Chase Sapphire Preferred vs Reserve: Which Is Better?

Posted on April 11, 2021 in Credit Cards

When it comes to travel credit cards, two of the most popular options are the Chase Sapphire Reserve and the Chase Sapphire Preferred. Both of them are a part of the widely popular and valuable Ultimate Rewards program offered by Chase. They are currently offering promotional sign-up bonuses that can make them even more valuable to first-year cardholders. While the Chase Sapphire Reserve card is the higher tier card, with a higher annual fee and more luxury benefits, most people will assume it’s the superior card. 

However, that’s not necessarily true as the Chase Sapphire Preferred offers a higher sign-up bonus of 80,000 points after you spend $4,000 in the first three months of opening an account. In addition, your specific spending habits, travel goals, and existing credit card lineup may result in Chase Sapphire Preferred being the better option for you. 

Comparison Of The Two

It’s important to note that you can’t hold both the Sapphire Preferred and the Sapphire Reserve at the same time, and you will need to wait at least 48 months between earning the sign-up bonus on one card before getting it on the other. 

Chase Sapphire Preferred

  • Annual Fee: $95
  • Earning Rates: 5x on Lyft, 2x on travel and dining, 2x on groceries (up to $1,000 spent per month through April 30, 2021), 1x on everything else
  • Sign-up Bonus: 80,000 bonus points after you spend $4,000 in the three months after opening the account. A $50 statement credit on grocery purchases in the first year of the account opening.
  • Ultimate Reward Travel Portal Redemption Rate: 1.25 cents per point
  • Built-in Credits: Up to $60 back on Peloton Digital or All-Access membership (through December 31, 2021)
  • Lounge Access: N/A
  • Authorized User Fee: $0
  • Rental Car Insurance: Primary, “expensive and exotic cars” are excluded
  • Roadside Assistance: $59.95 per service call
  • Trip Cancellation Insurance: Up to $10,000 per covered trip
  • Trip Delay Insurance: Up to $500 per ticket for delays of 12 or more hours 
  • Baggage Delay Insurance: Up to $100 per day for up to five days
  • Lost Luggage Reimbursement: Up to $3,000 per person 
  • Travel Accident Insurance: $500,000 for common carrier loss of life benefit, $100,000 for 24-hour loss of life benefit
  • Purchase Protection: Up to $500 per claim and up to $50,000 per year

Chase Sapphire Reserve

  • Annual Fee: $550
  • Earning Rates: 10x on Lyft, 3x on travel and dining, 3x on groceries (up to $1,000 spent per month through April 30, 2021), 1x on everything else
  • Sign-up Bonus: 60,000 bonus points after you spend $4,000 in the three months after opening the account
  • Ultimate Reward Travel Portal Redemption Rate: 1.5 cents per point 
  • Built-in Credits: $300 annual travel credit, $60 annual DoorDash credit (through December 31, 2021), up to $120 back on a Peloton Digital or All-Access membership (through December 31, 2021)
  • Lounge Access: Priority Pass Select
  • Authorized User Fee: $75
  • Rental Car Insurance: Primary, provides reimbursement of up to $75,000 for theft and collision 
  • Roadside Assistance: Up to $50 per incident, up to four times annually
  • Trip Cancellation Insurance: Up to $10,000 per covered trip
  • Trip Delay Insurance: Up to $500 per ticket delay of six or more hours
  • Baggage Delay Insurance: Up to $100 per day for up to five days 
  • Lost Luggage Reimbursement: Up to $3,000 per person
  • Travel Accident Insurance: $1,000,000 for common carrier loss of life benefit, $100,000 for 24-hour loss of life benefit
  • Purchase Protection: Up to $10,000 per claim and up to $50,000 annually

The Chase Sapphire Reserve

It’s pretty clear that the Chase Sapphire Reserve is the more premium offer of the two cards. You are more likely to get better value if you are a frequent traveler. If not, this card may not be the right one for you.

Premium Travel Benefits

The largest difference between the two cards is probably the difference in travel benefits. The Reserve will give you a $300 travel credit annually, a $100 credit for the TSA PreCheck or Global Entry application fee every four years, and a Priority Pass Select membership that will grant you entry into airport lounges around the world. 

