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Chase Sapphire Preferred® Credit Card Review

By Christina Majaski

Reviewed by:
Rating:
4.5
On February 26, 2014
Last modified:May 6, 2014

chase sapphire preferred cardWhen choosing a travel rewards card, you need to consider your spending habits, how often you plan to use the card, whether you intend to pay the balance in full most months, and how you want to redeem the rewards you receive.

The Chase Sapphire Preferred® Card is a popular choice for frequent travelers – but is it right for you over the regular Chase Sapphire Card and other travel cards?

Key Features

  • Sign-up Bonus. Earn 40,000 bonus points when you spend $3,000 within the first three months of opening your account. You can earn an additional 5,000 points when you add an authorized user to the account and make a purchase within the first three months. If redeem for travel through Ultimate Rewards, the total sign-up bonus is worth $540.
  • Fees. There is an annual fee of $95 which is waived the first year, and there is no foreign transaction fee. Balance transfers are $5 or 3%, whichever is greater.
  • APR. Just as with the Chase Sapphire card, the APR for the Chase Sapphire Preferred is 15.99% and may vary based on the prime rate. The APR for balance transfers is also 15.99%.
  • Rewards Program. You earn two points per dollar spent at restaurants (including fast food establishments), two points per dollar on travel (including airfare, hotels, cruises, rental cars, and more), and one point on all other purchases. You also earn an additional point (totaling three points) on airfare and hotel when you book through the Ultimate Rewards program provided by Chase. Points can be redeemed for cash in increments of $20, which equals 2,000 points.
  • 20% Off Travel. As a Chase Sapphire Preferred cardholder, you also receive 20% off travel including airfare, hotels, and cruises when redeemed through Ultimate Rewards, allowing you to redeem your 45,000 bonus points for a $540 flight.
  • Chase Blueprint Plan. With Chase Blueprint, you have four different options that allow you to manage and control how payments are applied to specific purchases and how your balance is paid off. “Full pay” can be used for everyday purchases such as gasoline from gas stations and small purchases that you don’t want to pay interest on. “Split” allows you to pay off a large purchase quickly, while “finish it” helps you create a plan to choose your monthly payment, or number of payments, in order to pay down your balance faster. “Track it” allows you to create a budget and manage spending for the most common purchases.

Advantages

  1. 45,000 Bonus Points. In addition to having one of the best travel rewards programs, Chase Sapphire Preferred offers 40,000 bonus points after you spend $3,000 in the first three months of opening an account and 5,000 points when you add your first authorized user and make a purchase within the first three months. If you redeem these points for cash or a statement credit, you receive $450. However, if you redeem them for travel through Ultimate Rewards, 45,000 points can get you a $540 flight. The regular Chase Sapphire card offers 10,000 bonus points, which is equal to $100, when you spend $500 in the first three months, and Capital One Venture Rewards offers 10,000 miles when $1,000 is spent in the first three months, also worth $100 cash.
  2. 7% Annual Points Dividend. Another significant difference between the Chase Sapphire and Sapphire Preferred credit cards is that the Preferred version earns a 7% annual points dividend. This dividend rewards you with an additional 7% on all points, including redeemed points, that have been earned on purchases throughout the year.
  3. Earning Points. The Ultimate Rewards program included with the Chase Sapphire Preferred card provides one of the best credit card rewards offers available. For example, the Capital One VentureOne Rewards credit card is currently offering 1.25 miles per dollar on every purchase, and Blue Sky from American Express awards one point for each dollar spent on all eligible purchases. The Sapphire Preferred offers two points per dollar on nearly every type of restaurant, as well as on airline travel, hotel stays, cruises, car rentals, train tickets, and even taxis.
  4. Easy Redemption of Points. The minimum required for cash is $20 or 2,000 points, with 100 points being equal to $1. In addition to cash, points can be redeemed in a number of other ways, from hotel stays, to airline tickets, gift cards, and merchandise. Gift cards may be purchased at face value (meaning a $20 gift card is 2,000 points) from hundreds of top retailers such as Macy’s, Gap, and Lowe’s. There are often sales and deals on gift cards, giving you the opportunity to purchase them at a discounted rate. Additionally, if you choose to shop online with the Ultimate Rewards Mall, your purchases earn points, often up to 10 per dollar spent. The points do not expire and can be accumulated and redeemed in an unlimited amount whenever you choose.
  5. Combine Points With Travel Programs. An additional benefit of the Sapphire Preferred card is that you may combine points from various Chase cards and other eligible travel programs at a rate of one-to-one without transfer fees. These travel programs include, among others, Southwest Airlines Rapid Rewards, Hyatt Gold Passport, and Marriott Rewards.
  6. No Foreign Transaction Fee. Foreign transaction fees on other cards can range anywhere from 1% to 3%. If you travel abroad frequently, it is important that you use a credit card with no foreign transaction fees. The regular Chase Sapphire card charges a 3% foreign transaction fee, but the Sapphire Preferred card charges none.
  7. Chase Blueprint. Pay down balances, manage your account, and decide which purchases are paid off first in order to avoid paying interest by utilizing Chase Blueprint, an option not offered by any other credit card issuer. It’s free, simple to use, and may even help you save money on purchases. It is a handy budgeting tool, especially if you add authorized users to the account and track expenses and spending for the entire household.

