5 reasons the Chase Sapphire Preferred makes a great credit card for aspiring travel hackers

5 reasons the Chase Sapphire Preferred makes a great credit card for aspiring travel hackers

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  • The Chase Sapphire Preferred is one of the most popular and useful credit cards among travelers and rewards experts.
  • It’s easy to redeem points for the most value. While you can exchange them for cash or gift cards, the better options are to use them to book travel through Chase, or transfer them to the bank’s travel partners.
  • The card also comes with a suite of benefits, and has no foreign transaction fees.

If you’ve done any research into opening a new credit card or earning better rewards for your spending, then I’d be willing to bet that you’ve heard of the Chase Sapphire Preferred card before. There’s a good reason for that — it’s one of the most recommended travel rewards cards out there, whether you’re looking to dabble in “travel hacking,” or you just want to earn good rewards on your everyday spending.

There are a lot of different rewards cards out there — many of which are valuable — but the Sapphire Preferred is a great starter card, and for most people, can be a linchpin of their rewards.

Read on below for five reasons the Sapphire Preferred is an ideal card.

Keep in mind that we’re focusing on the rewards and perks that make these two cards great options, not things like interest rates and late fees, which can far outweigh the value of any rewards.

When you’re working to earn credit-card rewards, it’s important to practice financial discipline, like paying your balances off in full each month, making payments on time, and not spending more than you can afford to pay back. Basically, treat your credit card like a debit card.

You can earn more than 50,000 points when you sign up — that’s potentially enough for a flight to Europe.

The Sapphire Preferred offers a standard sign-up bonus of 50,000 Chase Ultimate Rewards points after you spend $4,000 in the first three months. Plus, you can earn an additional 5,000 points when you add an authorized user to your account and they make a single purchase, also within the first three months.

Travel website The Points Guy, which issues monthly valuations of various points currencies, considers Ultimate Rewards points worth an average of 2.1¢ each, factoring in all of the redemption options. That means that 55,000 points is worth an average of $1,155.

Earn double points on all travel and dining purchases — both categories are incredibly broad.

The Sapphire Preferred earns 2x points per dollar spent on every dining and travel purchase, and 1x points on everything else. Dining and travel are defined very generally, which gives you more opportunities to get double points.

For example, dining includes just about any place you’d eat or drink anything on the premises, such as restaurants, bars, cafés, bakeries, ice cream shops, fast food stands, brewery tap rooms (sometimes — it depends on how the tap room registered its point-of-sale system), and more. Even delivery services like Seamless and Grubhub count.

The Sapphire Preferred earns 2x points on all dining, including at bars that don’t serve food. Cristi Lucaci/Shutterstock

Travel, similarly, includes just about everything, big or small. From taxis, Uber/Lyft, subways, commuter trains, parking and tolls, to rental cars, airfare, hotels, cruises, and tours, you’ll earn 2x points left and right.

There are a ton of options to redeem points, giving you the flexibility to use them how you want to.

When you have the Sapphire Preferred, there are a few different ways to use those Ultimate Rewards points.

The absolute easiest way to redeem your points is to exchange them for cash or gift cards at a rate of 1¢ each. That means that your 55,000 points are worth exactly $550.

A better option is to use them to book travel through the Chase Ultimate Rewards site, which works just like Expedia, Priceline, or any other major travel booking site. The reason that this option is better is that you’ll get a 25% bonus on your points. That means that 55,000 points will be worth 1.25¢ each, for a total of $687.50 towards flights, hotels, cruises, rental cars, or activities. If the thing you’re trying to book costs more than that, you can pay the difference in cash.

The final — and potentially most lucrative — way to use your points is to transfer them to one of Chase’s various travel partners’ frequent flyer programs. including nine airline frequent flyer programs and four hotel loyalty programs.

While this is more complicated, you can generally get more value by booking frequent flyer award tickets than you can by using your points as cash or through Chase. You can even book flights in business or first class for fewer points than it would cost if you used them as cash or through Chase’s website to buy the flights. For example, my wife and I used the points from our Sapphire Preferred cards to fly to Japan in first class for our honeymoon. You can read more about why transferable points are so valuable.

The Sapphire Preferred comes with useful travel and shopping benefits.

While they aren’t as flashy as points, bonuses, and fancy first class flights, the Sapphire Preferred offers various benefits and protections that can be just as lucrative.

One of the most valuable is primary rental car insurance. As long as you pay for a car rental with the Sapphire Preferred, you’ll be covered in the event of loss, damage, or theft. Just remember to decline the collision damage waiver from the rental agency. Because this is considered “primary” car insurance, the claim won’t be reported to your normal car insurance company, so your rates won’t be affected. Keep in mind that you may still want to consider opting for the rental agency’s liability insurance.

With the Sapphire Preferred’s primary rental insurance, you’re covered in the event of accidents, damage, theft, or loss. Maria Dryfhout/Shutterstock

The Sapphire Preferred also offers trip delay insurance for up to $500 per covered ticket. If your flight, train, or other “common carrier” transportation is delayed for more than 12 hours or overnight, anyone whose ticket was purchased with the card will be covered for up to $500 for a hotel room, clothes, toiletries, meals, and other incidentals. Remember to pay for covered expenses with your Sapphire Preferred. Then, save your receipts, and call the number on the back of the card as soon as you have a chance to start the claims process.

Similarly, the card offers baggage delay insurance. If an airline or common carrier loses or misdirects your bag, and it’s delayed getting to you, you’ll be covered for up to $100 per day for up to five days.

Trip cancellation/interruption insurance has you covered if you need to cancel a trip — or cut one short — for various covered reasons, including sickness, severe weather, and other situations. Coverage is for up to $10,000 for pre-paid and nonrefundable travel expenses, like flights or prepaid hotel rooms.

There are also a handful of purchase protections available, including purchase protection and extended warranty coverage, as well as price protection.

For many people, the Sapphire Preferred is a better option than the beefed-up Sapphire Reserve.

In 2016, Chase launched the Sapphire Reserve, a heftier version of the Preferred, which offers a ton of additional benefits, including 3x points on travel and dining.

However, the card carries a much higher annual fee — $450, compared to the Preferred’s $95 (which is waived the first year). While many people can get more than enough value from the heftier card to outweigh the annual fee, it still requires putting up $450 each year. Because of that, the Sapphire Preferred is a better option for anyone who balks at the idea of fronting that much money.

You can read more about the differences between the two cards here.

Bottom line.

The Sapphire Preferred is one of the best cards available for people getting into collecting points, miles, and credit card rewards. With a full suite of travel and purchase benefits, as well as a generous rewards program, the card offers enough value to make up for its annual fee (once the fee kicks in after your first year).

Click here to learn more about the Chase Sapphire Preferred card from Insider Picks’ partner The Points Guy.