Why the Chase Sapphire Preferred is (Wildly) Overrated
Tl;dr: Very good at many things but the best at almost none, the CSP struggles to justify its annual fee.
If you’re just getting started with travel rewards credit cards, the Chase Sapphire Preferred (CSP) is probably on your radar. It is, after all, “the top travel rewards credit card year after year,” “the best card for beginners,” and “nearly a must-have for travelers,” according to seemingly all the travel and credit card sites out there.
These days, though, that’s just wrong. Although the CSP is a very, very solid card, it charges a true annual fee for services that you can get for free, and offers earning rates, redemptions, and consumer protections that can all be bested by other, cheaper cards. Although there are indeed a few situations where it makes some sense to get a Chase Sapphire Preferred, the card’s merits simply do not live up to its lofty reputation.
It charges a real annual fee
When I’m considering a credit card, I am mostly concerned with its net annual fee—that is, the annual fee charged minus the statement credits that you can be sure to get based on your pre-existing spending.
The CSP charges a $95 annual fee, that is only offset in two significant ways. First, there is a $50 credit towards a hotel booking via the Chase travel portal. Second, you receive 0.1 points for every dollar spent the previous year upon renewal.
If you book at least one hotel stay each year, you’ll probably be able to use that statement credit, bringing the net annual fee to $45. But to bring that net annual to zero, you would need to spend $36,000 just to break even on the annual fee with the point bonus (assuming a redemption value of 1.25¢ per point). That is a lot.
There are many great credit cards out there that are no-fee or no-net-fee. These include no-fee cards like the Bilt Mastercard, cards that are no-net-fee for almost everyone like the Capital One Venture X and IHG Premier, and cards that may net out to zero (or net-negative) fee depending on your spending, like the Amex Gold and Delta Amex Platinum, and Citi Strata Premier.
With so many great credit cards out there that you can hold for free, why would you pay to hold the Chase Sapphire Preferred?
Other cards earn points faster
Earning 5x points on travel booked through the Chase travel portal, 3x on dining, online grocery purchases, and select streaming services, 2x on all non-Chase travel purchases, and 1x on all other spending, the CSP’s earning rates are undoubtedly excellent. But other cards will earn points at the same rate, or even faster.
For dining, the Amex Gold earns 4x on dining, while many cards earn 3x, including the Bilt Mastercard, Chase Sapphire Reserve, Capital One Savor, and Citi Strata Premier.
For travel, the Amex Gold earns 4x on flights, the Citi Strata Premier earns 3x on air travel and hotels, the Bilt card earns 2x on most travel, and the Capital One Venture X earns 2x on all purchases, including travel.
For base spending, the Venture X, Citi Double Cash, and Wells Fargo Active Cash earn 2x or 2% cash back on all purchases, and almost all cards earn at least 1x like the CSP.
The points aren’t the best
With an option to redeem points for 1.25¢ each when booking travel through Chase, a high-value transfer partner in Hyatt, and useful domestic airline partners in United, Southwest, and JetBlue, Chase points are, again, excellent. But Bilt points are better, and Amex points aren’t far behind. Although Chase points are better than Citi or Capital One points, the difference isn’t vast (I would rather have a Chase point than a Capital One mile, but two Capital One miles are clearly better than one Chase point).
The protections could be better
The CSP comes with rental car coverage, baggage and trip delay insurance, trip cancellation/interruption insurance, purchase protection, extended warranty protection, and no foreign transaction fees. This is a solid suite of benefits, but the no-fee Bilt card offers all of these except the extended warranty and baggage delay benefits. The Venture X offers all of these except the baggage delay insurance, and adds purchase return protection and cell phone insurance, and offers more robust benefits like trip delay benefits that kick in after 6 hours of delay versus 12 for the CSP.
The Chase Sapphire Preferred is wrong for most people
You can break down credit card users into two groups: those that want only a single card, or those who prefer a diverse stable of cards to maximize benefits.
If you only want a single card, you probably want the Bilt Mastercard. If you pay rent, that’s an extremely easy choice, with that benefit making it far superior to the CSP over the long run. But even if you can’t earn points on rent, the Bilt is still a better choice. It has no annual fee, earns the same basic 3/2/1x points on dining/travel/base spending, and the points it does earn are better than Chase points. Both cards offer similar benefits, while Bilt has the added bonus of benefits like Rent Day and Neighborhood Rewards. These upsides will outweigh the CSP’s few marginal advantages for most people.
And if you want to manage multiple cards, the CSP’s place in your wallet is even harder to justify, as you can mix and match cards for the best earning rates, protections, and perks (like hotel elite status). If you have a good setup, you will almost never use your CSP, as there will be a better card to use 98% of the time.
Who should get a Chase Sapphire Preferred, and when?
Despite all that, there are some times that some people might want to pick up a CSP.
For the bonus. Most obviously, it is a great bonus card. Wait for the bonus offer to reach 75-80k, use the card enough to earn those points (worth over $900 in travel), and then move on to other bigger and better things later.
Chase enthusiasts. Although the CSP on its own is underwhelming, you can pair it with a Chase Freedom Unlimited to earn 1.5x on all base purchases and 3x on drugstore purchases, and/or a Chase Freedom Flex to earn 5x on rotating quarterly categories. This seems like a lot of work, but it is probably the best way to earn if you want to accumulate maximum points within a single rewards program.
Single-card non-renters. Although I think the Bilt card is better than the CSP even for non-renters, if you’re only going to have one card, the CSP Visa’s ever-so-slightly wider worldwide acceptance than the Mastercard and the marginally better protections might justify the annual fee for some people.
Southwest enthusiasts. Bilt and Amex may have better transfer partners than Chase in general, but if heavy users of loyalty programs that transfer from Chase but not other banks (SWA, most likely) might find it worthwhile to earn Chase points specifically.
Conclusion
The Chase Sapphire Preferred is a very solid card, and is probably worth acquiring for bonus-seekers and Chase Ultimate Rewards enthusiasts. However, do “you need the Chase Sapphire Preferred”? Absolutely not. The card is outshined on its own terms by the no-fee Bilt Mastercard, is bested in more premium offerings by the cheaper-to-hold Capital One Venture X, and many other cards offer superior earning and benefits at a lower cost. Whether you want a single card or a collection, the Chase Sapphire Preferred is probably not worthy of a long-term wallet slot.