By now, you would be aware that the Chase 5/24 rule has been extended to each of the Chase personal credit cards, including it’s co-branded cards.
In August 2018, Chase changed the sign-up bonus eligibility criteria for its Sapphire series of cards. Traditionally, you would be eligible for a new sign-up bonus on a Sapphire card after 24-month from your last Sapphire bonus. The Conventional path was something like this –
Now, the current language states that one can only get a sign-up bonus for the Sapphire line of cards after 48 months from receipt of the first sign-up bonus. For most people in the hobby, 4 years is a long time to hold Ultimate Rewards without using them, since any form of points and miles almost always depreciate. We are also assuming that within these 4 years, you have become seasoned at the points and miles game and understand that the Sapphire Reserve card is something you cannot not have!
So, with the new sign-up bonus rules in place, I adopted a lesser known, counter-intuitive approach –
While the obvious difference is the missed sign-up bonus on the second card, I see it differently here; Chase would have only allowed me to get one sign-up bonus in 4 years. How would I maximize the value at the least cost?
First, I started out with the Chase Sapphire Preferred, which helped me accumulate 50,000 sign-up bonus points, same as the Sapphire Reserve, but without any annual fee in the first year. I decided to get my account seasoned, deep dive into the hobby, understand the benefits of the CSP vs. CSR, and then when the annual fee hit for the second year, I simply upgraded my credit card from the Preferred to the Reserve.
So, same sign-up bonus, avoided annual fees for the first year, and landed in a better position to redeem all the accumulated Ultimate Rewards, albeit at a higher redemption rate of 1.5x (CSP redemption is at 1.25x). You also save end up saving a very important slot in the 5/24 rule since you are not applying for a new card. This becomes even more important now that Chase has started considering most of its personal credit cards under 5/24.
So if you try to redeem your Sign-Up bonus via the Chase Ultimate Rewards Portal, here is how it looks with the two cards –
By following my strategy, you will be able to save annual fees in the first year, and then hop on to a card which offers incredible premium benefits for an effective annual fee of $150 (after the $300 travel credit), or just $50 once every 4 years, if you choose to enroll for the Global Entry program and pay the fees using the Chase Sapphire Reserve.
Let me provide a more realistic view – If you are like me, casually trying to accumulate points and have only been in the hobby for a year or so, or are just starting out and intending to slowly build up your Ultimate Rewards points, here is how your points would look at the end of the year –
The Sapphire Reserve (image, above) truly shines with a little over the 200,000 UR’s in my possession. After upgrading to the Reserve yesterday, here’s my redemption calculation –
Yes, this simple upgrade increases the value of my points to more than the Annual Fees of this card, and it also offers me Priority Pass access (one trip a year is also worth it) and many more benefits!
Not Convinced Yet?
What are the factors holding you back from getting a Sapphire Reserve?