Chase Sapphire Reserve Vs Preferred Breakeven – Which One Should You Get?

Chase Sapphire Reserve Vs Preferred Breakeven – Which One Should You Get?

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The best every day credit card is from the Chase Sapphire series. There are two cards from the series, the Chase Sapphire Preferred and Chase Sapphire Reserve.

One of the cards should be in your every day rotation and should be the first card you get, especially if you’re starting to optimize your credit card rewards.

In this post, we’ll go over the most commonly used and major benefits in the first part. We’ll give a thorough comparison for the rest of the benefits (there’s a ton!) at the end.

Why Should You Start With A Chase Sapphire Card?

The most common question I get from people about credit cards is which card they should start out with, and why.

The Chase Sapphire cards earn Ultimate Rewards (UR) points, which are incredibly valuable given their flexibility and great transfer partners. You can redeem these points via the travel portal or transfer them to airlines and hotels 1:1 via 13 travel partners.

50,000 In Bonus Sign-Up Points (Valued at $625 to ~$1,000)

You get 50,000 bonus points for either card after you spend $4,000 in 3 months. Most credit cards offer a sign-up bonus, but the Chase Sapphire card’s bonus is amongst the best.

Remember, when you’re opening a credit card, don’t spend extra money, but just put your existing spend on the card. If you get the Preferred, that’s $625 in travel portal redemption. For the Sapphire, it’s $750.

However, you’ll get the biggest bang for your buck when booking business class international flights, luxury hotel stays, or last minute flights. If you go this route, you can extend your 50,000 points to a few thousand dollars when redeeming.

UR Points For Every Dollar You Spend

You get 1x Chase UR point per dollar spent, except for the special category of dining and travel.

The Chase Sapphire Preferred card offers 2x on dining and travel and the Reserve offers 3x. The benefit here is that Chase codes unexpected things as travel and dining:

  • Seamless/Grubhub, Postmates, other delivery services (check, not all delivery systems do)
  • Uber, Lyft, other rideshares, taxis
  • Airbnb, Expedia, Travelocity, Priceline, etc
  • tolls
  • Airfare, timeshares, and cruise lines

I don’t know about you, but all I do is spend money on dining, travel, or clothing. Well, and rent, but no credit card gives bonuses for that. Unfortunately, no credit card offers bonus points for clothing spend either so, this captures the majority of my spend categories, and probably yours too.

Free Priority Pass access to free food and lounges. Here’s a breakfast spread at the Turkish lounge in DC.

Travel Portal Bonus Spending

Points can be redeemed either in the travel portal for 1.25-1.5 cents per point or via travel partner transfers for the Preferred or Sapphire. Here are some of a few trips I’ve taken or planned on with UR points:

Other benefits include no foreign transaction fees, incredible travel and rental benefits, purchase protection, and more. Some of the better travel benefits include trip cancellation/interruption/delay, complimentary car rental insurance, purchase protection up to $500 per item to start. We’ll go over these more in-depth later on in this post.

The 5/24 Rule – Why You Need To Start With Chase Cards

Chase has a rule called 5/24, which says that you’ll automatically be denied for the Chase Sapphire Preferred or Reserve if you’ve opened 5 or more cards in the past 24 months. Keep in mind that being an authorized user counts as “opening a card”. However, you can call the Chase reconsideration line and they’ll look at your history without authorized user and decide based on that.

This rule basically makes it worthwhile for your first 5 cards to be Chase cards.

Chase Sapphire, At A Glance

What Factors Are We Considering In Our Breakeven Calculation?

The biggest difference is that the Preferred offers 2x rewards per dollar on travel and dining, while the Reserve offers 3x rewards per dollar.

This means that the breakeven point for getting the Reserve vs the Preferred is if you spend more than $3,667 per year on travel and dining. On a monthly basis that is $306. If you spend a lot more than that per month on travel and dining, then you should get the Chase Sapphire Reserve because you come out way ahead.

Travel includes:

  • Uber, Lyft, other rideshares
  • Airbnb, Homeaway, other booking sites
  • Priceline, Expedia, Kayak, other airfare/hotel sites
  • Car rentals
  • Subways, taxis, and trains

Unfortunately, gas is not counted in travel!

