This is fun! Right on the heels of Citibank’s announced devaluation of their high-end Citi Prestige card, comes the rumored release of a new high-end competitor:: Chase Sapphire Reserve. There has already been a lot of ink spilled over this rumored card, but I haven’t yet seen anyone else ask the $1200 question…
So far, most of what we think we know comes from mvcore on Flyertalk who reports the following details:
- 100K Ultimate Rewards Signup Bonus
- $450 Annual Fee
- $300 Airline Credit
- Priority Pass Select
- 3X Points Travel & Dining
- Visa Infinite
And Doctor of Credit mentions an “unnamed reader” who said that the card would be launched on August 21.
If this is all true, a 100K signup offer from Chase will be big news. If you can get around Chase’s 5/24 rules, or fly under them, and unless the minimum spend requirements are extraordinary, the card will be a great deal.. at least for the first year. Whether or not it will be worth keeping past the first year will depend upon the answers to a number of unknowns, including details about that $300 Airline Credit.
There’s good reason to be suspicious of this rumor. Do you remember the 100K signup offer for the CNB Crystal Visa Infinite card from last October? The details of the offer were startlingly similar:
|Chase Sapphire Reserve
|Airline Fee Credit||$250||$300|
|Lounge Access||Priority Pass Select||Priority Pass Select|
|Bonus Categories||3X Travel & Dining*||3X Travel & Dining|
|Credit Card Type||Visa Infinite||Visa Infinite|
* The CNB website advertised 3X for Travel & Dining, but after getting the card I discovered that it actually offered 3X for gas and groceries in addition to travel and dining!
The only difference between the old advertised CNB card offer and the rumored Sapphire Reserve offer is that the Chase card would cost $50 more and would make up for that by offering $50 more in airline fee credits. And, of course, the points earned from Chase’s card would be much more valuable Ultimate Rewards points.
The similarity here could mean that a hoaxster simply copied the old CNB offer and modified it slightly to make it look new. Or, it could mean that Chase worked with the same Visa Infinite team that setup the CNB card and were influenced by what they had done before.
Most likely, in my opinion, the similarity is a coincidence. “100K” is a big round number that attracts attention so it’s natural to offer this for a new high-end card. And $450 has become the standard price point for cards like these (Citi Prestige, and Amex Platinum, for example). And, cards in this category all offer Priority Pass Select airport lounge membership. So, the only real surprises are the Visa Infinite designation and the apparent similarity in the 3X bonus structure. The latter probably came about simply because Chase wanted to literally one-up their own Sapphire Preferred card which offers 2X for travel and dining.
The $300 question
If the card is real (and I’m betting that it is), we will soon learn more details about its perks. Only then will we know if the card is worth its price after the first year. But, what is its price? $450 per year, right? But there’s the $300 Airline Credit… isn’t that effectively a $300 rebate off the annual fee? To me, it depends on how easy it is to get that rebate.
Chase currently has another premium card with a $300 airline fee credit: the Ritz Carlton Rewards Visa. With that card, you have to contact Chase after incurring a qualifying fee in order to request your rebate. That’s not the end of the world, but it would be easy to forget or to simply not want to bother. And I imagine that’s what Chase counts on.
Meanwhile, the $200 per card airline fee rebate offered by the CNB Crystal Infinite card is managed automatically by Visa. When airline fees are charged to the card, they are automatically rebated. The process is far from perfect: in my experience, some charges that should have been rebated were not, whereas charges that are supposedly excluded such as gift cards and award ticket fees were rebated.
Thanks to booking awards for myself and family members it has been easy to rack up hundreds of dollars in rebates over the course of a year. So, for someone like me, the Sapphire Reserve $300 airline credit would effectively reduce the annual fee to just $150. If I had to contact Chase to request a rebate for every little $5.60 TSA charge, though, the $300 credit may seem more trouble than it is worth.
The value of the $300 airline credit, then, will be determined both by the way the credit is processed (which we don’t yet know) and by the individual (how likely they are to get full value from the credit).
The $1200 question
Another interesting detail about the similar CNB Crystal Visa Infinite card is that authorized users each get up to $250 per calendar year in airline fee credits. And CNB lets cardholders add up to 3 authorized users for free. For one $400 annual fee, its possible to get $1,000 in airline fee rebates per year.
