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Update: Some offers mentioned below are no longer available. View the current offers here – BarclayCard Arrival Plus World Elite Mastercard
Chase Sapphire Preferred and Barclaycard Arrival Plus have topped my list of best credit cards for travel awards for some time now, with the edge going to Sapphire Preferred for its valuable transfer partners and the lucrative 7% annual dividend on point earned each year. However, with recent benefit changes to both cards (and the announcement of that 7% dividend going away starting in 2016), I thought it was time to reassess the merits of each, and see if the challenger might be able to KO the champ.
Read on to find out what’s new for these cards, what stayed the same, and which one comes out on top.
Chase Sapphire Preferred
Chase recently announced a flurry of benefit changes, most importantly the discontinuation of the 7% annual dividend starting in 2016 and the addition of primary auto rental insurance, as well as an increase in trip cancellation/interruption insurance from $5,000 to $10,000. For those who rent cars often, that was great news. For those who don’t- not so much. Chase also made some more general changes to the Ultimate Rewards program, like getting rid of the bonus point offered for travel purchases made through the Ultimate Rewards portal (which affects all cards, not just Sapphire Preferred), and eliminating the Pay Yourself Back by check feature (which I generally advised readers to avoid anyway). These changes are immediate for new cardholders, though existing cardholders will see their benefits change gradually over the next 18 months.
The loss of the 7% dividend is significant. Sapphire Preferred earns 2x points on travel and dining, and 1 point per dollar otherwise. The annual points dividend upped those earnings to 2.14 and 1.07 points, respectively. I value Ultimate Rewards points at 2.1 cents each, so Sapphire Preferred previously offered an awesome return of 4.5 cents per dollar spent on travel, or about 2.25 cents per dollar spent elsewhere. Without the annual dividend, those numbers shrink to 4.2 cents and 2.1 cents, respectively. While both values are still respectable, the difference between 2.25 cents and 2.1 cents for regular spending is notable because that moves Sapphire Preferred from above to below the 2.2 cents per dollar offered by the Arrival Plus card.
The primary auto rental insurance definitely increases the card value, and the extra trip insurance is nice if you need it and qualify to use it. The other changes only affect the card indirectly, and I don’t think they’re severe enough for me to alter my valuation of Ultimate Rewards.
Barclaycard Arrival Plus
Back in May, Barclays announced an array of upgrades to the Arrival Plus card, including Chip and Pin capability, expanded travel redemption categories, and an extended redemption period (from 90 days to 120 days). While none of these changes impact the fundamental return of 1.1 cents apiece for Arrival Miles, redeeming them becomes a little easier, and the security chip (along with no foreign transaction fees) makes the card more useful overseas.
The strength of Arrival is in its 2x points earned on all purchases, and in the flexibility the miles earned – you can redeem for travel with any airline, hotel, rental car agency and more, so long as the charge is coded as an eligible form of travel. Redemptions for travel get a 10% rebate deposited back into your miles account, which means you effectively earn 2.2% towards travel for every dollar spent (actually, even more before you earn miles when you purchase travel- even if you later use miles to cover that expense, as we discussed in this post).
The Arrival Plus also has the advantage that when you redeem Arrival Miles for airfare and hotels, you’ll still earn miles, points, and credit towards elite status for your flights and stays, since you’re paying for them with a credit card and then getting reimbursed. This can also be done with Sapphire Preferred through the Ultimate Rewards Travel Portal, where you can redeem points for 1.25 cents apiece, though the options are mildly limited compared to Arrival and you don’t earn Ultimate Rewards points on the actual redemption, like you do with Arrival Plus.
Looking Under the Hood
Sapphire Preferred had a mixed bag of changing benefits, while the updates to Arrival Plus were all positive. Here’s how they stack up side by side.
|Features & Benefits||Sapphire||Arrival||Winner|
|Sign-up Bonus||50k points with $4,000 spending in 3 months||40k points with $3,000 spending in 3 months||Sapphire|
|Base Earning||1 point/$||2 points/$||Arrival|
|Travel/Dining Earning||2 points/$||2 points/$||Sapphire|
|Chip Tech||Chip and Signature||Chip and PIN||Arrival|
|Annual Fee||$95 (waived first year)||$89 (waived first year)||Arrival|
|Flexibility||11 partners, Ultimate Rewards Travel Portal||Any qualifying travel expense||Sapphire (*)|
|Other Benefits||Visa Signature, Primary rental insurance||World Mastercard, Free FICO credit score||Sapphire|
The Real Winner Can Only Be Decided By You
For me, the edge is still towards the Sapphire Preferred because I know how to maximize their transfer partners to actually get much more than 2.1 cents per point in value (like my recent trip to the Maldives using Ultimate Rewards points transferred to Unite or my sweet Park Hyatt Sydney room using points transferred to Hyatt). However, my situation is that I was only booking for me and my schedule is extremely flexible and both of those redemptions have gone up due to Hyatt and United devaluations that have occurred this year after I booked those trips. This goes to show that the transfer partner game is high stakes- you need to be knowledgable and flexible in order to make it work- something not all cardholders can afford to do- especially if you’re a family and trying to book multiple seats on non-stop flights. In that case, bulking up on Arrial Miles may be a more valuable option- especially since you can cover so many other travel expenses using Arrival Miles, like amusement parks and AirBnb.
The difference between Chip/PIN and Chip/Signature technologies is notable, but less substantial than the difference between primary and secondary auto rental insurance, which favors Sapphire Preferred. The free FICO score feature with Arrival is also useful, but you can get free credit scores elsewhere, so it doesn’t add much value in comparison.
For those who are having trouble deciding, the good news is that there’s really no need to limit yourself to one card or the other. I have and use both cards regularly; each one has its place. I often preach that diversifying your points and miles is a good idea, because when programs (inevitably) devalue, you won’t get hit as hard by being too heavily invested in one loyalty currency. Arrival Miles are a great means of diversification because they have a fixed redemption value, and because they can be use toward almost any travel expense, which helps fill in the gaps left by other rewards.
So the king of cards still reigns, but if you have room in your wallet for both, you’ll find ways to use them.
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