Traveling is expensive, and figuring out how to afford it can be a major challenge — especially if you’re on a tight budget.
That’s why I’m such a big fan of credit card reward travel, which has allowed me to have amazing experiences that I otherwise wouldn’t have been able to afford.
The Chase Sapphire Reserve and Chase Sapphire Preferred are two great options when it comes to travel rewards credit cards. This review will give you more information about each of them so that you’ll be able to make an informed decision as to which one is right for you.
What is Rewards Travel?
Rewards travel, which is also sometimes called travel hacking, is the art of earning credit card rewards points (or miles) and exchanging them for free or steeply-discounted travel. Points can be redeemed for airline tickets (or ticket class upgrades), car rentals, hotel bookings, and sometimes even things like theme park tickets.
Banks offer points to encourage people to make purchases using their credit cards, with the hope that cardholders will carry a balance (which comes with a high interest rate — sometimes as high as 30% annually, depending on your credit score). However, there’s absolutely no rule that says you need to carry a balance to earn points. You’ll still reap these rewards even if you pay off your credit card in full every month.
Additionally, many banks try to attract new customers to their credit cards by offering extremely lucrative sign-up bonuses. These promotions are often worth hundreds of dollars in free travel.
If you use your card for routine purchases and recurring expenses, you can easily earn thousands of rewards points every month. If done right, most people can earn at least one or two free trips per year.
In order to do that, you have to keep in mind a few key rules about travel hacking that make this method worthwhile. The most important of these rules (by far) is to avoid debt.
As I noted earlier, banks offer points because they hope you’ll carry a revolving balance on your card — which means you’ll be paying interest. Doing so will negate the value of any rewards you receive, and will almost certainly leave you in the negative in the long run (especially if you’re only paying the minimum amount due each month).
But if done correctly — which means paying off your full balance every month and understanding how many points you receive for each purchase — you can save money and get to see the world at the same time.
TW2W’s Reward Credit Card Comparison Philosophy
If you’re looking for an article that will tell you which card is the best overall, let me explain why I’m not going to do that here. What’s “best” depends on each individual and his or her circumstances. The best travel card for your neighbor may not be the best travel card for you.
That’s why “top credit cards” posts should always strive to explain which card is best for which circumstances — because there’s no clear-cut winner for every person. And what’s best for you at one stage of your life may not be the best fit as your own personal circumstances change.
Given that, what criteria should you use when considering whether the Chase Sapphire Reserve or the Chase Sapphire Preferred is right for you? Here are a few things to consider.
- Your travel goals: Do you want to rack up points for future use, or do you already have a trip planned? I recommend having a trip in mind (here’s a post to show you how to plan). That can help you determine which card to select. If you know where you want to go, you can pick a card that gives flight awards to that destination. So get your dream family vacation ideas on paper and see if you can make them happen.
- Your spending: Knowing your spending habits and matching them up with a specific card is important. Many cards offer extra points within specific categories. If you eat out a lot, you should look for a card that gives you at least double the points for purchases at restaurants. Likewise, if you’re already a frequent traveler, look for a credit card that offers extra points for travel purchases.
- Long-term credit: In order to build the best credit score possible, you should keep your credit cards for the long-term. Part of your credit score is based on the age of your accounts, with older accounts providing a bigger boost. So avoid the temptation to sign up for a card just for the short-term benefits; doing so can hurt you more than help you.
- Flexibility: Before signing up for a credit card, make sure it’s not too restrictive when it comes to exchanging your points for rewards. For example, some cards limit the airlines you can fly on, while others offer a wide array of choices. Also, it’s important to know whether or not unused points expire after a certain period of time, or whether you can save them up indefinitely.
Keeping those considerations in mind will help you make a better choice. But before you fill out that online application, ask yourself these questions:
- Will this card help me achieve my travel goals? It’s important to think about where you want to go (and how you want to get there). Knowing that will help you select the right card to achieve your goal in the least possible amount of time. The Beginner’s Guide to Travel Hacking Hawaii will show you why it’s OK to dream big with your rewards travel plans.
