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Update: The offer mentioned below for the Platinum Card from American Express has expired. View the current offer here.
Update: The Chase Sapphire Preferred® Card sign-up bonus offer is now reduced to 40,000 points when you spend $3,000 in the first 3 months.
Update: As of April 2013, Chase Ultimate Rewards has added Virgin Atlantic as a new airline transfer partner.
As I wrote about last week, I recently got my Chase Sapphire Preferred® Card and I have to say I love it. Yes, it does get a little bit annoying when inevitably every store clerk gawks and asks me about it, but the value proposition of the entire Ultimate Rewards program trumps any minor inconveniences (like Payless Car rental rejecting it because they couldn’t take a manual imprint of the numbers since they are printed on the card and not raised).
For the longest time I thought American Express points were the only way to go. I have been an American Express customer for years and have practically been using Membership Rewards points since I learned how to walk. Well that might be a bit of an exaggeration, but I did first start using them when I was 12 years old.
This may be a little off topic, but here’s the story of how I got started with my points obsession. In the mid/early 90’s my dad took a job working from home and since he had secretaries his whole life, he didn’t know how to use the computer. Being entrepreneurial and leveraging my computer skills (then in the Prodigy/early AOL days) I was one of the first members of Travelocity.com and I made money off of booking his work flights. I’d also manage his points and miles and that’s when I first started realizing the value of loyalty programs.
When I was 13 I planned our family’s first Caribbean trip using points – all 6 of us were going to the Cayman Islands. Due to award availability, I routed my Dad and 3 siblings on US Airways nonstop from Philadelphia and my mom and I flew using American miles via Miami (no I didn’t splurge for first class – if I only knew what I know now!). For accommodations, I found and negotiated a great house on VRBO (which I still use to this day). I remember being terrified the night before the trip that everything could go horribly wrong (give me a little credit, I was 13!) but we ended up having the trip of a lifetime and have been back to Rum Point on Grand Cayman numerous times. And needless to say, all of my family members respect the points trade, though some are much better at it than others and I’ll leave it at that 😉
Back on topic, I still think American Express Membership Rewards is a good program. I put a lot of my spend on my Premier Rewards (domestic) and Platinum (international) cards, however after becoming more familiar with Chase Ultimate Rewards, I find there are five areas where Ultimate Rewards excel.
1) There is no fee to transfer points. American Express charges $6 per 10,000 points transferred to US frequent flyer programs for a “Airline Excise Tax Offset Fee.” Chase charges no such fees. To test this, I just transferred 1,000 Ultimate Rewards points to Continental and after a quick confirmation they were instantly in my account. I tried to do the same thing with Amex and had to pay 60 cents. Not horrible, but if you do a 100,000 point transfer you are looking at $60 in fees.
2) Chase is very flexible with external transfers. Unlike Amex, you don’t need to go through a linking process before transferring points. Chase just asks for the name of the person you want to transfer to (and it doesn’t have to be you). A couple clicks later and the transaction is done. This is amazingly helpful when family/friends need to top up accounts and you can come in and save the day, saving them potentially hundreds of dollars from having to buy miles directly from the airlines. Chase’s transfers are all instantaneous, whereas some of American Express’ can take several days (for partners like ANA and Singapore). American Express also lets you transfer to other people, but I just feel like Chase’s process is easier and more efficient.
3) Chase is very flexible with internal transfers. Chase allows points to be transferred to anyone else! For example, my friend who moved to Madrid had 2,000 points leftover in her Freedom account. She wasn’t going to use them, so she transferred them to me for free (all we had to do was enter my Chase Sapphire Preferred® Card number). Instantly I had 2,000 points that could be transferred to either United, British Airways, Korean Air, Southwest, Hyatt, Marriott, Ritz-Carlton, Priority Club or Amtrak. Awesome.
4) Ultimate Rewards Mall shopping points are reliable and post quickly. I recently posted about 2,500 and 4,500 point deals for signing up for Stamps.com and Pitney Bowes. Within 2 weeks I had those points in my account – normally you need to wait months and often track down vendors for your rightful points. So kudos to Chase for running a tight ship at the Ultimate Rewards shopping mall.
5) As a result of the flexible transferability of points, with Chase you can maximize the points you earn by taking advantage of other cards. For example, the no-fee Freedom card (which also comes with a 10,000 point sign-up bonus) gives 5 points per dollar on specific categories during the year. The Freedom card is supposed to be a cashback card, but instead you can transfer those points and major bonuses to your Ultimate Rewards account and then transfer them to the programs of your choice. So each quarter you can be earning 5 airline/hotel miles per every dollar spent in the category spend up to $1,500 quarterly. If this sounds confusing I highlighted this strategy in this post. FYI the bonus categories for Q4 (October-December) are:
To be fair, American Express blows chase out of the water in several areas, like breadth of transfer partners and transfer bonuses, but I’ll save that argument for another post
Overall, I am really impressed with the Ultimate Rewards program and hope they continue to add transfer partners, including United after the Continental Onepass ceases to exist as its own entity on January 1, 2012 (I’ve asked this question to the powers that be and will report back as soon as I hear anything, but my gut is that United will be a transfer partner once Continental disappears). Realistically, I’d also predict that Southwest will be added as a transfer partner in the future since Chase also manages their credit card offering. (Update: These programs have since come on as Ultimate Rewards transfer partners, as has Ritz-Carlton.) Whatever happens, I think it’s a good thing that there is competition on the market and I’d love for Citi, Capital One and any other major credit card player to start transferable points programs. The more options the better!
Chase Sapphire Preferred® Card
|Intro APR||Regular APR||Annual Fee||Balance Transfer||Credit Rating|
|N/A||16.24%-23.24% Variable||Introductory Annual Fee of $0 the first year, then $95||See Terms||Excellent Credit|