For years the Chase Sapphire Preferred® Card was regarded as one of best travel rewards credit cards out there. The card is incredibly well rounded, as it offers double points on dining and travel, great travel protection, and the ability to transfer points to a bunch of valuable airline and hotel partners.
However, over the past couple of years the Chase Sapphire Reserve® has stolen the spotlight, as this $450 annual fee card has become very popular with consumers. The card offers triple points on dining and travel, a $300 annual travel credit, a Priority Pass membership, and more.
Nowadays it sure seems to me like the Sapphire Reserve is more popular than the Sapphire Preferred, though in this post I wanted to look at eight reasons you might want to consider the Sapphire Preferred. I’m not suggesting one is better than the other, but rather am just encouraging some thought on the topic, especially in light of recent changes we’ve seen on other cards.
I also think this is more worth considering than ever before, especially with some of the changes we’ve seen to other cards.
In no particular order, here are eight reasons to consider the Sapphire Preferred over the Sapphire Reserve:
You’re new to Ultimate Rewards
If you’re just getting started in the Ultimate Rewards ecosystem, starting out with the Sapphire Preferred is a great option. The card has a waived annual fee for the first year (while the Sapphire Reserve doesn’t), so this is a way to get started with Ultimate Rewards without having to pay an annual fee upfront.
After a year you should be able to upgrade to the Sapphire Reserve if you decide that’s a better option for you, and your points would fully transfer to the card. So you might as well start with the lower cost option and go from there.
There are several great cards with which you can earn Ultimate Rewards points
You want to add authorized users
You can add authorized users to the Sapphire Preferred at no additional cost, and they’ll also earn double points on dining and travel, and get most of the other privileges you do as well.
However, the cost to add an authorized user on the Sapphire Reserve is $75 each. Now, there are benefits to doing so (including a Priority Pass membership for authorized users), but if the goal is to just add an authorized user for spend purposes, it’ll take quite some annual spend per authorized user in the dining and travel category to make up the $75 per person authorized user fee difference.
You’re worried about getting approved
Why? The Sapphire Preferred is a Visa Signature Card, while the Sapphire Reserve is a Visa Infinite Card. In general, each of those types of cards has a credit line minimum:
- A Visa Signature has a $5,000 minimum credit limit
- A Visa Infinite has a $10,000 minimum credit limit
Sometimes it’s possible to be approved with a lower credit limit (especially when product changing or allocating credit around), but that’s a general rule to be aware of.
What this means is that you can have an excellent credit score, but they could decide that they only feel comfortable giving you a $7,000 credit limit, for example. If that’s the case, you could be approved for the Sapphire Preferred but not the Sapphire Reserve.
You don’t spend that much on dining and travel
Let’s assume the primary reason you want either card is for the return on spend that it offers. Since I consider the Sapphire Reserve to have an “out of pocket” of $150 per year (after factoring in the $300 travel credit), that means you’re paying an additional $55 over the $95 annual fee on the Sapphire Preferred (this math is beyond the first year — the first year the difference is $150, since the Sapphire Preferred has the annual fee waived).
Personally I value Ultimate Rewards points at 1.7 cents each. This means (based solely on spend):
- The first year you’d need to spend ~$8,823 on dining and travel to come out ahead with the Sapphire Reserve over the Sapphire Preferred
- In subsequent years you’d need to spend ~$3,335 on dining and travel to come out ahead with the Sapphire Reserve over the Sapphire Preferred
This includes spend specifically on dining and travel that you’d otherwise put on one of these cards.
Which card makes most sense depends on how much you spend on travel and dining
You also have the Citi Prestige Card
This point somewhat overlaps with the above point, but I think it’s worth calling out specifically.
Just over a week ago huge changes were made to the Citi Prestige Card. The card now offers 5x points on dining and airfare purchases. That card earns Citi ThankYou points, and personally I value Chase Ultimate Rewards points and Citi ThankYou points roughly equally (about 1.7 cents each).
The Citi Prestige changes we’ve just seen
So at this point I’m no longer using the Sapphire Reserve for my dining and airfare purchases. At this point my Sapphire Reserve spend is limited to non-airfare travel purchases.
This greatly impacts how much spend I put on the card, and that impacts the breakeven point between this card and the Reserve and Preferred.
You don’t value the Priority Pass membership
Priority Pass is the world’s largest network of independent lounges, and having a membership is extremely valuable, in my opinion. However, if you’re anything like me, you may very well have several of these memberships. For example, I now have four Priority Pass memberships.
There’s no value to having more than one membership, so for many this feature will be valuable, while for others it will be worthless.
Quito Airport Lounge, which Priority Pass members have access to
You don’t want to redeem points for 1.5 cents each towards travel
|Aer Lingus Aer Club||IHG Rewards Club|
|Air France/KLM Flying Blue||Marriott Rewards|
|British Airways Executive Club||Ritz-Carlton Rewards|
|Iberia Plus||World Of Hyatt|
|Southwest Airlines Rapid Rewards|
|Virgin Atlantic Flying Club|
The area where the points differ is if you prefer to redeem them as cash towards the cost of a travel purchase. If that’s your preference:
- If you have the Sapphire Preferred, points can be redeemed for 1.25 cents each towards a travel purchase
- If you have the Sapphire Reserve, points can be redeemed for 1.5 cents each towards a travel purchase
If you value the ability to redeem points for 1.5 cents each towards the cost of a travel purchase, there’s an advantage to the Reserve. Otherwise the points are equally valuable, in my opinion. Personally I like to redeem Ultimate Rewards points by transferring them to partners, so this isn’t a feature I value all that much.
Points earned on both cards can be transferred to Singapore Airlines KrisFlyer
You don’t want to pay a $450 annual fee
While the Sapphire Reserve has a $450 annual fee, in reality the card should only cost you about $150 per year, after factoring in the $300 travel credit, which I consider to be almost as good as cash.
Nonetheless, psychologically a lot of people have a hard time justifying a $450 annual fee. I can’t count the number of people I’ve told about the card, and I’ve explained “you’ll pay a $450 annual fee, but you’ll get a $300 travel credit that’s basically as good as cash,” and their response was “I don’t want to pay $450 upfront.”
If that applies to you, then maybe the Sapphire Preferred with a $95 annual fee that’s even waived the first year is a better option. You can always later work your way up to the Sapphire Reserve, if you want.
There are pros and cons to both the Sapphire Preferred or Sapphire Reserve, and you can’t go wrong with either card. For many I do think the Sapphire Reserve is the most approachable $450 annual fee card, since it shouldn’t cost you nearly that much in the end, after factoring in the $300 credit.
However, I think there’s also a lot of merit to first getting the Sapphire Preferred, especially given that the annual fee is waived for the first year, and then you can always eventually upgrade to the Sapphire Reserve.
Furthermore, with the recent changes to the Citi Prestige, many people will find themselves putting less spend on the Sapphire Reserve, perhaps making it harder to justify.
Has your perspective on the Sapphire Reserve vs. Sapphire Preferred changed in light of recent changes to the Citi Prestige, etc.?