Will Chase do something similar? Will Chase allow up to $300 per year in airline fee credits for up to four cards, for a total of up to $1,200? Most likely not. They could copy the Amex Platinum and Citi Prestige approach and only allow airline fee credits for primary cardholders. Or, they could charge a large fee for each authorized user. On the other hand… the similarities between the CNB card and the rumored Chase card are hard to ignore. It’s obviously a long shot, but I’m certainly hoping that the authorized user cards will be handled the same way.
The 3X Bonus question
The CNB card advertised 3X for travel and dining, but I found that it actually offered 3X not just for those categories, but for gas and groceries as well. Is it possible that Chase will do the same? If so, that would be really awesome, and would go a long way towards justifying the card’s high price. But… they won’t. I’m positive that Chase will stick to 3X just for travel and dining. Unlike the travel fee rebate, which might be administered by Visa, the bonus points will certainly be administered by Chase. So, there’s no reason to expect the Chase card to match the CNB card in this respect.
Other likely CNB-ish benefits
While $1200 in airline fee credits is unlikely, and 3X gas and grocery is a pipe dream, the CNB card has a few great benefits that I think are very likely to be found on the Chase Sapphire Reserve card:
Global Entry Application Fee Rebate: This has become a standard perk of all of the high end cards. I’m sure Chase’s card will offer this too.
Free In-Flight Gogo Wifi: With CNB’s card you get 12 Gogo Inflight Wi-Fi passes per year. Each pass can be used for a single flight segment. This is a great perk, but it’s worth mentioning that you can get the same exact perk from the $49 per year US Banks FlexPerks Visa. Still, if Chase offers this, it’s unquestionably a valuable benefit for those who fly regularly.
Discount Air Benefit: Save $100 on each 2 (or more) person round trip domestic flight purchased through this website. We reported this feature previously, here: Bet You Didn’t Know: A Repeatable Companion Airfare Discount with the CNB Crystal Visa Infinite. I used this feature for the first time recently when I bought three round trip JetBlue tickets in order to qualify for JetBlue’s big Points Match Promo, and I really did save $100 off the best price available elsewhere. Note that this is a $100 savings in total, not per person.
More analysis and guesswork
One of the things that intrigues me most about the Chase Sapphire Reserve card is that it will be the first time that a major card issuer offers best-in-class point earnings on a high end card. The $450 Amex Platinum card, for example, earns just 1 Membership Rewards point per dollar in any category. Meanwhile, their $95 Everyday Preferred card earns up to 3 points per dollar for gas and up to 4.5 points per dollar for groceries. In other words, Amex rewards Everyday Preferred customers for using the card whereas Amex rewards Platinum cardholders (in the form of perks) for having the card. With Citi, the contrast isn’t as stark, but it is still the case that Citi’s $95 Premier card offers better 3X categories than their $450 Prestige card. With Chase, if the rumors are true, the new card will offer the best travel and dining spend bonuses across their entire portfolio. To me, that just makes sense. Those willing to spend more for a card ought to be rewarded more for using it.
One perk that I think is possible, but wasn’t mentioned in any of the rumors about the card, is that Chase may make points worth more when used to purchase travel. Citi currently does this with the Prestige card (where points are worth either 1.33 or 1.6 cents each towards flights vs. the less expensive Premier in which points are worth 1.25 cents each for travel), but has announced that they will back off that advantage next July. And Amex does this with their Business Platinum card where they offer a 30% point rebate when points are used to purchase flights on a designated airline. A very welcome perk would be if the Chase Sapphire Reserve were to offer 1.5 cents per point value for travel. For Chase customers, that would further distance the card from the Sapphire Preferred (for those wondering if the card is really worth the extra cost), and it would give Prestige and Business Platinum cardholders the sense that switching would not be much of a loss.
I’ll almost certainly try to get the card if it really has a 100K Ultimate Rewards signup bonus. Then, depending upon the card’s specific perks, and the answers to the $300 and $1200 questions, I may even keep it long term. If they do it right, this card has potential to be the single best travel card available. But, they’ll have to offer more than just the perks we know of so far to make it worth that ongoing premium.
How about you? Will you likely sign up for the card? Or, if Chase’s 5/24 Rule prevents you from signing up new, what features would entice you to product change from another card? Please comment below.