The Critical Points: A Wells Fargo Card Duo Is Better Than the Chase Sapphire Reserve

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Each month in his column "The Critical Points," TPG Senior Points and Miles Contributor Richard Kerr presents his opinion on a loyalty program, card product or recent news that he believes is overlooked, unsung or the result of groupthink taking mass opinion in a direction with which he doesn't agree. His goal is not necessarily to convince you to agree with his position, but rather to induce critical thought for each of the topics and positions he covers.

Just to be clear before we get started today, what follows is my own opinion and analysis. The Points Guy didn't ask me to write about this topic — I chose it myself, as I choose all my "Critical Points" column topics. So while today's subject is sure to cause a lot of reaction, hear me out. Hopefully I'll provoke some hard thinking about the status quo that'll result in you evaluating your own card strategy.

Here it is: I would prefer to have both the Wells Fargo Propel American Express® card and the Wells Fargo Visa Signature® Card in my wallet instead of a Chase Sapphire Reserve. The two Wells Fargo cards can yield a higher redemption value toward paid flights, carries Visa Signature benefits, offers more 3x bonus spend categories than the Reserve and does it all for no annual fees. (Note that the information related to the Wells Fargo Visa Signature Card has been collected by The Points Guy and has not been reviewed or provided by the issuer or provider of this product or service.)

Am I crazy? No. Let's take a look at how the math adds up and why two Wells Fargo cards are better than one CSR.

The Wells Fargo Card Duo

First, here are the basics of the two Wells Fargo cards and how you can use both to unlock potential value.

Wells Fargo Visa Signature Card — Welcome bonus of 5x points at gas stations, grocery stores and drug stores for the first six months up $12,500 in spending. That equates to 62,500 points if you're able to spend the entire amount. You earn 1x points on all spend after that and no annual fee. Go Far Rewards earned with this card are worth 1.5 cents each towards paid airfare. If you spend $50,000 on the card in a year, the redemption value increases to 1.75 cents each toward flights.

Wells Fargo Propel American Express® card — This card earns the same Go Far Rewards as the Visa Signature card and you'll earn 30,000 bonus points when you spend $3,000 in purchases in the first 3 months. On an ongoing basis, the Propel Amex earns 3x points on travel — which includes flights, hotels, homestays, car rentals, taxis and rideshares — along with dining (referred to by Wells Fargo as “eating out and ordering in”), gas stations and popular streaming services. The new card also earns 1 point per dollar on all other purchases. Points redeemed with the Propel Amex are worth 1 cent each toward cash back, gift cards, donations to charity and travel, including airfare.

The key point to remember here is that you can transfer Go Far Rewards between any account of any cardholder with no fee. That means points earned with the Propel Amex can be combined with your Visa Signature to make all your points worth 1.5-1.75 cents each toward airfare.

Higher Potential Value and Sign Up Bonus

Now let's compare those numbers to the Chase Sapphire Reserve. Ultimate Rewards earned with the CSR are worth 1.5 cents each toward paid travel when redeemed through the Chase travel portal. If you have the ability to spend $50,000 with the Wells Fargo Visa Signature, your Go Far Rewards will increase to 1.75 cents each. That's 16.7% more than the Sapphire Reserve.

The current Sapphire Reserve sign-up bonus of 50,000 points is worth $750 when redeemed through the Chase portal (potentially more when the points are transferred, but we'll get to that in a moment). On the other hand, if you maximize the $12,500 in 5x spend for the Visa Signature card, it's worth between $937.50 and $1,093.75 depending on whether you spend $50,000 on the card or not. Add in the Propel Amex's 30,000 point welcome bonus and that's another $450-$525, for a total potential value of $1,618.75 from the sign up bonuses compared to $750.

(An important part of this to remember is that you can only receive one Wells Fargo bonus every 15 months, so you'll either want to wait that long between cards, or apply for one card and have your spouse or someone in your family that you implicitly trust get the other in order to get both bonuses. You can then combine all your family's points for free.)

The real value when redeeming Go Far Rewards toward flights is twofold for me. First, I don't have to worry about award availability when I redeem through the Go Far Rewards portal — I pick any flight I want and get a free flight. Second, the flights that cost me $0 out of pocket will earn elite qualifying and redeemable miles, making the points even more valuable. This is the same as when redeeming CSR points for flights, but Go Far Rewards are better in this circumstance because they take the stress out of deciding whether to transfer or not, as I don't feel like I missed out on outsized potential value when I redeemed them for paid travel.