The Reserve also offers unlimited access to Priority Pass Lounges. There are currently 1,200 lounges in more than 100 countries. Here’s an example of lounges we’ve been to:

  • Most lounges offer free food (charcuterie meat + cheese, sandwiches, breakfast staples, and hot food), comfy couch-like sitting areas, giant TVs, showers with provided amenities.
  • A few super-fancy lounges offer massages (a person giving them or a chair) and food made on demand (most notably ANA lounges in Narita)
  • A brand called Minute Suites offers: Free hour in a minute suite. It includes a desk, bed, and Alexa machine. These are US based.
  • Food credit: Up to $30 in food credit at specific airports without Priority lounges. In my experience, a fancy bento box in Singapore probably worth $20 in an airport setting and $30 in Sydney. I’ve only seen international airports offer this.

How Much Is Priority Pass Worth?

This is how Priority Pass prices their memberships:

Standard: $99/year and each visit is $27

Standard Plus: $239/year for 10 visits, then $27 after

Prestige: $399 for unlimited membership

Since the Reserve offers unlimited membership, they’re offering the tier that costs $399. You can bring a guest too, so I suppose that’s double the price. Unfortunately, most of us aren’t road warriors, so I don’t think it’s fair to value Priority Pass at that price point.

Here’s how I think you should value Priority Pass:

  • Estimate how many times you travel per year.
  • How much would you value a Priority Pass visit?
  • You get 1 free guest per visit. Will your partner have Priority pass as well? If you’re a family and both of the adults have a Reserve, you can get a family of four in for free.

Valuing the dollar value per Priority Pass is different for everyone. For me, I value it at at least $10 per visit. $20 for a round-trip. I love visiting lounges during trips and it feels so relaxing and luxurious. The relaxation and quiet in a chaotic airport and free meal are enough for me to value it there.

Global Entry or TSA Pre✓®

The Reserve offers free Global Entry or TSA Pre✓® every 4 years. It’s only available to US citizens or permanent residents (Green card holders). 

TSA Pre✓® allows you to go to a special line where you don’t need to take off your shoes/belts/etc or laptop/liquids. It’s available for domestic origination -> domestic arrival flights. Not having to worry about standing in my socks on a floor that thousands of people walk through everyday and not having to take out a bunch of items from my perfectly packed bag is pretty satisfying to me. Plus, that line is just so much quicker! 

Global Entry costs $100 while TSA Pre✓® is $85. Global Entry includes TSA Pre✓®. For an extra $15, you can go through customs faster when you come back from international flights. Global Entry includes all flights that arrive in the US. After a 14 hour flight from Tokyo to NYC, it was so awesome to be able to breeze through customs with Global Entry and take an Uber home.  

If you care about expediting your life and fly a bunch every year, this perk should be worth $25 a year. If you don’t care about it, it should be worth $0.

Complimentary Travel & Car Insurance

I used to pay for the travel insurance offered on flights. I don’t anymore, now that I have the Chase Sapphire Reserve. Travel insurance costs between 4-10%, and it’s extremely nice to save those extra dollars.

You know where car rental companies make their money? Rental insurance and all the add-ons. Rental insurance costs $15+ per day usually, while the Chase Sapphire cards offer free rental insurance. This always saves us a bundle on car rentals.

Fee Breakeven

The Preferred has no fee for the first year, then $95 after that, while the Reserve has a hefty $450 fee.

Remember that the Reserve comes with a $300 travel credit that is automatically applied to your account. That means you’re left with a net $155 fee. Since the Preferred costs $95 per year, it’s only an extra $55 for the Reserve.

So, What’s The Breakeven Equation?

Choose the Reserve if:

“Extra Points Earned in Travel and Dining Spending” + “Value of Priority Pass To You” + “Global Entry or TSA Pre✓® value” > $55

Extra Points Earned in Travel and Dining Spending = $spent on Travel & Dining *.01

Value of Priority Pass = # of times you travel per year * value of round-trip Lounge access to you * # of people getting into the lounge

Global Entry or TSA Pre✓® value should be between $0 and $25, because we’re comparing annual fees

Quick breakeven points:

  • If you spend more than $3,667 on dining and travel, go with the Reserve.
  • Think Priority Pass is worth more than $55 per year?  Go with the Reserve.
  • If you value Global Entry or TSA Pre✓®, and if you spend more than $2,000 per year in the dining and travel categories, go with the Reserve

What if nothing is clear in the above quick breakeven points? Use the equation.

Important To Consider

If you can’t afford to prepay the $450 annual fee, then you should go with the Preferred.

