What to do with your Chase Sapphire Preferred® Card

For several years, the Chase Sapphire Preferred® Card was one of the best travel reward credit cards. It offers $50 annual Ultimate Rewards Hotel Credit, 5X points on travel purchased through Chase Travel℠, 3x on dining and 2x on all other travel purchases, plus more. With Chase Sapphire Preferred®, you can transfer your points to leading frequent travel programs at 1 to 1 value. Points can be transferred to ten airline travel partners or three hotel travel partners. You can also redeem points for 1.25 cents each towards travel reservations made through Chase.

In 2016, Chase’s Sapphire Reserve® card was introduced. It offers 5x on travel purchased through Chase Travel℠, 3x on dining, and 2x on all other travel purchases, and $50 Annual Chase Travel Hotel Credit, plus more. It also offers 25% more value when you redeem for airfare, hotels, car rentals and cruises through Chase Travel℠. For example, 60,000 points are worth $900 toward travel.

Not only did the Chase Sapphire Reserve® overtake the Chase Sapphire Preferred® Card, but it also became one of the most sought-after credit cards ever introduced. For a while, Chase even had trouble printing enough of them. Yet those who have received a Chase Sapphire Reserve® were often left wondering what do with their old Chase Sapphire Preferred® card.

Chase Sapphire Preferred® Card vs. Chase Sapphire Reserve®

Often, a new credit card will provide benefits that complement existing offerings. For example, if a new Chase card offered bonus points for entertainment and grocery store purchases, then it might make sense for some to hold this card and keep their Sapphire Preferred®. But the benefits of the Sapphire Reserve® completely equaled or surpassed those of the Sapphire Preferred®. For instance, the Sapphire Reserve® offers triple points where the Preferred® only offers double points. And every cardholder benefit offered to Preferred® cardholders is granted to Reserve® cardholders, and more.

The Three Choices

If you hold both the Sapphire Reserve® and the Sapphire Preferred®, then you are left with three choices:

Option 1. Keep the Sapphire Preferred®. There are few logical reasons to keep this card if you already have the Sapphire Reserve®. One reason is to continue to build your credit by having more credit extended and another account on your credit report. But with a $95 annual fee, this is an expensive way to build credit.

Option 2: Cancel the Sapphire Preferred® Card. This seems like the obvious choice for many cardholders when they realize that the Sapphire Preferred® card’s benefits are completely redundant to the Sapphire Reserve®. The advantages of this strategy is that you’ll save the $95 annual fee, and have one less card to worry about. On the other hand, you will be reducing your credit extended and you’ll have one less account adding to your credit history. For those with a shorter credit history, or with very few credit cards, this could have a small, negative effect on your credit score.

Option 3: Request a product change. A product change is where a card issuer keeps your account open, but changes the type of card associated with it. And when you product change your Sapphire Preferred® to a card without an annual fee, you can save $95 while keeping your account open and on your credit report. In addition, you can also enjoy the complementary advantages of another Chase credit card.

For example, you could perform a product change to the Chase Freedom® card, which offers 5% cash back on up to $1,500 spent each quarter at merchants in featured categories, and 1% cash back on all other purchases. You could also choose to the Chase Freedom Unlimited®, which features unlimited 1.5% cash back on all purchases. Neither of these cards have an annual fee.

With the Chase Freedom Unlimited®, after your first year or $20,000 spent, enjoy 5% cash back on Chase travel purchased through Chase Travel, 3% cash back on drugstore purchases and dining at restaurants, including takeout and eligible delivery service, and unlimited 1.5% cash back on all other purchases. If you choose the standard Chase Freedom® card, you earn 5% on travel purchased through Chase and 3% on dining at restaurants and drugstores. These Chase Freedom Unlimited® and Chase Freedom® card benefits seem better than having to pay $95 for the redundant benefits of the Sapphire Reserve®.

Bottom Line

It’s always a good problem to have when your credit card has been replaced with a better one, but you still need to figure out what to do with your old card. By understanding all of your options, you can choose the best one for you needs.