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 $550 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.
Reasons To Get The Chase Sapphire Preferred
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 nine reasons you might want to consider the Sapphire Preferred. This is especially true in light of the card’s welcome bonus having been upped earlier this year, as the cards no longer have the same bonuses.
To be clear, I’m not suggesting the Sapphire Preferred is better than the Sapphire Reserve for everyone. But I do think it’s better for some, and I also think that for some people it could make sense to get the Sapphire Preferred and then eventually upgrade to the Sapphire Reserve.
In no particular order, here are nine reasons to consider the Sapphire Preferred over the Sapphire Reserve:
1. You Want A Better Bonus
Previously the two cards had similar welcome bonuses, while one is now better than the other. The Sapphire Reserve offers a welcome bonus of 50,000 Ultimate Rewards points after spending $4,000 within three months, while the Sapphire Preferred offers a welcome bonus of 60,000 Ultimate Rewards points after spending $4,000 within three months.
You might as well pick up the Sapphire Preferred for the better bonus, especially since you can eventually product change it to the Sapphire Reserve (as I’ll discuss below).
2. 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 much lower annual fee, so this is a way to get involved with Ultimate Rewards without having to pay a large annual fee.
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 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 spending purposes, it’ll take quite some annual spending per authorized user in the dining and travel categories to make up the $75 per person authorized user fee difference.
4. 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 Chase 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.
5. You Don’t Spend Much On Dining & Travel
Let’s assume the primary reason you want either card is for the return on spending 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.
Personally, I value Ultimate Rewards points at 1.7 cents each. This means (based solely on spending) 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 spending 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
6. You Also Have The Citi Prestige
This point somewhat overlaps with the above, but I think it’s worth calling out specifically.
At the beginning of the year, 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).
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 spending I put on the card, and that impacts the breakeven point between this card and the Reserve and Preferred.
While I’ll continue putting my dining spending on the Citi Prestige, I’ll be putting my airfare purchases on the Amex Platinum, given that Citi has eliminated a lot of their travel and baggage protection (meanwhile Amex will be introducing this protection soon, and the card also offers 5x points on airfare purchased directly with airlines).
7. You Don’t Value Priority Pass
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 five Priority Pass memberships.
There’s little 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
8. 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 Bonvoy|
|British Airways Executive Club||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:
- With the Sapphire Preferred, points can be redeemed for 1.25 cents each towards a travel purchase
- With 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
9. You Don’t Want To Pay A $550 Annual Fee
While the Sapphire Reserve has a $550 annual fee, in reality, the card should only cost you about $250 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 $550 annual fee. I can’t count the number of people I’ve told about the card, and I’ve explained “you’ll pay a $550 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 $550 upfront.”
If that applies to you, then maybe the Sapphire Preferred with a $95 annual fee is a better option.
Tip: Get The Sapphire Preferred & Then Upgrade
I think one of the all around best strategies here is to apply for the Sapphire Preferred. This has the benefit of:
- Being easier to get approved for
- Offering a better welcome bonus
- Being a great intro to Ultimate Rewards
- Having a significantly lower annual fee
Then once you’ve had the card for 12 months you should generally be able to upgrade it to the Sapphire Reserve, unlocking all the benefits offered by that card. Your points would all transfer over, and you could even redeem them at the rate of 1.5 cents each towards a travel purchase.
Given the richer welcome bonus and other benefits of starting with the Preferred, I do think that’s a great strategy for many consumers.
Long term there are pros and cons to both the Sapphire Preferred and Sapphire Reserve, and you can’t go wrong with either card. For many, I do think the Sapphire Reserve is the most approachable $550 annual fee card, since it shouldn’t cost you nearly that much in the end, after factoring in the $300 travel credit.
However, I think there’s also a lot of merit to first getting the Sapphire Preferred, and then you can always eventually upgrade to the Sapphire Reserve.
Where do you stand — do you prefer the Sapphire Preferred or Sapphire Reserve?