Chase Sapphire and Chase Sapphire Preferred® Card Comparison – Which One is Right For You?

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Update:  As of July 20, 2014, the Chase Sapphire Preferred Card no longer offers the 7% annual points dividend. View the current sign up offer here.

One of the best things about Chase Ultimate Rewards is the variety of cards through which you can earn points, and what you can use those points for. However, the numerous options, including multiple versions of the Ink Bold, the Chase Sapphire Preferred® Card and the Sapphire can also be confusing for some consumer, let alone how similar the names are.

So I thought I’d do a quick comparison of the cards, what kind of consumer each would be best for, the differences among the redemption opportunities on points earned by each card (the Ultimate Rewards points you earn aren’t the same!).

First, a side-by-side comparison.

Chase Sapphire Chase Sapphire Preferred® Card
Current Sign-up Bonus 10,000 Ultimate Rewards points when you spend $500 in 3 months 40,000 Ultimate Rewards points when you spend $3,000 in 3 months
Spending Bonuses 2x points per dollar spent at restaurants 2x points per dollar on restaurants and travel (including airfare, hotels, taxis, parking and more)
Other Spend 1 point per dollar on all other purchases 1 point per dollar on all other purchases. 7% bonus at the end of the year on all points accrued, including the sign-up bonus
Foreign Transaction Fee 3% No foreign transaction fee
Annual Fee No annual fee $0 for first year, then $95
Other Features Can use points for fixed-value travel, gift cards and statement credits- 1 cent per point maximum 25% bonus when redeeming points for travel through Ultimate Rewards
Loyalty Program Partners None, points must be redeemed at a fixed rate for travel, merchandise or statement credits (cash back) Airlines: British Airways, United, Korean Air, SouthwestHotels: Hyatt, Marriott, Ritz-Carlton, Priority ClubOther: Amtrak

So now let’s get into the details of what each of these differences means for you.

Sign-up bonus: The Chase Sapphire Preferred® Card wins in terms of sheer quantity (by a 4:1 ratio!) but remember, you have to hit that $3,000 spend within 3 months in order to get it whereas you get the Sapphire’s 10,000 points for spending just $500 within 3 months. The Chase Sapphire Preferred® Card bonus used to be 50,000 and the Sapphire 25,000, so it’s possible they could increase in the future, but I don’t anticipate any movement in the near future.

Spending bonuses: Here at least there’s a bit of parity when it comes to restaurant spending—you get 2x points on each card. However, where the Chase Sapphire Preferred® Card’s real value becomes evident is the fact that you also earn 2x points on travel – related spending including on airlines, hotels, subways and even taxis and parking fees. The Chase Sapphire Preferred® Card is much better for people who live in cities and spend a lot in those categories.

Other spend: Chase Sapphire Preferred® Card, since you get a 7% bonus on all spend. So an everyday purchase earns 1.07 points per dollar (2.14 for the 2x categories) vs 1 with the regular Sapphire.

Foreign transaction fees: The Sapphire levies 3% which essentially negates the value of any points accrued, while the Sapphire Preferred has no foreign transaction fees. I tend to travel abroad a lot, so this is a consideration for me, but if you’re not planning on using the card outside the US, this might not matter so much to you.

Annual fee: The Sapphire card charges no annual fee, while the Chase Sapphire Preferred® Card has a $95 annual fee, though it’s waived for the first year.

Other features: Here the Chase Sapphire Preferred® Card pulls into the lead. You can use points you earn with the Sapphire card to redeem for travel at a fixed rate of 1 cent per point and you can also get statement credits at this rate. On the other hand, the Chase Sapphire Preferred® Card card nets you 1.25 cents per point, a 25% bonus when redeeming for airfare, hotel, car and cruises.  In addition, the Chase Sapphire Preferred® Card offers a 7% annual points dividend, which extends both to the sign-up bonus as well as to points you earned but might already have transferred or redeemed. Basically, any points you earn during the year, whether you’ve used them already or not, are factored into that 7%.

Partners: The Chase Sapphire Preferred® Card again wins here since Ultimate Rewards points earned with a Sapphire card cannot be transferred to partners, and may only be used for fixed-value travel and merchandise redemptions as well as statement credits. Ultimate Rewards points earned on the Chase Sapphire Preferred® Card card, however, can be transferred to United (Star Alliance awards, including one ways and low fees) British Airways (great for short haul awards on Oneworld partners like American Airlines), Southwest (Wanna Get Away fares), Korean (SkyTeam awards, like Delta), Hyatt (22,000 points for award nights at top tier Park Hyatts around the world), Priority Club (Pointbreak hotels), Marriott, Ritz-Carlton and Amtrak.

Deciding
So, which card is best for whom?

Sapphire: If you don’t take advantage of the bonus spend categories and you spend less than $592 a month and don’t need to use the card abroad, this card is for you. If you spend more than that monthly amount, then the 7% bonus and 25% increase in the value of the points would make up for the annual fee of the Chase Sapphire Preferred® Card. ($7,102 spend would earn 7,102 points x 1.07% for the annual dividend = 7,599 points at 1.25 cents a piece = $95). Another consideration is that the Sapphire is easier to get than the Chase Sapphire Preferred® Card, which is a more of a premium credit card.That being said, for someone looking to build credit with an intro card, I still think the Freedom is a smarter play – no annual fee and rotating 5x spend categories. Plus, you won’t have to worry about foregoing the Sapphire Preferred sign-up bonus when you decide to apply for it down the road.

Sapphire Preferred: If your ultimate goal is fantastic travel opportunities rather than cash back or statement credits, then the Chase Sapphire Preferred® Card is the card for you (and my all around favorite travel credit card). That being said, I don’t put all of my spend on the Chase Sapphire Preferred® Card – I put dining and travel (excluding airfare) and then the rest of everyday spend on my Freedom card, which gives a 10% bonus on all purchases plus a 10-point-per-transaction bonus since I’m a Chase Checking customer (read all about that feature here). However, if you are looking to get into travel point collecting, the Chase Sapphire Preferred® Card is a strong way to start out, since the 40,000 point sign-up bonus is higher than what most competing card products have and the Chase Ultimate Rewards program is great for topping up your transfer partner accounts, like United and Hyatt.

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