Why the Chase Sapphire Reserve’s Annual Credit Is Far Better Than the Competition

Aug 25, 2016

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TPG Points & Miles Editor Sarah Silbert takes a closer look at one of the standout features of the recently announced Chase Sapphire Reserve Card: the $300 annual travel credit.

If you’ve been following TPG, you know that Chase recently introduced the Chase Sapphire Reserve, a premium travel rewards card with a generous sign-up bonus, a stellar 3x bonus earning rate on dining and travel purchases and a handful of other strong benefits. Today, let’s take a look at one perk in particular: the $300 annual travel credit.

The $300 Annual Credit

It’s easy to use this credit when even parking charges apply. Image courtesy of Shutterstock.

Many premium travel cards offer an annual travel credit — ranging in value from $100 (for the Premier Rewards Gold Card from American Express) to $300 (as offered by the recently updated Ritz-Carlton Rewards Credit Card).

The Reserve card doesn’t disappoint on this front — it includes a $300 annual travel credit of its own. Not only is that on the high end for this benefit, but it also applies automatically to all travel purchases. Any transaction that codes as travel — from hotels to airfare to car rentals and beyond — will qualify for the credit. Here’s a description of what Chase counts as travel, pulled from the issuer’s website:

Merchants in the travel category include airlines, hotels, motels, timeshares, campgrounds, car rental agencies, cruise lines, travel agencies, discount travel sites, and operators of passenger trains, buses, taxis, limousines, ferries, toll bridges and highways, and parking lots and garages. Please note that some merchants that provide transportation and travel-related services are not included in this category; for example, real estate agents, websites or owners that rent vacation properties, in-flight goods and services, on-board cruise line goods and services, sightseeing activities, tourist attractions, merchants within airports, and merchants that rent vehicles for the purpose of hauling. In addition, the purchasing of points or miles does not qualify in this category.

It’s hard to get more generous than that — pretty much any travel-related purchase you make should count toward the annual credit. This includes services like Airbnb and Uber along with hotel bookings, airfare and everything else listed above.

As for how this benefit works, you’ll see a statement credit automatically post to your account. Chase states that it will post the same day an eligible purchase does (for easier tracking), but it might not appear on your statement for 1-2 billing cycles. The annual credit is awarded each account anniversary year, and eligible charges made by authorized users also count toward the $300.

Chase Sapphire Reserve vs. the Competition

An annual travel credit can effectively bring down the annual cost of holding a premium credit card, but — as you’ll see below — the usefulness of this benefit varies quite a bit from card to card. Here’s a look at how the Reserve card’s $300 credit stacks up against other cards’ versions of the perk:

  Annual Fee Travel Credit Amount How It’s Processed Eligible Uses for Credit
Chase Sapphire Reserve $450 $300 Automatically applied All travel (see list above)
The Platinum Card from American Express $550 $200 To use the credit, you need to select a qualifying airline. Baggage fees, in-flight food and drink
American Express Premier Rewards Gold Card $195 (waived the first year) $100 To use the credit, you need to select a qualifying airline. Baggage fees, in-flight food and drink
Citi Prestige Card $450 $250 Automatically applied Airfare, baggage fees, lounge access, some in-flight purchases
Ritz-Carlton Rewards Credit Card $450 $300 You need to call in after using the card for an eligible purchase. Baggage fees, seat upgrades, in-flight entertainment, in-flight meals preferred lounge memberships or passes

As you can see, every annual travel credit but the Chase Sapphire Reserve’s has some significant restrictions. Here’s a more in-depth look at the other options, including info on their current sign-up bonuses:

  • With the Platinum Card from American Express, you need to select a specific qualifying airline before you can even use the $200 credit (you can change this credit once per year), and then you can only use the credit toward “incidentals” like baggage fees and in-flight meals — not actual plane tickets. Some customers have also had success using this credit to reimburse Amazon gift cards. The card’s currently offering a sign-up bonus of 60,000 Membership Rewards points after you spend $5,000 in the first three months.
  • The American Express Premier Rewards Gold Card offers the lowest annual travel credit of any card on the list ($100 per year), and it comes with the same restrictions as the Amex Platinum’s fee. However, it’s also the only option on this list with an annual fee south of $450: $195, and it’s waived the first year. The card’s currently offering a sign-up bonus of 25,000 Membership Rewards points — worth $475 — after you spend $2,000 in the first three months, though it’s worth checking the CardMatch tool to see if you’re eligible for a higher offer. While this card isn’t the best pick based on its travel credit alone, it could definitely be worth considering thanks to its 3x bonus category for airfare purchased directly from the airline.
  • The Citi Prestige Card‘s $250 credit is considerably more generous, since it automatically applies to airfare and lounge access fees as well as checked baggage costs and in-flight purchases. While this card will be dropping Admirals Club access and adjusting other perks next year and now offers a lower sign-up bonus (40,000 ThankYou points after spending $4,000 in the first three months, worth $640), it could still be worth it thanks to the air travel credit and the enormously lucrative 4th Night Free benefit.
  • The $300 travel credit on the Ritz-Carlton Rewards Credit Card can also cover a wide array of travel costs, from seat upgrades to lounge memberships, but it unfortunately doesn’t include actual airfare. Especially if you already have lounge access through another premium credit card, it could require some effort to use up $300 per year solely through incidentals — though it’s definitely worth maximizing this perk by using the full credit amount if at all possible. Just keep in mind that you’ll have to call in to get the credit applied to your account. This card’s currently offering a sign-up bonus of two free nights at a Tier 1-4 Ritz-Carlton property after you spend $4,000 in the first three months.

Compared to these other options, the Chase Sapphire Reserve‘s annual travel credit is much more generous. You’re virtually unlimited when it comes to which travel purchases are eligible — Chase’s very broad definition of travel when it comes to awarding bonus points on the Sapphire Preferred and now the Reserve card also applies to what qualifies for the credit — and you don’t need to pick a specific airline or call in to receive your statement credit.

Plus, the Reserve earns 3x points on travel purchases, so when you make a qualifying purchase you’ll get a return of 6.3% (based on TPG’s valuations) in addition to getting the charge wiped from your statement if you haven’t yet used up the $300 in credit.

Bottom Line

No matter where your travels take you, the $300 annual credit can lower your out-of-pocket expenses. Image courtesy of the Park Hyatt Maldives Hadahaa.

When it comes to annual travel credits, it’s hard to beat the Chase Sapphire Reserve — and currently no card does. Not only does it offer a generous $300 per year, but it also has the most generous terms of use. Even cardholders who only travel a few times a year will have no trouble maximizing this benefit thanks to Chase’s broad definition of what counts as travel, and unlike with other cards, the credit is applied automatically. Ultimately, this perk is one of several reasons to considering adding this premium card to your wallet (if you qualify under the 5/24 rule, that is!). We’ll be covering more of the Reserve card’s top features in the weeks to come, so stay tuned!

Have a question about the Chase Sapphire Reserve? Check out our Q&A. See these posts for more:

Featured image courtesy of the St. Regis Princeville.

How would you use this $300 credit?

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.

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.