- Will I keep this card for the long-term? A good rule to follow is to never do anything that will hurt your credit score. That means you should only apply for cards you want to keep (because closing credit accounts can have a negative impact).
- Can I hit the minimum spending requirement necessary for earning the sign-up bonus without causing myself financial harm? Bonuses are the fastest way to earn points. However, you almost always have to spend a certain amount within a certain period of time in order to actually earn them. Before applying, you need to determine whether or not you can realistically hit the bonus threshold without spending outside of your budget.
With all of that said, here’s a breakdown of both credit credits.
Side Note: If you’re brand new to travel rewards, get our free course:
Why These Particular Cards?
When searching for a travel rewards credit card, you’re going to have no shortage of contenders. And it’s going to get confusing. Each one will be slightly (or radically) different, making your decision that much more complicated.
So, out of the dozens of travel rewards cards on the market, why should you consider these two?
It really comes down to the flexibility of the Chase Ultimate Rewards (CUR) program.
With CUR, you can redeem points for travel in two ways:
- By transferring points to one of Chase’s many travel partners: Recently, I transferred points from my Chase account to United Airlines to book four round trip flights from Chicago to Hawaii. If I had paid for the tickets in cash, it would have cost around $900 per person (or $3,600 total). Instead, I booked the trip for 44,500 points per round trip ticket (or 180,000 total points).
- By exchanging points through the Chase travel portal: If you’re familiar with Expedia, this option is similar. You can search for flights, hotels or even cruises, and then exchange your points for those rewards. Both the Preferred and Reserve cards make your points worth more when you book travel this way (see the table below for more details).
As part of Chase Ultimate Rewards, both cards allow you to earn points in a variety of ways. Chase has several cards that participate in CUR, including business and personal cards. They even have cash-back cards like Chase Freedom, which lets you earn five times the points in certain categories that change every three months.
The key with Chase, however, is to remember that if you want to utilize the ability to transfer points to travel partners, there are only certain cards that allow you to do so. These are considered premium cards and all come with an annual fee. The Chase Sapphire Reserve and Sapphire Preferred are two personal cards that allow you transfer to travel partners.
The beauty about the Chase setup is that you can transfer points between personal and business accounts. You can also transfer points to one other household member, like your spouse.
For example, you can take advantage of Chase’s 5% bonus categories using the Chase Freedom card, then transfer them to your Chase Sapphire Reserve account, where they have more value as you can transfer to a travel partner. Or, you can exchange them for travel through the Chase portal where they’re worth 50% more.
Not all credit cards are as flexible and valuable as CUR cards. For example, American Express Membership Rewards offers a great number of transfer partners, but their travel portal doesn’t carry the value that Chase’s does. Plus, you can’t transfer points to your spouse.
If you’re looking for a cash-back card to complement your travel credit card, consider Chase Freedom or the Chase Freedom Unlimited.
Quick Comparison of Chase Sapphire Reserve vs Preferred
|Card||Sapphire Reserve||Sapphire Preferred|
|Rewards||Get three points per dollar spent on travel and at restaurants, and one point per dollar on everything else. You can transfer to select airline and hotel partners, or get a 50% bonus when redeeming through the Chase Ultimate Rewards portal.||Get two points per dollar spent on travel and at restaurants, and one point per dollar on everything else. You can transfer to airline and hotel partners, or get a 25% bonus when redeeming through the Chase Ultimate Rewards portal.|
|Sign-up bonus||50,000 points after spending $4,000 in the first three months after opening an account.||60,000 points after spending $4,000 in the first three months after opening an account.|
|Travel credit||$300 per year||$0 per year|
|Authorized user fee||$75 per user||$0|
|Lounge access||Priority pass||None|
|Point expiration||Points never expire, but you’ll lose any unused points if you close your account.||Points never expire, but you’ll lose any unused points if you close your account.|
|Caps on earning||No limits on how many points you can earn per month or year.||No limits on how many points you can earn per month or year.|
As you can see, both cards are top-notch in terms of the bonus they offer. And both have a realistic minimum spending requirement of $4,000 within three months, which can work for many households that use the card for their rent, gas and/or food purchases.
