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The sign-up offer for the Chase Sapphire Preferred card has been increased from 40,000 to 50,000 points after $4,000 spent within the first three months. You can earn an additional 5,000 points when you add an authorized user and make a purchase within the first 3 months as well.
Update: Some offers mentioned below are no longer available. View the current offers here – Capital One VentureOne Rewards Credit Card, Capital One Venture Rewards Credit Card, United MileagePlus Explorer Card
TPG contributor Jason Steele comes back this week to analyze minimum spend.
Perhaps we are living in the golden age of credit card rewards, where banks are eager to offer us so many valuable points and miles just for giving them a chance to earn our business. Nevertheless, most of these offers require a significant amount of spending (often referred to as the “minimum spend”) in order to qualify for bonus offers.
Unless you normally spend a large amount for your household or business, you’ll need to weigh the rewards offered by each card against its spending requirement. If manufactured spending isn’t your thing, we thought it would be helpful to examine current credit card offers and analyze the rewards you’ll receive compared to how much you’d need to spend to earn them.
The chart below examines the value offered by various credit card signup bonuses. To calculate the total value, we considered the value of each type of point as rated by TPG in his monthly valuation series, and we factored in the cost of any annual fee charged in the first year of card membership. Finally, we divided the total value by the amount of required spend as a measure of which cards provide the most value for the least spending effort. Check the chart to see what we found.
|Personal Cards||Bonus||Min. Spend||Total Pts||Point Value||Total Value||1st Year Annual Fee||Value After 1st Year Fee||Value per $ /Spend|
|United MileagePlus Explorer||30,000||$1,000||31,000||1.4||$434||$0||$434||$0.43|
|Marriott Premier Rewards||50,000||$1,000||51,000||0.5||$255||$0||$255||$0.26|
|Southwest Premier Visa||50,000||$2,000||52,000||1.4||$728||$99||$629||$0.31|
|Southwest Plus Visa||50,000||$2,000||52,000||1.4||$728||$69||$659||$0.33|
|Ink Bold / Ink Plus||50,000||$5,000||55,000||2.1||$1,155||$0||$1,155||$0.23|
|Premier Rewards Gold||25,000||$2,000||27,000||1.7||$459||$0||$459||$0.23|
|Gold Delta SkyMiles||30,000||$1,000||31,000||1.2||$372||$0||$372||$0.37|
|Platinum Delta SkyMiles||35,000||$1,000||36,000||1.2||$432||$95***||$337||$0.34|
|Amex EveryDay Preferred||15,000||$1,000||16,000||1.7||$272||$95||$177||$01.8|
|Hilton HHonors Surpass||60,000||$3,000||63,000||0.5||$315||$75||$240||$0.08|
* Assumes you can transfer to Ultimate Rewards account that allows point transfers.
**Net after $200 statement credit.
***Net after $100 statement credit.
If you look at the value of the points and miles earned, per dollar spent meeting the minimum spending requirement, the cards with the smallest bonuses are actually favored. For example, the Frontier Airlines Mastercard from Barclaycard offers 40,500 total points after spending just $500, which we value at $417 after factoring in the annual fee (which isn’t waived the first year). Likewise, the Chase Freedom offers 20,500 total points worth $431 (assuming you can transfer to an Ultimate Rewards account) after spending just $500.
Other standouts include the Citi Platinum Select AAdvantage (American Airlines) card which offers 30,000 miles for just $1,000 minimum spending. Essentially, cardholders receive 31x miles per dollar for the first $1,000, which compares quite favorably to the 11x earned by the Citi Executive cards with the 100k offer for spending $10,000.
Of course, there is also the US Airways card and the Delta SkyMiles Reserve card, both of which offer their sign up bonuses after cardholders make their first purchase.
On the other end of the spectrum are cards like the Amex Premier Rewards Gold which offers 25,000 Membership Rewards points after $2,000 spent within 3 months and the Business Gold Rewards Card which also offers 25,000 points but cardholders must spend a considerable $5,000 on their card within the first 3 months. Even the current Starwood Preferred Guest Card from American Express that offers 30,000 bonus points (10,000 after first purchase and 20,000 after $5,000 spent within 6 months) only comes out to 7 points per dollar spent by the time the complete sign-up bonus is earned.
To be sure, there are many other criteria that you should consider before choosing your next card, for example, we didn’t take into account the cost of the annual fee. But if you have a limited capacity to meet minimum spending requirements, this is an important perspective to keep in mind.
With great transfer partners like United and Hyatt, 2x points on travel & dining and a 50,000 point sign up bonus, the Chase Sapphire Preferred is a great card for those looking to get into the points and miles game.
- Earn 50,000 bonus points after you spend $4,000 on purchases in the first 3 months from account opening. That's $625 toward travel when you redeem through Chase Ultimate Rewards®
- Named Best Credit Card for Flexible Travel Redemption - Kiplinger's Personal Finance, July 2016
- 2X points on travel and dining at restaurants worldwide & 1 point per dollar spent on all other purchases.
- Earn 5,000 bonus points after you add the first authorized user and make a purchase in the first 3 months from account opening
- No foreign transaction fees
- 1:1 point transfer to leading airline and hotel loyalty programs
- Get 25% more value when you redeem for airfare, hotels, car rentals and cruises through Chase Ultimate Rewards. For example, 50,000 points are worth $625 toward travel
- No blackout dates or travel restrictions - as long as there's a seat on the flight, you can book it through Chase Ultimate Rewards