Premium Travel Cards Pivot Benefits in a Coronavirus World: Update

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Updated 6/9/20 with Citi’s latest addition to the Prestige Card.

In an attempt to keep you as a customer in a world where travel is severely limited, banks have been changing the benefit profiles of their credit cards that previously rewarded behavior centered primarily around travel.

Those of you most concerned with what to do with your travel cards are likely paying big annual fees for the premium transferrable point cards–the Chase Sapphire Reserve, The Platinum Card from American Express, and the Citi Prestige–so let’s compare those changes.

Premium Transferable Point Credit Cards New Pandemic-Centric Benefits

Amex

It’s going to be easy for the vast majority to earn back $360 (16 x $20) of their $550 annual fee with $20 back per moth, May through December, on streaming services and cell phone bills. The statement credits will be applied automatically so you don’t have to do anything to earn them. Even if those who haven’t used or don’t end up using the standard $200 incidental fee credit will pay an effective annual fee of $190.

It will be interesting to see how widespread the $200 statement credit on purchases made through Amex Travel turns out to be. This will also be harder to take advantage of for many who still feel uncomfortable traveling, but for some it will prove lucrative. Let us know in the comments if you were/are targeted and how that affected your decision to renew or not.

Don’t forget to take advantage of…

…the Platinum’s $100 per year Saks Fifth Avenue statement credit.

You get a $50 statement credit January – June, and another July – December. This non travel-oriented benefit was available before the pandemic and should be an easy way to continue to squeeze value out of your Platinum card.

Chase

I think one of the most interesting offers, announced by Chase last week, is the ability to redeem Ultimate Rewards earned by the Chase Sapphire Reserve at a value of 1.5 cents towards groceries, restaurants, and home improvement purchases.

That redemption value was previously reserved for using Ultimate Rewards to book travel through Chase’s travel portal. At this point I wouldn’t redeem my points this way, as I can easily get two cents or more of value per point transferring my Ultimate Rewards to airline partners. That being said, I don’t have any plans right now to fly–as many don’t–so having the option to liquidate points could prove helpful to my and many people’s cash flow. Not to mention there are plenty of people who don’t know how to take advantage of transferring points out to airline partners, so for these people redeeming their points at 1.5 cents on food and home improvements is equally as good as the redemption value they’d typically get.

If you have any of Chase’s cash back cards–a Chase Freedom Unlimited, Freedom, Ink Business Unlimited, or Ink Business Cash–you can also move those points to your Chase Sapphire Reserve and from there redeem them for 1.5 cents towards groceries, restaurants, and home improvement. That’s much better than the 1 cent you’d get redeeming straight from the cash back card. Of course, you also have the option to transfer them out to airline or hotel loyalty programs via the Chase Sapphire Reserve instead.

Making sure people get full use of the Chase Sapphire Reserve’s $300 travel credit by allowing grocery and gas purchases to count will no doubt bring the vast majority’s effective annual fee from $550 to $250. And everyone renewing April through the end of the year got/gets $100 knocked off their annual fee whether that was a $100 statement credit earlier this year or $450 charged outright instead of $550 later this year (this will apply for renewals July 1 through December). That means the pandemic effective annual fee is $150, before consideration of the extra Ultimate Rewards you’ll earn for 5x on groceries and the added value of being able to redeem points for 1.5 cents on groceries, restaurants, and home improvement purchases.

Don’t forget to take advantage of…

…the Chase Sapphire Reserve’s Door Dash credits.

Back in January the Sapphire Reserve’s annual fee was raised to $550, and to soften the blow Chase added $60 in Door Dash credits in 2020 as well as 2021. If you haven’t already, make sure to charge $60 worth of food to your card to cash in on this benefit. Door Dash credit was’t added for the pandemic but it certainly fits the current climate and is easy to cash in on. Don’t live in an area served by Door Dash? Let a trusted family member or friend that does have Door Dash access use your card number for a meal and get them to reimburse you.

Citi

The Citi Prestige comes with a $250 travel statement credit, which will be easy for customers to take full advantage of since grocery and restaurant purchases will now also be credited until the $250 maximum is met. Citi hasn’t offered any other significant new incentives though. That brings the pandemic effective annual fee down to $245.

That being said, the Prestige already offers the most competitive category bonus for restaurant spending at 5 ThankYou Points per dollar. So if you’re ordering a lot of takeout then perhaps you’re finding added value there.

Update 6/9/2020: Citi is now awarding 5 ThankYou Points per dollar spent on online retailer, grocery, and drugstore orders. After $1,500 spent in those categories, you will max out on potential bonus points (so 7,5000 ThankYou bonus points are available total). That’s an improvement, but I still don’t see Citi’s offer as being as lucrative as Amex or Chase’s.

Don’t forget to take advantage of…

…cell phone protection. If you pay your cell phone bill with your Prestige you get $1,000 of coverage per claim, as well as up to $1,500 per 12 month period for the damage and or theft of up to five cell phones. Note that each claim will have a $50 deductible.

While I think it’s less likely for your phone to get stolen right now, it’s just as easy to damage. There’s no need to keep paying monthly insurance with your carrier if you have a Prestige.

Bottom Line

I think Chase and Amex are doing a good job in making sure the value propositions stay high enough for their Chase Sapphire Reserve and Amex Platinum customers. Citi, I’m not sure about your Prestige customers. In comparison, you’re looking a little cheap.

The next annual fee on my Sapphire Reserve is charged in April of 2021, so I don’t have any decisions to make for now. For those with impending annual fees: Are these new perks good enough for you?