If that minimum spending requirement doesn’t align with your budget, then you might want to consider waiting for a period of higher spending to apply for the card. If you wait until the summer, you can charge your kids’ back-to-school items and wardrobe; if you wait until the fall, you can charge your Christmas expenses. Most of us routinely spend more than usual at certain times of the year, so think about your upcoming expenses and plan accordingly.
The Chase Sapphire Reserve and Sapphire Preferred are similar when it comes to their sign-up bonus. But these two cards are quite different in terms of benefits, and specifically with regard to the benefits for frequent travelers.
When Reserve Makes Sense
If you’re a frequent traveler (rather than someone who takes one or two trips per year), this card may make sense for you. Let’s look at why:
- The elephant in the room is the hefty $450 annual fee. But it’s not as bad as it sounds, because you’ll receive an annual travel credit of $300 per year. Since you’d be paying a $95 annual fee for the Sapphire Preferred, you’re essentially paying just $55 more per year for the Reserve card, which comes with more benefits.
- You’ll get three times the points for travel and dining in restaurants, compared to two times the points with the Preferred. If you travel and eat out a lot, that can be a substantial difference.
- Any points redeemed through CUR are worth 50% more, compared to 25% more with the Preferred. So, if you have $500 in travel rewards available, redeeming them through CUR means you’ll end up with $750 in value.
- An important question is whether you have the $450 to pay off the annual fee up-front, because it will be charged as soon as you open the account. That can be hard to swallow in that first year, before you’ve seen any benefits roll in.
Sapphire Preferred Can Also Make Sense
- This one gets you a bigger sign-up bonus — by 10,000 points. That can come in handy if you have an upcoming trip.
- If your spending isn’t super high and you only travel a couple times per year, this might be a better fit.
- With a lower annual fee, this could be a better choice for long-term usage.
If you’re still not sure which card to choose, here are more reasons you might want to consider each card.
Chase Sapphire Reserve Features
Why Apply for the Chase Sapphire Reserve?
50,000 Bonus Points
This is a great bonus offer — it’s one of the most valuable out there right now.
The $300 Annual Travel Credit
You’ll get this as an instant credit for any travel purchases you charge. The first travel expense I charged on the card this year was for airport parking, and I got that fee instantly credited to my account.
As I mentioned earlier, this really whittles down the annual fee (reducing it to $150). Considering you’d pay $95 per year for the Preferred card, it’s only a difference of $55.
Higher Travel and Dining Rewards
Earn 3X points on both travel and dining purchases, instead of 2X.
If you’re thinking about getting this card, you need to spend at least $2,750 on travel and dining per year to break even.
Points are Worth 1.5X When Redeemed for Travel
The biggest advantage comes when you book through the Chase travel portal. Your points can be used for flights and hotels, and both are sometimes heavily-discounted during off-peak times.
For domestic flights, going through the Chase travel portal can be cheaper because of the 50% bonus. You might not find as much value in transferring the points.
In terms of raw value, you can often get a $500 flight for 33,333 points.
Sometimes, Chase gives a discount that makes booking hotels through the portal a good idea. And they aren’t always for off-peak times. Recently, I was looking at redemption prices and one hotel we had our eyes on for a summer trip was on sale for 40% off its regular price. We booked six nights, which would usually cost $350 per night. But with the 40% discount and our 50% redemption bonus for using the portal, we scored six nights for 90,923 points.
Part of what makes CUR so great is its flexibility. If you’re only earning one point per dollar on all your non-travel and non-restaurant purchases, you can still combine other Chase accounts. That means that if you also have the Chase Freedom Unlimited, which earns you 1.5% on everything you purchase, you can transfer those points to the Chase Sapphire Reserve. If you do, you’ll essentially get 2.25% back on everything you spend because of the 50% bonus when you redeem through CUR.
Let’s break that down for clarity:
- Make a $1,000 purchase using your Chase Freedom Unlimited card and you’ll earn 1,500 points.
- Transfer those 1,500 points from your Chase Freedom account to your Chase Sapphire Reserve account.
- All Chase Sapphire Reserve points get a 50% bonus when you redeem them through the Chase travel portal, so you now effectively have 2,250 points.