No Annual Fees

Both Wells Fargo cards surprisingly carry no annual fee, which is a ton of value for not being asked to pay anything upfront. On the other hand, the Sapphire Reserve carries a $450 annual fee with a $300 travel credit. Yes, that means the annual fee is effectively $150, but you must pay $450 up front, and while most cardholders will surely spend $300 on travel in a year, if something happens and you can't, that money is already obligated.

Because you don't have the freedom to spend the $450 as you wish, it's not like cash in your pocket. I've also had cardmembers tell me stories of merchants who changed payment processors after coding as travel for previous CSR uses, resulting in these folks scrambling in the last months of their cardmember year because that merchant they were counting on no longer counts toward the $300 credit. So while the CSR's annual fee can certainly be offset with the travel credit, it starts as $450 compared to $0 for the Wells Fargo cards.

More 3x Bonuses

The Wells Fargo Propel American Express® card will earn 3x points on all the same purchases that the CSR would, plus it includes both websites that rent vacation properties (think AirBnb) and gas purchases. The amount many people spend on gas alone should sway you to use a Propel Amex and can add in significant value compared to a CSR. You'll also earn 3x points on select streaming services with the Wells Fargo Propel American Express® card, compared to 1x with the CSR.

Cell Phone Insurance and Visa Signature Benefits

The Propel Amex carries free cell phone insurance, which is initiated by simply paying your cell phone bill every month with the card. Now, to be fair, there are a number of restrictions with that coverage — for instance, it only covers damaged or stolen phones, not lost ones. But I'm willing to earn 1.5% cash back toward plane flights on my cell phone bill knowing I'll only have to pay a $25 deductible and receive up to $600 in phone repair or replacement costs in case something happens to my family's expensive iPhones.

The Wells Fargo Visa Signature carries benefits like lost/damaged baggage insurance, secondary car rental insurance, return protection, extended warranty and travel accident insurance. All of the benefits are not as good as the CSR, but many of the same CSR benefits can be had with the $95 annual fee Chase Sapphire Preferred Card.

Ultimate Rewards Are Worth More

I'm not portraying Ultimate Rewards as less valuable than Go Far Rewards — there are many good reasons that TPG values Ultimate Rewards points at 2.1 cents apiece. I'm arguing it's better to earn Ultimate Rewards with a Chase Sapphire Preferred or Ink Business Preferred Credit Card for a $95 annual fee. These cards give you the ability to transfer Ultimate Rewards for a much lower annual fee, and carry the same or higher sign-up bonus than the Chase Sapphire Reserve.

Having both Wells Fargo cards plus an Ink Preferred and a Chase Freedom (No longer open to new applicants) or Chase Freedom Unlimited would be the most potent combination of cards to carry in your wallet.

Boycott Wells Fargo?

In addition to the card comparison, we need to address the widespread sentiment of boycotting Wells Fargo. In September 2016, news broke that Wells Fargo employees opened what eventually turned out to be roughly 3.5 million fake accounts using unauthorized customer information. More recently, the issuer announced that a computer glitch caused 625 customers in the foreclosure process to lose their home after they were incorrectly denied a loan modification, and the bank has had other regulatory issues that ended in fines or settlements.

This is, without a doubt, horrible behavior by a huge company that has the power to control your life. However, many of the nation's major banks also engaged in bad behavior — much of which contributed to the 2008-09 financial crisis — and many of them were also fined billions of dollars (two months ago, Chase was fined $65 million for trying to manipulate the benchmark rate, on top of agreeing to a $13 billion settlement for overstating the quality of mortgages in the run up to 2008-09 financial crisis).

To single out Wells Fargo for a boycott but embrace Chase is illogical. All banks have their faults and all have the ability to provide significant travel rewards. While I hope every bank has put this kind of behavior behind them, history tells us we'll likely see some bank somewhere down the line engage in questionable behavior again. It isn't logical to ignore the unethical and criminal behavior of all banks and boycott Wells Fargo alone.

Bottom Line

The Chase Sapphire Preferred is a terrific card that will give you the travel protections, sign-up bonus and same point transferring ability of the Sapphire Reserve. Wells Fargo Propel American Express® card and Visa Signature cards give you more earning power toward paid flights than the CSR, in addition to valuable cell phone insurance and a higher combined welcome bonus. This makes a CSR and its $450 annual fee an unnecessary luxury. I've never held a CSR, and with both Wells Fargo cards now in my possession, I don't have any plans to add one to my wallet anytime soon.