Always pay off your credit card in full each month so you don’t pay interest. Credit card APYs can be 20%+.

Thorough Chase Sapphire Preferred Vs. Reserve Comparison

Transferring points from Chase UR to United allowed us to fly business for free from NYC to Tokyo. A lie-flat seat is heavenly during a 14-hour flight.

Where Do Chase UR Points Transfer To?

UR points travel to the below airlines:

  • Air Lingus AerClub
  • Air France Flying Blue
  • British Airways Avios
  • Iberia Avios
  • Korean Air SkyPass
  • Singapore Airlines KrisFlyer
  • Southwest Rapid Rewards
  • United Mileage Plus Rewards
  • Virgin Atlantic Flying Club

And the below hotels:

  • Hyatt Gold Passport
  • IHG Rewards Club
  • Marriott Rewards Points
  • Ritz Carlton Rewards

We created a handy summarized chart for all the benefits and compared them. Some benefits are the same, so we simply merged the cells together. Some benefits have terms and conditions, so be sure to check the benefits portal. Take a look at the website for when you need to use some of them, ie. where to submit claims and when, things like that.

$95 fee, waived the first year.

Check Out The Chase Sapphire Preferred

$450 fee, with $300 in travel credit.

Check Out The Chase Sapphire Reserve

Which card did you guys start with?


Author: Olivia

Olivia worked in finance and wants you to learn the secrets of financial independence. She believes there are so many ways to monetize your life and make money doing the things you're already doing because so many companies offer free money.

The average savings account rate is 0.1%. The big banks have incredibly low savings accounts rates. CIT Bank offers a 1.75% savings account. You can open an account with just $100 and no monthly fees or charge . Tired of being charged fees and getting peanuts in interest at your current bank? Open a CIT Bank savings account in less than 15 minutes online.

If you have a car, Rideshare apps allow you to pick a direction you want to go twice a day, so you can get extra money going somewhere you were driving to anyway at least twice a day. Get a $300 sign-up bonus with Lyft.

One of my favorite ways ways of monetizing my life is via credit card bonuses with cards that give you cashback or rewards. Check out our review of the Chase Sapphire cards, which give you at least $500 in cash or $625 in travel credit.

5 thoughts on “Chase Sapphire Reserve Vs Preferred Breakeven – Which One Should You Get?

  1. I must be missing some action since we don’t have either. We found out about the 5/24 rule right after we applied to other credit cards and it’s just been 2 years of patience. Thankfully those 2 years flew by and I think the Sapphire preferred will be next on the hit list.

  2. We used the preferred card for a year (fees waived the first year), and then cancelled it. Right now, we don’t really “travel hack”, we just take cashback from whoever offers it.

    I have an Amazon credit card that gives me 5% off on all purchases, and Amex blue cash preferred that gets me 5% off on groceries. I have a gold delta skymiles card, but that is going away soon. We did get a few free tickets based on our usual spending. We also have some cards that get us 2% or so on restaurants, but we hardly eat out. And I think we get 3% cashback on gas, and 1% on everything else. Not too bad.

    Most of our traveling is via road (hate the planes, and like driving) and we only pay for hotels – have a Amex Hilton card for that, and it works out pretty well.

    I guess we can do way better, but haven’t tried yet.

  3. Hmmm… reading the breakdown when you include the dining/travel cash back makes me wonder if I shouldn’t have gone with the Reserve. Though that doesn’t factor in the times when we’re using a different card to meet a minimum spend, so we may not hit that number on the Sapphire after all.

  4. Went back and forth on the Preferred vs the Reserve. Ultimately I went with the Preferred for the $0 fee the first year and the referral bonus (so we both ended up getting our own cards). I know the math probably says that Preferred is better, but I can always upgrade to it in the future.

    Great comparison of the two cards!

  5. Don’t forget that you can earn the $300 travel credit twice the first card membership year with the Chase Sapphire Reserve. This is because it is honored for each calendar year. So if you open CSR in July 2018, you can use the $300 credit for 2018 then when January 2019 comes around you can use it again. So you can use $600 worth of travel credits then by the time the annual fee comes up, you can decide to cancel the card, downgrade it to CSP, or keep it. Either way, you come out ahead with the CSR because of this.

    Also, I think the Chase Ink Preferred is even better for every day spending for frugal people who don’t spend a lot on dining. You get 3x points on internet, cable, and phone services. Almost everybody pays for internet services :).

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