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Choosing the right travel rewards credit card (or cards, as the case may be with, ahem, some people) can be a tricky proposition. The sheer volume of options can seem overwhelming, but it’s a critical decision to make the most of your everyday purchases and unlock valuable rewards like free hotel stays and award flights. Today we’ll take a look at one card in particular to see who should (and should not) open the Chase Sapphire Preferred Card.
Before getting into my recommendations, let’s start with a quick review of the key benefits on the Sapphire Preferred. The card is currently offering a sign-up bonus of 50,000 points after you spend $4,000 on purchases in the first three months from account opening. That’s $625 in travel when you redeem through Chase Ultimate Rewards.
You can also utilize some terrific earning rates on the card, as you’ll receive 2x points per dollar spent on travel purchases (covering a wide variety of merchants, including Uber and Airbnb) and 2x points per dollar spent when dining out. You can also utilize the Ultimate Rewards shopping portal to boost the value you get from your online purchases.
There are a handful of other key perks on the card:
- No foreign transaction fees
- Primary car rental coverage, saving you from filing a claim with your own insurance company when your rental car is damaged
- Trip delay/cancellation insurance
- Lost luggage reimbursement
- Price protection coverage
All of this comes at a small price, as the card carries an annual fee of just $95 (which is waived for the first year).
Who should get the Sapphire Preferred?
Now that you’ve had a quick refresher on the card’s features, does the Chase Sapphire Preferred Card make sense for you? Here’s a quick rundown of who should add this card to their wallet:
If you’re looking for your first card with an annual fee
I have a confession to make. This is hard for me to say, but…I used to completely avoid cards with annual fees (whew, I feel better now). I just didn’t see the point in paying for a credit card when I could get a different one for free. However, I quickly came to recognize how valuable these cards can be. As we’ve written about before, the Sapphire Preferred is a great starter card for someone just getting into the points and miles hobby. You may have focused on fixed-value cards in the past, since many of those don’t carry an annual fee, but if you’re ready to dive deeper into maximizing your earnings and redemptions, the Sapphire Preferred could be a terrific option.
If you have the Freedom and/or Freedom Unlimited
Another great candidate for the card is someone who already has either the Chase Freedom or Chase Freedom Unlimited cards. Combining the Sapphire Preferred with one (or both) of these cards is one of the best ways to make the most of your points. In case you aren’t aware, the Ultimate Rewards program allows you to freely transfer points between your cards that participate in the program. As a result, the points on the two Freedom cards that would usually only be redeemable for cash back can be sent to your new Sapphire Preferred card, instantly increasing their value. You’ll get at least 1.25 cents apiece when you book travel directly through the Chase travel portal, but you can expand that even more by transferring to one of the program’s valuable transfer partners.
And this trick isn’t limited to those with personal cards…
If you’re a small business owner with the Ink Cash
You can utilize the same strategy outlined above if you’re a business owner with the Ink Business Cash Credit Card. You may think that you must keep your business and personal cards entirely separate, but while that does hold true for expenses you charge to the card, it doesn’t apply to the earnings on the card. Here’s what you’ll find on the Ultimate Rewards FAQ page under the Combine Points section:
Can I move points I earn to other Chase cards with Ultimate Rewards?
Yes, you can move points, but only to another Chase card with Ultimate Rewards belonging to you, or one member of your household or owner of the company, as applicable.
As a result, you can apply for the Sapphire Preferred as an Ink Cash cardholder and then transfer your current points from your small business account to the Sapphire Preferred to augment their value.
If you don’t currently have a card that earns Ultimate Rewards points
The Ultimate Rewards program can be incredibly lucrative if you know how to redeem your points for maximum value. If you don’t currently have a card that participates in the program, the Sapphire Preferred is a great one to get started. As noted above, the card carries a valuable sign-up bonus, lucrative earning rates and several added perks for a very small annual fee (and one that is waived for the first year). Once you’ve had the card for a few years and become more familiar with making the most of your Ultimate Rewards points, you can do what I did: downgrade the card to the Freedom Unlimited and then apply for the Chase Sapphire Reserve.
