Why I'm convinced the Chase Sapphire Preferred is one of the best starter cards to earn points and miles

Chase Sapphire Reserve and Preferred

  • While the
    Chase Sapphire Reserve
    ($450 a year) is superior in many ways,
    the
    Chase Sapphire Preferred Card
    ‘s lower annual fee ($95 a year)
    makes it a great entry-level card for people new to booking with
    points and miles.
  • It earns flexible points that are inherently more
    valuable than points or miles earned by similarly priced co-branded
    credit cards.
  • Because Chase allows account holders to pool points,
    the
    Chase Sapphire Preferred
     pairs well with other cards that earn
    Chase Ultimate Rewards.
  • The
    Sapphire Preferred
    offers a sign-up bonus of 60,000 Chase
    points after you spend $4,000 in the first three months. That’s
    worth at least $750 toward travel.

It may seem odd to attach the title of “best” to a card that is
outperformed in virtually every meaningful way by product in the
same family. But here I am, telling you that the
Chase Sapphire Preferred
 credit card is the best travel credit
card for people new to points and miles.

Yes, its 2x points on travel and restaurant spend is dwarfed by
the $450-a-year
Chase Sapphire Reserve
‘s 3x. Yes, its 1.25 cents per point of
uplift when booking travel through Chase’s Ultimate Rewards portal,
now powered by Expedia, can’t match the Reserve’s powerful 1.5
cents per point of uplift.

But the
Chase Sapphire Preferred
has one major thing going for it: It’s
cheap. At $95 a year, the
Sapphire Preferred
is a premium card packed with tons of
potential at an entry-level price. Plus, it’s actually offering a
higher sign-up bonus than the
Reserve
. With the Sapphire Preferred, you can earn 60,000 Chase
points after you spend $4,000 in the first three months. With the
Reserve, the sign-up offer has the same minimum spending
requirement in the first three months, but you’ll earn 50,000
points instead of 60,000.

That small fee grants access to a bevy of impressive perks for
such an inexpensive card which includes, but is certainly not
limited to, primary rental car collision coverage, trip
cancellation insurance, and trip delay reimbursement.

Additionally, the card earns Ultimate Rewards points, which are
one of the top currencies in the points and miles world. Their
value, like most other bank points, are enhanced because of their
flexibility — you can transfer the Ultimate Rewards points in
your
Chase Sapphire Preferred
account to a number of travel partner
loyalty programs. Or, as mentioned earlier, you can use those
points to book travel reservations through Chase’s native booking
portal. When doing so, your points are worth 1.25 cents per point,
which provides a hefty discount compared to booking directly with
cash.

The Sapphire Preferred provides flexible points, which can be
hugely valuable

If you’re new to booking travel reservations with points and
miles, you should know that flexible currencies like Chase Ultimate
Rewards points are great because they are so fungible. Many
newcomers to the points and miles world start their journey by
identifying an airline or hotel program they frequently use, then
applying for that specific airline or hotel’s co-branded credit
card, thinking those cards would provide significant value. They’re
not wrong, necessarily, but points earned through co-branded cards
are generally less valuable than flexible points (although, as with
most things to do with credit rewards, that measure is somewhat
subjective).

Flexible points are more valuable because once you earn points
and they are deposited into a specific program, like Southwest
Rapid Rewards, for example, they typically can not be moved or
redeemed elsewhere. There are, of course, a few exceptions to this.
However, bank points, like those earned with the
Chase Sapphire Preferred
, offer much more flexibility, which
makes them more valuable by nature.

For example, let’s say I earn 60,000 Southwest Rapid Rewards
points by signing up and using their credit card. I may find some
great deals, redeeming those points for fares that would have
otherwise costs quite a bit in cash. But, if I’m determined to only
keep a few credit cards in my portfolio, those points can come at
moderately high opportunity cost.

To contrast, let’s say I earn a similarly robust 60,000 points
using the
Chase Sapphire Preferred
. If I need to fly on a route serviced
by Southwest that costs, say, 15,000 Rapid Rewards points, I can
transfer my points from Chase directly to Southwest to cover the
cost. Now, I have 45,000 points left over to use as I wish. I could
use my remaining points for different airline or hotel program
transfers or bookings, depending on where my travels take me.

This is how I typically use my points, transferring between
various travel partners as the need arises.

The Sapphire Preferred is easy to combine with other Chase cards

Another reason I like the
Sapphire Preferred
 is because it plays along nicely with other
Chase Ultimate Rewards point-earning cards. In addition to the

Sapphire Preferred
, I also have the
Chase Freedom
card, which offers 5% cash back (5x points) on
quarterly rotated categories, up to $1,500 each quarter you
activate, as well as the
Chase Freedom Unlimited
, which earns me 1.5% cash back (1.5x
points) on all purchases. Chase allows cardholders to combine
points from their accounts. So, when my points post to each of my
accounts each month, I transfer them to my
Sapphire Preferred
 account.

I’ll use my
Sapphire Preferred
for dining and travel purchases, my
Freedom
card for those specific, rotating categories, and my

Freedom Unlimited
for everything else. This ensure that, at
minimum, I’ll always be earning 1.5x points on every purchase,
sometimes more, and those points will be put to good use when they
are finally moved to my
Sapphire Preferred
account.

One day, I’ll probably end up getting the Reserve

I will likely
upgrade to the Reserve
 at some point in the future. Because
Chase currently requires four years to pass before a cardholder is
eligible for another Sapphire product sign-on bonus, I will simply
upgrade to the
Reserve
instead of fully closing my
Sapphire Preferred
 account.

Because of my travel habits, the
Reserve
would have likely given me more value than the
Sapphire Preferred
. But I didn’t know at the time. I didn’t
know if I would figure out how to easily navigate points transfers
and other loyalty intricacies. I didn’t know if I would travel
enough to take full advantage of all of the
Reserve
perks. I know now that I have a decent handle on the
broad strokes of the points and miles world.

I also know that because I opted to start with
Sapphire Preferred
, it was an inexpensive education. I’ll get
the
Chase Sapphire Preferred
‘s premium sibling soon, cardholders
have to wait at least 12 months to upgrade, but for now, I’ll enjoy
and continue to get great value out of my
Preferred card
.

Learn
more about the Chase Sapphire Preferred from our partner The Points
Guy »


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Source: FS – All-Travel destinations-News
Why I'm convinced the Chase Sapphire Preferred is one of the best starter cards to earn points and miles