Video Sunday Reader Question: Chase Sapphire Preferred® Card or Ink Bold

by on August 26, 2012 · 16 comments

in Chase, Chase Sapphire Preferred, Credit Cards, Video Blog Post

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Today we have a question from TPG reader Rhoda who is debating whether to keep her  Chase Sapphire Preferred® Card or Ink Bold card open.

“I have both the Chase Sapphire Preferred® Card and Ink Bold cards.  After the annual fee-free year is up, would it make more sense for me to keep only the Ink Bold and close the  Chase Sapphire Preferred® Card (because of the 5x office supple category)? I’d possibly like to keep the Ink Bold benefit of 2 free lounge passes per year. Aside from the 7% annual bonus of the CSP card, what would I be missing out on if I were to choose to keep the Ink Bold over the  Chase Sapphire Preferred® Card? My annual spend on both cards is about 50 to 60k.”

There are three considerations when deciding what card is most beneficial for you:

1. Whether you want a credit card vs. a charge card

2. Whether a business credit cards makes more sense than a personal credit card

3. Which bonus categories make the most sense for you

When using a charge card you have much greater spending power with no preset spending limits, although you do have to pay the balance off in full every month or incur potentially huge penalty fees. A credit card allows you to run a balance with lower fees than you would normally get hit with when using a charge card.

In terms of business versus personal credit cards, personal cards offer many more protections to cardholders. For example, a credit card company cannot change the terms of the card within the first year, and they have to give you written notice if they change the APR. Business credit cards are basically unregulated with higher interest rates and less protection since small businesses are seen as a greater risk to credit card companies. However, business credit lines are separate from personal credit lines, so if you do run a balance, it won’t drive down your personal score (due to high credit utilization).

Lastly, it’s important to analyze the bonus categories of each card in order to determine which is best for your spending patterns. While the  Chase Sapphire Preferred® Card is a personal credit card, you earn 2 points per dollar on all travel and dining (which includes subways, taxis, and parking as well as hotels, airfare and rental cars). With the  Chase Sapphire Preferred® Card you also get a 7% bonus every year on all points that you earn throughout the year which translates to earning 2.14 points per dollar on travel and dining and 1.07 points per dollar on everything else. The Ink Bold gives 5 points per dollar up to $50,000 on office supply stores, land line phones, internet, and cable and 2 points per dollar on gas and hotels. Depending on what you spend your money on, the Ink Bold, if leveraged correctly, can earn you more points. One way to max out your earnings at office supply stores is to purchase gift cards at Office Depot or Staples that you can use anywhere.

Personally, I am a big fan of  Chase Sapphire Preferred® Card since a lot of my transactions fall in the categories of travel and dining. To avoid fees, you could switch to the Ink Classic, which still offers the 5 points per dollar but has no annual fee. Or you could get the Ink Plus card for another 50,000 points and one more year of no annual fee.  Basically when trying to decide which card will be best for you, you should lay out how much you spend and what bonus categories most of your transactions fall into, and choose the card that earns the most points for you. If a card’s annual fee is higher than the value you get, its probably good to assess whether it makes sense to keep it open. Check out this post for information on when to cancel a credit card.

Disclaimer: The responses below are not provided or commissioned by the bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by the bank advertiser. It is not the bank advertiser's responsibility to ensure all posts and/or questions are answered.

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  • Dave

    Is it possible to get the ink bold for the signup bonus and then downgrade to the classic when the annual fee hits? If yes, I assume this wouldn’t incur another credit check??

  • Grant

    If you have the Chase ink bold charge card you should apply for the Chase ink plus credit card that way it buys you another year of no annual fees. After that and you can downgrade to the Chase ink classic card.

  • HighlandsDenver

    Wow, a video sitting in the pool? Honestly? I’d love to look out my apartment window and see someone filming a blog post this way- I’d laugh so hard.

  • thepointsguy

    You gotta switch things up once in a while! It was a nice day.. what can I say?

  • thepointsguy

    Good point.. I’ll add that to the post

  • Jamison

    a perfect day in the Hamptons to be in a pool ;)

  • sil

    Does the ink bold provide protection for Fraud? Will be using it on vacation and if there should be a charge I didn’t make, do I have same protection as a personal card?

  • Grant Thomas

    Thank you, that’s my strategy at least :)

  • thepointsguy

    Yes, does have fraud protection so you won’t be liable for unauthorized charges

  • thepointsguy

    Life is good!

  • Hunter

    Is there a signup bonus attached to the Ink Classic? In other words, could I downgrade my Ink Bold to an Ink Classic right before the annual fee hits and get another bonus?

  • Ncki

    I believe there are also differences between how charge cards and credit cards report to Fico. Correct me if I’m wrong, but I believe a credit card with a 10k limit and a 2.5k balance reports as 25% utilization ratio, whereas a charge card uses the most you have ever charged in a month as the upper limit. If that number is 2.5k, you would be at 100% ratio, which obviously hurts your score.

  • Rob P

    Yes and yes, since it’s a different card.

  • Rob P

    Yes you can downgrade to Classic (although it would be better to get the Ink Plus to get the same bonus and no annual fee the first year). I don’t think there’s a credit inquiry when you downgrade; hopefully someone here will clarify.

  • jason

    You are so posh!

  • Pandalam88

    I applied for a Southwest personal, a Southwest business credit card and Chase Sapphire Preferred card. I got approved for the first two and was turned down for a Chase Sapphire Preferred credit card. Seems like Chase is very much against multiple card applications within a short period. They are incredibly unflexible and would not even allow me to convert one of my existing cards even though I was willing to give up my free Freedom card for the Sapphire preferred that carries a $95 annual fee. I even offered to forgo the sign up bonus etc just to show my sincerity. Completely illogical…In my opinion, Chase seems to be evolving into the next Bank of America, service-wise.

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