If you are in the market for a rewards credit card, you’ve probably heard of the Capital One Venture Rewards Card and the Chase Sapphire® Preferred Card. Each has plenty of strong benefits to offer. However, as you probably don’t want to overload your wallet with plastic, you probably want to know which is better? Let’s find out!
The Chase Sapphire Preferred card comes with double the amount of bonus points that Capital One offers. With the Sapphire Preferred card, you’ll receive 40,000 bonus points if you spend at least $3,000 within the first three months. With Capital One’s offer, you’ll receive 10,000 bonus miles after spending at least $1,000 within the first three months.
Basically, if you intend to spend at least $3,000 over three months – something that most people do – then Chase offers a must better upfront bonus.
After the exhilaration of having all those bonus points (or miles) subsides, it is important to have a card that offers rewards for each purchase that you make. Each of these cards does so, so you won’t lose any sleep in this regard.
With the Chase Sapphire Preferred card, you’ll earn two points per dollar spent on travel and dining. You’ll also be eligible for up to 10 points per dollar spent in the Ultimate Rewards Mall. All other purchases qualify for one point per dollar spent, so you’ll always walk away with something.
Of important note is that your points will be worth 25 percent more when redeeming them for travel through the Ultimate Rewards program. For example, a flight that typically costs $500 will cost $400 when booked in this fashion. Also, a seven percent points dividend is offered annually on all points that you earn, so it effectively makes the minimum points per dollar one dollar and seven cents.
With the Capital One Venture Rewards card, you’ll earn up to 15 miles per dollar spent though the Perks Central Retail Network. All other purchases are good for two miles per dollar spent.
So, in terms of purchase rewards, most people will do better with Capital One’s offer, as they’ll get at least two miles per dollar spent (versus 1.07 points with Chase’s offer).
While points or miles are the face of most rewards programs, there are other benefits that can add significant value to a credit card.
With the Chase Sapphire Preferred card, you’ll be able to transfer your points at a 1-to-1 ratio to various frequent flyer programs. Effectively, this card doubles as a miles card for such programs. This is a benefit that is not found on most other cards, so you’ll have this advantage while using this card.
The Capital One Venture Rewards card offers many of the same benefits that you’ll find on plenty of other cards. These include fraud protection, auto rental insurance, roadside assistance and other common perks.
In a nutshell, Chase wins out in terms of other benefits because of the ability to transfer your points at a 1-to-1 ratio to frequent flyer programs. Yes, this is technically a points benefit, but it is more of a side-perk that is not offered with most other cards, not a way to earn points.
Let’s take a look at how each card could work for you.
Suppose that you will spend $50,000 in your first year with either card using the following breakdown:
- $5,000 on travel
- $5,000 on dining
- $5,000 on other purchases through the issuer’s network (at the middle of the possible points rewards – ex: 5 points per dollar spent with Chase, which offers 1 to 10 through the Ultimate Rewards Mall)
- $35,000 on all other purchases
Also, let’s ignore the annual fee, as we are focusing on the first year with each card. Finally, let’s give 2.25 points per dollar spent on travel with the Chase Sapphire Preferred card, as that’s the effective value when booking it through the Ultimate Rewards program.
Here is out it would play out:
|Card||Bonus Points/Miles||Purchase Points/Miles||Total Points/Miles||Total Value|
|Chase Sapphire® Preferred Card||40,000||82,500||122,500||$1,225|
|Capital One Venture Rewards||10,000||127,500||137,500||$1,375|
Now, let’s see how this would play out during the second year, using the same assumptions. Note that the total value takes the annual fee into consideration, as you’ll have to pay that fee after the first year.
|Card||Annual Fee||Purchase Points/Miles||Total Points/Miles||Total Value|
|Chase Sapphire® Preferred Card||$95||82,500||82,500||$730|
|Capital One Venture Rewards||$59||127,500||127,500||$1,216|
So, given this example, you could expect to earn $200 more in rewards with the Capital One Venture Rewards Card after the first year. That’s significantly more money for your troubles.
From year two (and on), the gap widens. In this example, you would receive an additional $486 in rewards by choosing the Capital One Venture Rewards card over the Chase Sapphire Preferred card. That’s a month or more worth of groceries for some households – not a bad deal at all.
So, while you’ll be able to use the Chase Sapphire Preferred card as a frequent flyer card in many cases, the Capital One Venture Rewards card offers more value to the average person. By using it, you’ll likely receive hundreds of dollars in extra rewards that you wouldn’t get with the Sapphire Preferred card. Will this card be in your wallet?
Credit RequiredExcellent Credit
Rewards ProgramEarn 1 point per dollar spent, 2x points on dining and travel. Earn a 7% annual points dividend.
Signup Bonus$500 in Free Airfare40,000 bonus points after you spend $3,000 in the first 3 months.