I’ve been a little late to the game with travel reward hacking.
One would think it’d be top priority for someone who already has free flights, but for some reason, my employee perks almost had the opposite effect. I was all, “My airfare is free, I don’t care about paying for a hotel!”
To some extent, this is still valid—but I realized I was leaving a lot of money on the table within the credit card game.
Everyone who regularly hangs out around here knows my favorite starter card is the Discover It card. This is ideal for someone who has no credit history. Another great option is the Chase Freedom card. (Classic no-annual fee cards with decent cash back perks.)
This article is for those of you who already use a credit card regularly and have a pretty good credit score (upper 600s or higher), but want to cash in on better rewards and get some free travel out of your regular spending (no brainer).
I’ve done a lot of research (both anecdotally and online) about the best travel cards. The Points Guy is the ultimate resource for this stuff; his blog-turned-media site has breakdowns of all the really complicated situations you can throw together with multiple cards to get thousands of dollars in free travel.
In the travel rewards world, credit card churn is the name of the game: signing up for the fat bonuses, using the bonuses, canceling the cards, and starting over. Not great for your credit score and requires a lot of planning and attention to detail, but excellent in terms of freebies if you're really good at it and space everything out appropriately.
That’s a wee bit advanced, though, and if you’re reading this article, I’m going to assume you’re a beginner, too.
Despite the allure of the American Express Platinum card during my research, its $550 annual fee was a little tough to choke down. I also looked into the Capital One Venture Card, but kept coming back to the Chase Sapphire products.
Regardless of where I looked, it seemed as though everyone held the Sapphire cards in high esteem—my wealthier, more-successful-than-me friends, the most basic blogs, and, of course, the Travel Rewards Czar himself, The Points Guy.
I even read through tons of comments on his site to see what die-hard AmEx people had to say, and still walked away feeling like the Sapphire products were probably my best bet.
Chase has recently changed the rules of the game with their Sapphire products. While you used to be able to hold both cards simultaneously (i.e., signing up for both and getting both sign-up bonuses of 50,000 points for a total of 100,000 points, or about $1,500 in travel), now you can only have one at a time. *tiny violin plays softly from my wallet*
This is a little bit of a bummer for those of us who are late to the game—it seems as though Chase caught on to the fact that savvy credit card users were hacking their system and getting a shit ton of value out of the cards, then closing them after cashing in.
While the bonuses aren’t as stellar, there’s still a lot of value to be derived from one or the other. Just note before you apply that Chase has this thing called the 5/24 rule—if you’ve applied for 5 new lines of credit in the past 24 months, it’s very unlikely you’ll be approved.
(Unless you’re opening new credit cards every couple months, this probably won’t affect you, but it crucial knowledge for people who are planning a credit card churn for travel rewards.)
After I settled on a Sapphire card, I had to pick which one.
There are two: the Sapphire Preferred and the Sapphire Reserve.
While the sign-up bonus is the same, there are a lot of additional perks with the Reserve—a $300 travel credit, access to Priority Pass airport lounges, a $100 TSA Precheck/Global Entry credit, and more.
Here’s the kicker: The Reserve card has an annual fee of $450, whereas the Preferred card has an annual fee of $95 that’s waived for the first year (no such courtesy exists for the Reserve).
Here’s the official breakdown.
I really wavered on this one and took a few weeks to think about the difference in value. While I was hard-pressed to justify the Reserve’s $450 annual fee, I knew the $300 travel credit effectively dropped it to $150—only $55 more than the Preferred card.
I also knew I’d probably use the airport lounges, which usually have free food and drinks inside—I easily spend $55 on dinner at an airport when I’m stranded, especially when we buy a bottle of wine (shout-out to the Atlanta Hartsfield-Jackson bar crawl).
At that point, it just came down to the remaining $95. How do you justify that part upfront? Well, it’s pretty easy—50,000 points is worth either $625 with the Preferred card or $750 with the Reserve card in the Chase Ultimate Rewards portal, where you can book airfare, hotels, or buy products (not the best value, though—your money goes furthest with travel).
So there I was, effectively deciding between a card that would cost me nothing upfront for a year but be worth $625 in travel credit, or one that would cost me $450 upfront and be worth $750 upfront with a $300 travel credit and numerous other shiny premium perks (suffice it to say, I had visions of myself in a fluffy white hotel robe downing free margaritas in airport lounges).
The "travel perks" rabbit hole is an easy one to hurl yourself into—cards like the aforementioned AmEx Platinum (that competes with the Reserve card and carries a $550 annual fee) feature automatic upgrades at hotels. In other words, you book a hotel room, show up, and get a fancier one (if available).
All that to say: it's really easy to get tangled in a web of presumed luxury when trying to decide which card will give you the most value.
I knew my vacillating was wasting precious time. After all, I wanted these points for my early 2019 trips (anyone else keep a laundry list of hypothetical vacations and dates at all times? No?).
Decidedly, I smashed that Apply button on the Sapphire Preferred Card.
You may be surprised by this—I was even a little surprised myself, after becoming nearly convinced that the Reserve was the way to go.
Here's why I chose the Preferred and my plan for moving forward:
But let's say six months into 2019 I realize I should've gone with the Reserve...
The back-up plan
Although upgrading the Preferred card to a Reserve card is possible (if you change your mind), you're no longer eligible for the Reserve's sign-up bonus (i.e., 50,000 MORE points) after getting it on the Preferred. Upgrades aside, you also aren't eligible for a second Sapphire sign-up bonus within 24 months of opening your first Sapphire card.
In this way, they're limiting you to one 50,000-point bonus every two years.
Keep in mind you can't have two Sapphire products at once. So, you can't keep the Preferred and open the Reserve for the sign-up bonus, too (although you used to be able to). The audacity!
So here's the work-around and my plan moving forward if I decide the Reserve is for me:
The bottom line
I know there are a lot of perks being left on the table with the Reserve and that it's effectively only a $55 difference when you factor in the travel credit, so we can all point and laugh as I reason with emotion over math.
(The math is actually that you'd need to spend at least $3,660 on travel & dining per year to make up for that $55 difference in annual fee, if you're just looking at the purchases > points earnings.)
But for me, a travel rewards noob with a unique situation (free airfare), starting "small" made sense to me—especially since I have a plan to churn the cards if I decide to level up later (a couple 'stuck in the airport in need of wine' experiences would be enough to do it, most likely).
Think the Preferred card may be right for you? It's still a 50,000 point bonus right now!
And if you're feeling generous, use my "refer a Friend" link.
The young woman's money guide for all the things you're too embarrassed to ask your friends. Build the life you thought you were too broke to afford through managing your spending habits, travel hacking, and simple, smart investing.
Full-time Brand marketer at Southwest Airlines, part-time Yoga Sculpt teacher, occasional Waffle House Model and reformed materialist.
Download my free budget tool
Rent or buy calculator
Invest with Robinhood. Get free stock.