How to get more than $3,000 in value from the Chase Sapphire Preferred in the first year
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Editor’s note: This post has been updated with new information.
The Chase Sapphire Preferred Card is currently offering 60,000 points after spending $4,000 on purchases in the first three months of account opening. That bonus alone, worth $1,200 according to TPG valuations, might be enticing enough to get you to apply without reading further down the benefits list.
But when considering any travel rewards credit card, it’s important to look ahead and make sure that you will get enough value that keeping it will be worthwhile. Fortunately, it’s not hard to maximize the Chase Sapphire Preferred’s many, many benefits in order to offset the $95 annual fee.
Here’s how you can get more than $3,000 in value from the Chase Sapphire Preferred in the first year, thanks to a ton of benefits and ongoing perks.
Sign-up bonus: $1,200
At 60,000 points, the sign-up bonus is a sizable haul of points.
Each Ultimate Rewards point earned with the Chase Sapphire Preferred is worth 1.25 cents toward travel booked through the Chase portal. That puts the sign-up bonus at a value of $750 if points are redeemed in that manner.
However, we currently peg Ultimate Rewards points at 2 cents apiece because of how versatile and valuable they are when used for travel with Chase’s 11 airline and three hotel partners — including United, British Airways, Air France-KLM and Hyatt — for even more high-value rewards. In those terms, a sign-up bonus of 60,000 points is worth closer to $1,200.
Think that’s too high a valuation for credit card points? Consider this: You could transfer 50,000 Ultimate Rewards points to Virgin Atlantic Flying Club. From there, you’d be able to redeem them for a one-way ticket in Delta One from the U.S. to Europe (excluding the U.K.). Meanwhile, the cash fares range from $1,100-$2,400 for these flights — exceeding TPG’s value of 2 cents apiece. But that’s just one option — the sky’s the limit.
Annual prepaid hotel credit: $50
When booking a prepaid hotel stay through the Chase Ultimate Rewards portal, you can receive up to $50 in statement credits per year. This annual perk alone can cover more than half of the $95 annual fee, and it’s relatively straightforward to use this credit. The only caveat is that you may want to avoid booking chain hotels if you have (or are trying to earn) elite status, since reservations that aren’t booked directly with the hotel will likely not count toward elite nights or garner any of your elite benefits, like room upgrades. Note: The first $50 in Ultimate Rewards hotel purchases will not earn rewards points.
DoorDash DashPass: $400
Chase Sapphire Preferred cardholders can get a minimum of one complimentary year of DoorDash DashPass when they activate by March 31, 2022. DashPass normally costs $9.99 per month and includes $0 delivery fees and reduced service fees on eligible orders of over $12 on DoorDash and Caviar.
If you get the Chase Sapphire Preferred now and register for this offer, you’ll receive at least 12 months of the service complimentary — around $120 in value. DoorDash estimates DashPass saves users around $4-$5 per order. If you order DoorDash once per week as I do, that’s around $250 in value per year. Altogether, you’re looking at nearly $400 in value from this one perk.
Lyft bonus points: $15
Chase also has a partnership with ride-hailing service Lyft that includes enhanced earning on rides for those with the Chase Sapphire Preferred. Instead of the usual 2 points per dollar on travel that Lyft rides would normally earn, you’ll accrue 5 points per dollar through March 2022 — over double the normal rate. Every 5 points per dollar you earn is like getting 10% back, based on our current valuations.
Let’s say you spend about $50 per month on Lyft rides. That’s about $250 in rides from now through the end of the promotional period. Calculate your extra earnings, and that’s around $15 more back on your spending than the normal rate of 2 points per dollar.
Related: Best credit cards for Lyft and Uber
Travel protections: $1,000
For a credit card whose annual fee is just $95, the Chase Sapphire Preferred offers one of the best suites of travel protections out there.
- Trip cancellation and interruption insurance covers up to $10,000 per person and up to $20,000 per trip.
- Trip delay reimbursement kicks in at 12 hours and covers up to $500 in incidentals, such as meals and lodging.
- Baggage delay coverage allows you to claim up to $100 per day for up to five days for replacement items like clothing and toiletries. It will cover lost or stolen luggage up to $3,000 per passenger, too.
- Primary collision and damage insurance on car rentals, which can be a lifesaver when you get into a fender bender. This is one of the few cards that still offer this benefit (most offer secondary coverage).
While things hopefully don’t go too wrong on the road for you usually, there are bound to be a few bumps along the way as travel rebounds post-pandemic. Chances are, there will be some missed flight connections and mishandled bags as airlines ramp up service. Or perhaps there may even be a ding or dent as more folks who have been stuck at home try to rehabilitate their parallel parking skills (in an unfamiliar rental car) on the road trips everyone seems to be taking.
For that reason, we’re going to value these benefits at around $1,000 for the first year. Your value may come in higher or lower than that mark, but even if it saves your plans just once, it can easily be worth that much.
Purchase protection: $100
Like many other cards, the Chase Sapphire Preferred offers purchase protection that can save you money and headaches even when you aren’t traveling. It covers items up to 120 days after purchase against theft or damage when you pay with the card. These claims are capped at $500 each and $50,000 per account.
While you’re probably not going to be a frequent user of this benefit, it’s not outrageous to think that something you purchase will get damaged. That said, you shouldn’t be using this card for large purchases, given its low per-claim maximum. We’ll lowball the value of this perk at around $100 a year, in case you need to call upon it for one or two small things.
Visa Signature hotel benefits: $330
Even frequent travelers sometimes forget that the Chase Sapphire Preferred is a Visa Signature card (hence all those travel and purchase protections). One of the most overlooked perks of that designation is that it allows cardholders to book stays through the Visa Signature Luxury Hotel Collection.
Doing so confers elite-like benefits at over 900 hotels worldwide, some of which participate in the major points programs, like Marriott Bonvoy, but many do not. Focus on the latter since you wouldn’t want to miss out on earning hotel points and elite night credits by booking through a non-direct channel like this.
The benefits of booking with the Visa Signature Luxury Hotel Collection are:
- Automatic room upgrades upon arrival, subject to availability.
- Complimentary in-room Wi-Fi, when available.
- Complimentary breakfast for two.
- A $25 food or beverage credit.
- VIP guest status.
- Late checkout upon request, when available.
Let’s say you book two, two-night stays per year via the Visa Signature Luxury Hotel Collection and focus on a few of those perks (room upgrades are subject to availability, and their value can vary wildly depending on the property and your dates). And let’s also say you get lucky and get a one-category upgrade on both stays, valued at $20 per room per night. That’s $80 value in the first year right there. Add in $50 for those food and beverage credits, and then let’s also peg breakfast at $50 per day (easy at a hotel restaurant!), for a total of $250 in value for two, two-night stays.
All told, you’re looking at $330 in value.
Before you apply for the Chase Sapphire Preferred, it’s important to keep in mind the card’s other benefits and see which of those may also be worth considering in your situation.
Even without utilizing every single element offered here, getting several thousand dollars in value from this one card should be pretty easy in the first year. From the card’s travel and purchase protections to the Visa Signature hotel benefits and the points you earn on everyday spending, the value adds up even once you get past the 60,000-point welcome bonus.
Official application: Chase Sapphire Preferred.
Additional reporting by Stella Shon.
Featured photo by John Gribben for The Points Guy.
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