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5 Reasons Chase Sapphire Preferred Should Be Your First Card in 2016

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TPG Senior Points & Miles Contributor Nick Ewen explains why applying for the Chase Sapphire Preferred can get your 2016 travel-rewards strategy off to a good start.

Choosing the best travel-rewards credit cards is a critical element in maximizing your points and miles, and a select few offer a wide array of perks that appeal to a variety of traveler profiles. Today I want to share my top five reasons why — if you don’t already have it — the Chase Sapphire Preferred Card should be the first one you get in 2016.

1. The Sign-Up Bonus

Back in November, Chase formally announced that the Sapphire Preferred Card would be increasing its standard sign-up bonus to 50,000 Ultimate Rewards points after you spend $4,000 in the first three months from account opening. You’ll also earn an additional 5,000 bonus points after you add the first authorized user and make a purchase in the first three months from account opening. If you meet both of these requirements, your haul is worth $1,155 based on TPG’s most recent valuations, and you won’t even need to pay the $95 annual fee during the first year of membership. This new bonus is a big reason why the card has regained its top spot in TPG’s monthly list of the best travel rewards credit card offers.

2. The Double Points on Dining and Travel

Here are some tips to raise your Uber rating.
Uber purchases will earn you double points on the Sapphire Preferred.

On the surface, this feature of the Sapphire Preferred Card may not sound that special. Many cards offer category bonuses for travel purchases and dining, but the real appeal of these bonuses is how wide the definitions span. Just like TPG, I utilize the Sapphire Preferred for most of my purchases, and just in the last three months, I’ve had the following purchases earn me 2x Ultimate Rewards points per dollar spent:

  • A beer hall (that didn’t serve food) in New Orleans
  • Street parking in Manchester, NH
  • Uber (multiple times)
  • Quarterly dues for the yacht club to which I belong in my hometown
  • A rental car
  • Tolls automatically billed to my SunPass in my home state of Florida
  • A local cupcake shop
  • Train transportation in France
  • A city tour of Zurich booked through the Zurich Tourism office
  • Tram tickets in Zurich
  • Parking at the Miami Airport (at a location that wasn’t classified as a travel expense when I used my Barclaycard Arrival Plus World Elite MasterCard there back in June)

TPG has also found that the delivery services Seamless and Postmates fall into these bonus categories, so if your hometown has these options, that gives you additional earning potential. I just wish that the 3x First Friday bonus was still in effect!

3. The Varied and Valuable Redemption Options

I'm excited to bring points and miles to Travel and Leisure.
Transferring Ultimate Rewards points to the KrisFlyer program can help you book Singapore Suites Class.

Ultimate Rewards points are among the most flexible and valuable currencies out there. You have a myriad of ways to redeem your points, including booking travel directly (where points are worth a flat 1.25 cents apiece). The big benefit of redeeming points this way for flights is that they typically do count toward elite status, but note that isn’t the case with hotel bookings.

However, these awards typically don’t allow you to use your Ultimate Rewards points for maximum value. To get the most out of your points, you usually need to transfer them to one of 10 partners, including Hyatt, Marriott and United.

When you transfer points to these partners, you’ll unlock terrific redemptions, such as the Park Hyatt Tokyo and Singapore Suites Class — and in some cases, TPG’s valuation of 2.1 cents apiece for Ultimate Rewards points can easily be eclipsed.

Remember too that the Sapphire Preferred is a terrific option if you currently have the Chase Freedom card. As Jason Steele wrote last year, Freedom isn’t just another cash-back card when it’s paired with a premium card like the Sapphire Preferred. Instead of just getting 5% cash back on the quarterly bonus categories (plus 1% cash back elsewhere), you can “convert” those fixed earnings to much more flexible Ultimate Rewards points, a key reason why the Chase Freedom is a no-brainer.

4. The Travel Benefits

There are several credits out there offering rental car elite status as a benefit
I haven’t had to use it, but having primary insurance coverage gives me peace of mind when renting a car and paying with the Sapphire Preferred.

In addition earning valuable rewards for making purchases while traveling, you can also take advantage of some fantastic benefits while on the road. For example, the Sapphire Preferred Card offers primary car rental insurance. This covers the entire loss, damage or theft of your car rental without reporting it to your insurance company, a benefit that can save you big time in the long term.

Another great money-saving benefit is the lack of foreign transaction fees on the card. While these appear to be gradually on their way out (cards like the American Express Premier Rewards Gold Card and Starwood Preferred Guest Credit Card from American Express recently removed them, for example), the Sapphire Preferred has always waived them, a benefit that’ll typically save you 2.7%-3% on every purchase abroad.

5. The New Card Restrictions

If you’re thinking about expanding your points and miles strategy to include opening and utilizing multiple credit cards, now’s a fantastic time to open the Sapphire Preferred Card. Card issuers have different application restrictions, and early last year, reports began to emerge of new and tighter rules when applying for any card that accrues Ultimate Rewards points. If you’ve opened five or more new credit cards in the past 24 months, it’s highly likely that your application for the Sapphire Preferred will be automatically declined. As a result, if you want to take advantage of the sign-up bonus and the other perks listed above, you should apply for this card sooner rather than later.

Bottom Line

Whenever I meet someone who wants to travel like I do, I immediately ask about a credit card strategy. I stopped traveling extensively for work more than a year ago, yet I’m still able to rack up hundreds of thousands of points and miles every year. The Chase Sapphire Preferred Card plays a big role in this. It’s a terrific starter card but also a great product for experienced award travelers, so if it isn’t currently in your wallet, definitely consider making it your first application of the new year.

For more information on the card, check out the following posts:

Are any of you planning on adding the Sapphire Preferred card to your wallet in 2016?

Chase Sapphire Preferred® Card

Apply Now
  • 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
Intro APR Regular APR Annual Fee Foreign Transaction Fee Credit Rating
N/A 16.24%-23.24% Variable Introductory Annual Fee of $0 the first year, then $95 0% Excellent Credit