What Makes the Chase Sapphire Preferred Card the Best Rewards Card

Jul 16, 2013

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Yesterday I posted about a study

that listed the Barclaycard Arrival Plus™ World Elite MasterCard® as the most rewarding travel rewards credit card.  Since it earns 2x on all purchases, has a very simple rewards structure that allows you to redeem points for travel charges via a statement credit, and gives 10% points back on travel redemptions, I can see why it would be a favorite among those who have no desire to be “miles and points gurus”.  While I like that card, it is not my #1 travel rewards credit card, and never will be…even for those new to miles and points.  However, what that article (and multiple emails from readers) taught me is that the Chase Sapphire Preferred® Card is very misunderstood.  That card got a ton of coverage on miles and points blogs for the first year or so after it was introduced, so I think it was just assumed that by now all are born with innate knowledge on why it is so valuable, but I am now certain that is very much not the case.

In fact, here is a snipit of an email I received just yesterday:

I have been comparing the Chase Sapphire and the Chase Sapphire Preferred cards. It looks like the only difference is the $95 annual fee.  Is the preferred card worth the $95 annual fee? 

This email is from someone who has been putting spending on a travel rewards card for some time, but wants to expand their card portfolio.  It was not from someone who is totally new to rewards credit cards, so at the risk of boring those who are very familiar with the Sapphire Preferred, I do think a refresher course is very much needed for those who don’t understand why it is the best personal travel rewards credit card.

What makes the Chase Sapphire Preferred Card the best personal travel rewards credit card is the transferability of points 1:1 to Hyatt, United, British Airways, Southwest, Marriott, IHG Rewards, Korean Air, Virgin Atlantic, Amtrak, and Ritz. 

Sure you can use your points toward travel charges at a rate of one point = 1.25 cents toward travel via the Ultimate Rewards portal, but if that is how you are predominately using your Ultimate Reward points, then in all honesty this is not the best card for you.  I would recommend looking at the Barclay Arrival card if that is how you prefer to use your points.  The best way to redeem your Ultimate Reward points with the Sapphire Preferred is to transfer them 1:1 to a program like Hyatt Gold Passport, United MileagePlus, or even Southwest Rapid Rewards when you have a specific redemption that you need them for.  The regular Chase Sapphire card may look like a good option as it does not have the $95 annual fee, but it does not offer the option of transferring your points to hotel and airline partners unless you also have the Sapphire Preferred and/or the Ink Plus® Business Card or Ink Bold® Business Card.

The beauty of the Sapphire Preferred over a card like the British Airways Visa or United MileagePlus is that you aren’t locked into just one type of rewards currency.  For example, if I only had a United card, and only earned United miles, then I would be sunk if there weren’t award availability on a Star Alliance carrier when or where I wanted to travel.  However, if I instead was earning Ultimate Reward points via the Sapphire Preferred, then I would also have the option of OneWorld carriers like American Airlines via the British Airways program, via SkyTeam carriers like Delta thanks to Korean Air, or even Southwest which has no blackout dates.  In that way, these points are valuable because they give you lots of options when it comes time to redeem.

The other really important thing to note about why these points are so valuable is that you have the option to redeem them for first class flights and/or very expensive hotel stays that you would need a whole bucket load of points for if you were using a system where one point equaled one cent toward travel.  For example, earlier this year I stayed at the Park Hyatt Beaver Creek during ski season at spring break, right on the mountain.  That room was easily selling for $400+ per night.  That would be at least 40,000 points if you were operating on a system similar to the Capital One Venture card or the Barclay Arrival card.   However, it is a just a flat 22,000 Hyatt points per night as a top tier Hyatt hotel.  Since I can transfer my Ultimate Reward points instantly to Hyatt 1:1, it was just 22,000 Ultimate Reward points instead of the 40K plus it would be with some other fixed value programs.

Another good example is if you ever dreamed of going to Europe (or anywhere else) in a lie-flat premium cabin seat.  Many, many families I know want to do that at least once.  It is fair to say that business class tickets to Europe usually cost at least $3,000+ RT per person (and often more).  That would be 300,000 points RT via most fixed value programs.  However, if you transfer to United, then it is just 100,000 points/miles, plus you can build in stopovers and/or open-jaws that may or may not be permitted on the ticket you purchase.

I know not everyone wants to redeem their miles and points for premium cabin travel or five star accommodations, but having the option to transfer to hotel and airline programs is so valuable even if all you want is an economy flight from Dallas to Orlando for 7,500 Avios that you can transfer 1:1 from Ultimate Rewards.  Odds are that is fewer points than if you were using a fixed value program since the flight would have to be about $75 or less to beat that points redemption.

Of course there are other benefits to the Chase Sapphire Preferred like access to the Ultimate Rewards shopping portal, no foreign transaction fees, 2x points on travel and dining, etc.  However, I’ll start and end with what makes this card so darned valuable: the transferability of points 1:1 to Hyatt, United, British Airways, Southwest, Marriott, IHG Rewards, Korean Air, Virgin Atlantic, Amtrak, and Ritz.  That is what makes this card secure in the #1 spot in personal rewards credit cards for newbies and old pros alike.

 

Disclaimer: I do receive commission if you are approved for some of the credit cards mentioned in this post.  As always, your support is very much appreciated.

 

Chase Sapphire Preferred® Card

WELCOME OFFER: 80,000 Points

TPG'S BONUS VALUATION*: $1,650

CARD HIGHLIGHTS: 2X points on all travel and dining, points transferrable to over a dozen travel partners

*Bonus value is an estimated value calculated by TPG and not the card issuer. View our latest valuations here.

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More Things to Know
  • Earn 80,000 bonus points after you spend $4,000 on purchases in the first 3 months from account opening. That's $1,000 when you redeem through Chase Ultimate Rewards®. Plus earn up to $50 in statement credits towards grocery store purchases within your first year of account opening.
  • Earn 2X points on dining including eligible delivery services, takeout and dining out and travel. Plus, earn 1 point per dollar spent on all other purchases.
  • Get 25% more value when you redeem for airfare, hotels, car rentals and cruises through Chase Ultimate Rewards®. For example, 80,000 points are worth $1,000 toward travel.
  • With Pay Yourself Back℠, your points are worth 25% more during the current offer when you redeem them for statement credits against existing purchases in select, rotating categories.
  • Get unlimited deliveries with a $0 delivery fee and reduced service fees on eligible orders over $12 for a minimum of one year with DashPass, DoorDash's subscription service. Activate by 12/31/21.
  • Count on Trip Cancellation/Interruption Insurance, Auto Rental Collision Damage Waiver, Lost Luggage Insurance and more.
  • Get up to $60 back on an eligible Peloton Digital or All-Access Membership through 12/31/2021, and get full access to their workout library through the Peloton app, including cardio, running, strength, yoga, and more. Take classes using a phone, tablet, or TV. No fitness equipment is required.
Regular APR
15.99%-22.99% Variable
Annual Fee
$95
Balance Transfer Fee
Either $5 or 5% of the amount of each transfer, whichever is greater.
Recommended Credit
Excellent/Good

Editorial Disclaimer: Opinions expressed here are the author’s alone, not those of any bank, credit card issuer, airlines or hotel chain, and have not been reviewed, approved or otherwise endorsed by any of these entities.

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