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Disadvantages

  1. No Introductory APR. Although the APR is fairly standard for this type of card, there is no introductory rate currently being offered. The BankAmericard Travel Rewards card is offering an introductory APR of 0% for 12 billing cycles on purchases, and the Capital One VentureOne card is offering a 0% introductory rate which escalates to a range of 11.9% to 19.9%.
  2. Annual Fee. The annual fee for the card is $95 per year, but is waived the first year. In comparison, the Capital One Venture Rewards Card, which earns two miles per dollar on every purchase, carries an annual fee of $59, also waived the first year, and charges an APR as low as 13.9%. The Blue Sky from American Express does not have an annual fee, but only earns one point for each dollar spent on eligible purchases. The minimum APR on the Blue Sky card is also slightly higher than the Chase Sapphire Preferred card.
  3. Penalty APR. There is a penalty APR of 29.99% on most Chase credit cards. This fee is applied in addition to any late fees or over-limit fees, and can be affected by other Chase accounts or loans. The penalty APR may also be applied to new purchases. Although they are not travel rewards cards, Discover it and Citi Simplicity have eliminated the penalty APR fee.

Final Word

The Chase Sapphire Preferred credit card is best if you travel and use the card regularly, or plan on using it while traveling outside of the United States. Additionally, the introductory bonus alone covers five years of annual fees. Cardholders who spend less may want to look at other cards such as the standard Chase Sapphire, which provides a smaller bonus but only requires $500 of spending in the first three months, and has no annual fee.

Verdict

The Chase Sapphire Preferred® Card is a better travel rewards card than the regular no-annual-fee Sapphire card – and many other credit cards – if you use it frequently for travel and restaurants. It is one of the best cards available for travelers, especially with the bonus of 40,000 miles for new cardholders, a 7% dividend that can be earned each year on points, and many opportunities available for maximizing and redeeming points earned.

Score

4.5 stars out of 5: Standard APR and annual fee for travel rewards cards, but easy to earn and redeem points, plus a huge bonus of 40,000 points. However, the annual fee and lack of an introductory APR make the Sapphire Preferred card less beneficial for consumers who don’t eat out or travel, or plan to use the card less often.

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Editorial Note: The editorial content on this page is not provided by any bank, credit card issuer, airline, or hotel chain, and has not been reviewed, approved, or otherwise endorsed by any of these entities. Opinions expressed here are the author's alone, not those of the bank, credit card issuer, airline, or hotel chain, and have not been reviewed, approved, or otherwise endorsed by any of these entities.

Christina Majaski
Christina Majaski has written for online and print publications since 2003 on topics related to personal finance, legal matters, parenting, and careers. She lives in the Minnesota tundra, where in her free time she enjoys reading, writing, interacting via social media, and hanging out with her daughter.

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