However, be sure you understand the restrictions when it comes to the two Sapphire cards, which brings me to the next section of my analysis…
Who shouldn’t get the Sapphire Preferred?
Of course, just as certain travelers should apply for the Chase Sapphire Preferred Card, there are certain types of travelers who shouldn’t go for the card. Here are some of those cases:
If you currently have the Sapphire Reserve
The credit card world was turned upside down when the Chase Sapphire Reserve was introduced in August 2016. With an incredible sign-up bonus (since lowered to 50,000 points after you spend $4,000 on purchases in the first 3 months from account opening), terrific earning rates and a host of valuable benefits, the card was a hot commodity right off the bat. However, if you currently carry the card in your wallet, don’t even consider adding the Sapphire Preferred. There are a couple of key reasons for that:
- Earning rates: The Sapphire Reserve offers 3x points on travel and dining purchases, while the Sapphire Preferred offers 2x points on travel and dining (both offer 1x points everywhere else).
- Added perks: You’ll be able to take advantage of a $300 annual travel credit, Priority Pass membership and up to a $100 application fee credit for Global Entry or TSA PreCheck on the Sapphire Reserve. None of these perks are provided on the Sapphire Preferred.
With these additional benefits, it simply doesn’t make sense to carry both cards in your wallet, and Chase even stopped allowing this very thing for new cardholders as of August 2017.
If you received a sign-up bonus from any Sapphire card in the last 24 months
In addition to preventing current Sapphire Reserve cardholders to sign-up for the Sapphire Preferred (and vice versa), Chase also added new restrictions to earning the sign-up bonuses on these two cards in August 2017. You can’t earn a sign-up bonus on the Sapphire Preferred card if you earned one from any Sapphire card in the prior 24 months. As a result, if you recently took home a bonus on the card, be sure to wait until you’re at least 2 years out before applying for the Sapphire Preferred.
If you’ve applied for 5 or more cards from any issuer in the last 24 months
The final type of individual who shouldn’t apply for the Sapphire Preferred would be those impacted by Chase’s notorious 5/24 rule. If you’re not familiar, Chase will typically immediately deny your application for many of its popular travel rewards credit cards if you’ve opened 5 or more new credit cards in the last 24 months (hence the “5/24” moniker). Note that this even includes accounts on which you’re an authorized user, though I did have success calling Chase’s reconsideration line when I was denied for the United MileagePlus Explorer Card and my fifth recently opened card was my wife’s account. However, if you currently have 5 or more new credit cards on your credit report, don’t waste a hard inquiry by applying for the Sapphire Preferred; you’ll be sorely disappointed.
The Chase Sapphire Preferred Card is a fantastic option for diving deeper into the points and miles hobby, as it provides many opportunities to redeem for valuable rewards that are far beyond those that simpler, fixed-value cards can provide. That being said, it isn’t the best option for everyone, so be sure to consider your own unique situation and whether the card makes sense for your wallet. Hopefully this post has given you some good, concrete suggestions of when you should (or shouldn’t) apply for the card!
For more information on the Sapphire Preferred, check out the following posts:
- Credit Card Review: Chase Sapphire Preferred
- One Year of Earning and Burning with the Chase Sapphire Preferred Card
- Is the Chase Sapphire Preferred Worth the Annual Fee?
- Maximize Everything About the Chase Sapphire Preferred in One Trip
- 5 Reasons Chase Sapphire Preferred Should Be Your First Card
With great travel benefits, 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. Here are the top 5 reasons it should be in your wallet, or read our definitive review for more details.
- 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®
- Chase Sapphire Preferred named "Best Credit Card for Flexible Travel Redemption" - Kiplinger's Personal Finance, June 2018
- 2X points on travel and dining at restaurants worldwide & 1 point per dollar spent on all other purchases.
- 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