I originally published this post a couple weeks ago but have updated it today (8/16/16) to reflect the latest news.
There were rumors flying around the internet about a new premium travel credit card to be released by Chase on August 21, 2016 called the Sapphire Reserve. The rumors now look to be confirmed.
Doctor of Credit has published screenshots of what bankers have already been told about the new card. Frequent Miler also said his own banker confirmed existence of the Sapphire Reserve. Then yesterday, The Points Guy reported that Chase confirmed it with them directly (and Chase officially tweeted it).
Here’s the sign up offer.
- $450 Annual Fee
- 100K Ultimate Rewards Sign-up Bonus for spending $4,000 within three months of opening the card
- $300.00 Annual Airline Credit
- Access to 900+ lounges worldwide (Priority Pass Select)
- Redeem Ultimate Rewards directly on airfare (any airlines) for a value of 1.5 cents each
- 3X Points Travel
- 3X Points Dining (Yes, 3X for Dining!)
- $100 Global Entry Free credit
- Visa Infinite
A move like this from Chase makes a lot of sense from a competitive standpoint. Chase is the only big issuing bank that doesn’t have a premium credit card. By premium, I mean a card with a large annual fee that is (depending on the type of traveler and spender you are) often justified by large benefits, like:
- The Platinum Card® from American Express Read how to get the most out of your American Express Platinum cards.
How the Rumored Sapphire Reserve Stacks Up to the Competition
The annual fee projection is the standard $450 that other premium cards charge, so no surprise there.
The minimum spending requirement is $4,000 for the massive 100k Ultimate Reward sign-up bonus, which is also on par with the competition. It goes without saying that the sign-up bonus is competitive. We value Ultimate Rewards at 2 cents each which would make that bonus worth a staggering $2,000. How long that inflated sign-up bonus will last until they match the going market rate is up for debate, but I can’t see it lasting for too long when the Citi Prestige® Card and Amex Platinum cards offer 40k to 50k bonuses in their own point currencies.
The Airline Credits are competitively higher ($100 higher than Amex’s, and $50 higher than Citi’s). More on that below.
Priority Pass Select membership grants access to over 900 lounges worldwide and is a standard premium card benefit.
A direct redemption rate on all airlines of 1.5 cents per Ultimate Reward is one of the most competitive aspects of the Reserve’s offer. The Prestige offers a less valuable rate for redeeming ThankYou Points directly (1.33 cents with the current offer, and that changes to 1.25 cents as of July 23, 2017). Membership Rewards earned from the Platinum cards have a direct redemption rate of a meager 1 cent each.
A 3x category bonus for spend on travel is good– same as the Prestige’s and better than Amex’s premium cards.
A 3x category bonus on dining is exceptional and perhaps the most standout item on the benefit list, at least from a long term perspective. No other directly competitive card offers 3x for dining.
You can get up to $100 reimbursed on your card statement for the Global Entry Fee or TSA Pre✓® . This is a standard benefit offered by premium credit cards, so again, Chase is right on par with the competition in this aspect.
The Visa Infinite program’s benefits are all luxury travel related. Doctor of Credit describes them in detail here. No other premium card is a part of the Visa Infinite program, but the Prestige offers the fourth hotel night free benefit and the Amex Platinum grants Hilton Gold status.
$600 in Airline Credit Before 2nd Annual Fee = $150 in free Airline Credit
Assuming the Airline Credit would be available on a calendar year basis (like the Citi Prestige), then the annual fee would be more than made up for in the first year of card membership because you could get $600 in Airline Credit before the second annual fee hits.
For example, if you signed up for the Sapphire Reserve in October 2016, you’d have until the end of December 2016 to use the first calendar year’s $300 credit. Then between January 2017 and October 2017 you’d have another $300 credit to spend before the annual fee hits for the second year of card membership.
That means you’d come out $150 on top (in airline credits) before the second annual fee is collected after subtracting the first annual fee from the total amount of airline credit you can earn in a year of card membership:
($600 Airline Credit – $450 Annual Fee = $150 free Airline Credit)
Of course, if you don’t spend that much on cash tickets for flights/award taxes & fees/in-flight purchases/airline gift cards/etc, then you probably shouldn’t even be considering a premium card like this, as that is what mainly justifies paying at least one annual fee.
Remember, This is a Chase Card
Will the Chase 5/24 rule apply to this rumored premium card? Well, we thought so.
But there were early application links floating around yesterday (now dead), and Interestingly, this reddit.com/r/churning survey has data points from people that applied. The majority of applicants were over the 5/24 limit, and of those people, the majority were approved anyway.
Rumor had it that Chase is set to release a premium travel credit card called the Sapphire Reserve on August 21, and we now have all the reason needed to believe those rumors as true. It will be Chase’s first premium travel credit card and will compete with the likes of the Citi Prestige® Card and the Platinum Card® from American Express.
Chase’s existing Sapphire Preferred card is consistently on our Top 10 list of best travel credit cards. It comes with 55,000 Ultimate Rewards after a $4,000 minimum spending requirement and adding one authorized user, as well as 2x category bonuses on travel and dining expenses.
The Sapphire Reserve will undoubtedly make the Top 10 cut as the Sapphire Preferred’s sexier older sister.