Additionally, as part of a new partnership with DoorDash, Reserve cardholders will receive a $60 annual credit to use with the food delivery company in 2021 and a one-year complimentary subscription as well. This will waive the delivery fee at eligible restaurants and will discount service fees on orders of more than $12. Another benefit is the free one-year Lyft Pink membership, including a 15% discount on all rides and free bike and scooter rentals every month. For Peloton users, the Reserve will offer up to $120 statement credit toward the monthly class subscription. 

While the Reserve may come with a $550 annual fee, utilizing these perks effectively can more than offset the cost.

Higher Earning Rates

The Reserve card has a higher earning rate than the Preferred, especially for those spending a lot of money on Lyft, travel, or dining. For example, if you spend $50 a month using Lyft and $1,000 per month on travel and dining, this is how differently your yearly earnings will end up:

  • Reserve: $50 x 10 points x 12 months = 6,000 points

$1,000 x 3 points x 12 months = 35,1000

6,000 + 35,100 = 41,100 Ultimate Rewards points

  • Preferred: $50 x 5 points x 12 months = 3,000 points

$1,000 x 2 points x 12 months = 24,000 points

3,000 + 24,000 = 27,000 Ultimate Rewards points

By using the same ride-share service and spending the same amount of money, you will gain 14,100 more Ultimate Rewards points in the above example. This will roughly end up being around a $280 difference in annual rewards value.

50 % Redemption Bonus

In addition to a higher earning rate, the Reserve will also come with a higher redemption rate when booking travel through the Chase Ultimate Rewards portal. The Reserve will allow you to redeem each point at 1.5 cents toward travel, while the Preferred is only rated at 1.25 cents. For example, a $600 planet ticket will cost you 48,000 points using the Preferred card, but only 40,000 points with the Reserve.

Better Trip Insurance

The Reserve will come with nearly double the coverage amount on most travel-related benefits such as accident insurance and purchase protection. While this may not be a huge difference-maker on its own, it can be pretty good icing on the cake when factored in with the other benefits.

The Chase Sapphire Preferred

It’s pretty clear the Chase Sapphire Preferred isn’t much competition for the Reserve when directly compared, but this card could still be the better option for you for a few reasons.

Elevated Sign Up Bonus

The Preferred currently has a much better sign-up bonus than the Reserve. Right now, you will earn 80,000 bonus points after you spend just $4,000 in the first three months after opening your account. In addition, you will earn a $50 statement credit on grocery purchases in the first year. The Ultimate Rewards points exchange rate means this bonus is worth up to $1,650. The Reserve is only offering 60,000 bonus points, putting its value only around $1,200. 

Lower Annual Fee

Another strong advantage to the Preferred card is the significantly lower annual free. The Reserve will cost you $550 every year, while the Preferred will cost $95. Although it’s important to note that the Reserve will come with a $300 annual travel credit, meaning the effective cost is only about $250 per year. That brings the difference down substantially, but it is still a $155 difference annually. Although, that’s only for travel, so if you don’t think you’ll spend $300 a year traveling, then it would be wasted on you. 

Easier To Get Approved

As an ultra-premium tier card, the Reserve will require a top-notch credit score for approval. The Preferred will still require a score somewhere in the high 600s to the 700s to be approved, but you will have a much easier time getting this card if your score is on the lower end of the optimal range.

The Takeaway

When it comes to luxury and premium levels of perks, Reserve is the better option. However, Preferred is still a terrific option to consider as well. It will all depend on you and your specific spending habits as to which is better. 

Having a $300 travel credit annually is a great deal if you intend to travel and use it. The same is true with DoorDash and Lyft bonuses. Those perks will help to compensate for the $550 annual fee of the Reserve very quickly, but only if you use them. If you don’t travel particularly often, rarely order out, and drive yourself around town, then you will not get a very good value for these deals. As a result, the Preferred card may be the better option for you. Ultimately, each card will have lots of benefits depending on your specific spending habits. 

SOURCES:

https://www.businessinsider.com/personal-finance/chase-sapphire-preferred-reserve-credit-card-comparison

https://creditcards.chase.com/a1/21Q2/sapphire/goreserve/onecta?CELL=6H8X&AFFID=pngc6t7Ewoo-Z69SvWWxs9Jco6FQVnpyJw&pvid=007ccecd9edc4ea190f48260ef3ec4c6&jp_cmp=cc/866357/aff/3-10003820/na

https://www.cnbc.com/select/chase-sapphire-reserve-vs-chase-sapphire-preferred/

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