire Reserve will be the long-term winner for people who travel but there are certainly times when the Sapphire Preferred is the right choice.
Look, getting a new card is a big decision for many people. We get that. If $95 upfront and 60,000 Ultimate Rewards points make you feel more comfortable than $450 and 50,000 points, that totally makes sense. You get a little more for trying out Chase and you don’t have to commit quite as much.
Additionally, for those who don’t travel to airports with Priority Pass lounges or restaurants, that perk might not mean much to you and thus doesn’t really bring added value to the table. If this is the case, testing the Ultimate Rewards points waters with a $95 annual fee might be more comfortable.
Don’t Forget Chase’s Approval Restrictions
While there’s room for debate between these two cards as a starting point for people new to the miles and points world, the Chase 5/24 rule makes one thing clear and it’s that you need to start with Chase. Specifically, you’ll want to start with earning Chase Ultimate Rewards points so you can take advantage of the transfer partners and travel portal.
All things considered, if you know you’re going to be traveling quite a bit, the Sapphire Reserve just has the Sapphire Preferred beat. However, you can always get the Sapphire Preferred and see what you think over the course of a year.
Once that year hits, you can take a look at your spending and compare it to what you would have earned with the Sapphire Reserve and consider what value you might have received from the Priority Pass membership. At that point, you feel the big boy card would be a better play, you can always product change to a Sapphire Reserve.
In fact, if you think you’ll get more value out of 10,000 more points from the Sapphire Preferred’s sign up bonus than Priority Pass, that might be exactly what you want to do.
Great analysis however, if you consider the higher point redemption value for Reserve at 1.5… you will realize that the bonus is essentially the same for both cards. Whether 60k points with preferred or 50k with reserve, both worth $750 redeeming for travel.
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