You’ll Actually Use the Priority Pass Select Membership
Sometimes credit cards offer travel perks that sound nice on paper but aren’t that useful in practice. But Priority Pass, which is offered through the Chase Reserve, is a large network of airport lounges and private restaurants.
Lounges give you a break from overcrowded areas in airports. Access to a good lounge can pay for itself; they often offer good meals and beverages, and provide a relatively quiet place to get work done.
Airport lounge access is always nice for frequent travelers, which is one of the big perks of this card.
There isn’t one standard Priority Pass lounge — each one has unique features and may be run by a different company. Here are some other things you’ll have to keep in mind before using a lounge.
- Check if and where your airport has Priority Pass access. Mine isn’t much use to me because it’s only in the international terminal, and I primarily fly domestically.
- Don’t count on access for your whole family; you only get access for two guests.
- Don’t just walk up with your Sapphire Reserve card and expect to get in. You also have to register for Priority Pass. I found that out the hard way.
TSA PreCheck and Global Entry
You’ll also get other travel perks with the Sapphire Reserve, including an annual $100 credit for either TSA PreCheck or Global Entry. This perk, along with the $300 per year travel credit, more than makes up for the difference in annual fees between the two cards.
- TSA PreCheck: This allows you to enter the expedited security line so that you can get to your gate faster.
- Global Entry: With this, you’ll get the TSA PreCheck status plus expedited U.S. Customs screening for international air travel when entering the United States.
Upgraded Purchase Protection and Travel Insurance
Most people overlook secondary benefits on credit cards like purchase protection and travel insurance. But these can come in handy.
Travel insurance protects your investment in a trip. If you get sick or have some other sort of emergency, you won’t lose your money if you can’t go. But unlike home or health insurance, this isn’t regulated, so plans can vary wildly.
Here’s what Chase Sapphire Reserve covers:
- Trip delay reimbursement: Up to $500 per ticket if you have a delay of at least six hours.
- Baggage delay benefit: You can get a reimbursement of up to $100 per day for as many as five days if you have to buy items because your baggage is delayed for at least six hours.
- Lost luggage benefit: The max you can get is $3,000 per person.
- Trip cancellation insurance: You can get reimbursed up to $10,000 if a covered loss is the reason you can’t go on a trip.
- Trip interruption insurance: If your trip is interrupted, you can get as much as $10,000 reimbursed to you.
- 24-hour travel and emergency assistance services: The card offers referrals and assistance if you need emergency services.
- What is purchase protection?: This feature protects your new purchases from theft or damage (including accidental damage) for 120 days.
- What the Chase Sapphire Reserve offers: The Reserve will provide purchase protection of up to $10,000 per claim up to a maximum of $50,000 per year.
- What the Preferred offers: The Preferred still has a generous purchase protection program. You can get $500 per claim and a maximum of $50,000 per account, per year.
These are great perks that are wasted by some cardholders who don’t even know they exist. Whichever credit card you decide to apply for, make sure you understand every perk available so you can take full advantage of them.
Why Apply for the Chase Sapphire Preferred?
Higher Sign-Up Bonus
Lower Annual Fee
The much lower annual fee should be appealing to those on a tighter budget.
You Don’t Spent Much on Travel
Maybe you don’t have the extra funds for more travel, or you don’t have enough vacation time at work. If you don’t spend a significant amount each year on travel and dining, you should consider the Preferred over the Reserve.
How many authorized users do you plan to add to your account? With the Preferred, you can add them for free. But with the Sapphire Reserve, each authorized user is $75. This can add up quickly if you’re adding a spouse and children.
Can You Apply for Both at the Same Time?
Once you get one of these cards, you have to wait 48 months before applying for the other. But if you get one and feel it isn’t right, you can always switch to the other one.
Chase Sapphire Reserve vs. Preferred for Travelers Summary
The decision between these two cards is one many travelers face.
The important things to keep in mind are to find the card that:
- Helps you reach your travel goals
- You’re more likely to keep long-term, as it’s best suited for your spending habits
Keep those two goals in mind and you’ll make a decision you won’t regret.