Chase Ultimate Rewards: We Breakdown How They Work

The Ultimate Rewards program from Chase can be one of the most flexible rewards programs in the business if you know how to maximize your point value. And after reading through this guide, you'll know exactly how to do that. So whether you're looking for a travel, business, or just a great all-around cashback card, Chase has several options that will all let you start earnings Ultimate Rewards.

With Chase, you can select from business or personal card options both of which are part of the Ultimate Rewards program. We'll get into more details below, but you should know that the no-fee card offerings are generally inferior to their annual-fee counterparts, and as such, we recommend applying for the fee-cards in most cases.

What are Chase Ultimate Rewards worth?

For most cards, the value of Ultimate Rewards points is simple. They're worth 1 cent per point when used towards cash back, travel expenses and other items. Things can get a little more complicated with some of the cards in this program, since as they offer additional ways to spend the points that can net you a better value. The fee-based cards give you a 20% discount when redeeming points for travel, making the Ultimate Rewards points worth 1.25 cents per point. Even better yet, with Chase Sapphire Preferred you can transfer your rewards to partner loyalty programs where they can be worth significantly more.

Knowing the value of each point is only half of the equation. Rewards rates among the available cards varies, with many cards offering higher rewards in particular spending categories. Among the standouts are the rewards for the Chase Sapphire Preferred, where you earn 2 points on all restaurant and travel spending and 3 points when booking travel through Chase. Depending on your spending patterns and how you like to shop for travel, Chase Ultimate Rewards offers the potential for signficant savings on your spending.

The Chase Sapphire Preferred: The Only Personal Card Worth Looking At

Among all the cards under the Chase Ultimate Rewards banner, the Chase Sapphire Preferred is the clear cut leader. For the $95 annual fee (waived for the first year), the Preferred increases the value of your rewards significantly. By opening up the travel redemption discount, and airline transfer program the card gives savvy travel shoppers multiple ways to amplify their rewards rate. The card's larger signing bonus which awards you with 40,000 points is worth at least $400 dollars ($300 more than the no fee version) means the card practically pays for itself for 3 years. 

The beauty of Chase Ultimate Rewards that it balances flexible redemption options, with the opportunity for getting more value of your rewards. For shoppers willing to do a little more research and maximize their reward redemption, the Sapphire Preferred is the best way to achieve the best of both these worlds. The card's annual 7% dividend on all points earned and redeemed is a small added bonus as well.

Other rewards programs to consider

There are programs that can offer higher rewards and some that offer greater flexibility. For consumers that just want a card that is easy to use, and has few restrictions to consider, the Barclays Arrival Plus World Elite Mastercard is a great option. With a 2.2% rewards rate on all spending categories, cardholders can simply spend and redeem their rewards as statement credits towards any travel purchase. It's an simpler option for those consumers that may prioritize flexibility and ease of use.

For rewards maximizers affiliated loyalty programs are the way to go.

Starwood Preferred Guest

Unlike Chase Ultimate Rewards the Starwood Preferred Guest (SPG) program is focused on hotel stays. Like most loyalty rewards Starpoints will vary in their value but on average are worth an astounding 2.3 cents per point whend used towards hotel stays. This is among the highest value per reward out of any program. The tradeoff is that you are limited to Starwood affiliated hotels and locations. One benefit of the SPG program, is that like Chase's Ultimate Rewards, members can transfer their Starpoints to most major carriers. These transfer partnerships include many US airlines that are not included in Chase's program. Airlines include American, Delta, US Airways, Virgin America and many others.

Starwood Preferred Guest Credit Card

This American Express offering costs $65 per year (waived the first year), less than both the other cards we've looked at. A must-have for travelers who know they'll be staying in Starwood-owned hotels (full list below). The card is less valuable if you place a premium on airline and lodging flexibility when you travel.

In-Depth Review

What You Need to Know About Chase Ultimate Rewards

The first thing you'll want to know about Chase's rewards program is that there are two separate tiers in which your credit card can fall. Tier one includes the Chase Freedom, Chase Sapphire, and Chase Ink Cash cards. This tier of rewards cards pales in comparison to the second tier which we'll tell you about shortly. Basically, what we're calling the 'tier one' cards allow cardholders to redeem their rewards at a less attractive, one cent per point, redemption rate. What these 3 cards do have going for them though is that they're all no-fee cards so you'll be saving $95 a year over the 'tier two' card options. 

Chase's primary 'tier two' Ultimate Rewards cards are as follows: Chase Sapphire Preferred, Chase Ink Bold, and Chase Ink Plus. This selection of cards will all set you back $95 for their annual fee, but most importantly they earn (at minimum) 1.25 cents per point, or 25% more than their tier-one counterparts.

These 'tier-two' cards also come with an additional option that make them all the more enticing. They allow cardholders the option to transfer their Ultimate Rewards points at a rate of 1:1 to a handful of travel partners giving you a ton of flexbillity in where you spend your points and how much value you get for them.

The current Ultimate Rewards Travel partners are: 

  • British Airways Executive Club
  • Korean Air SKYPASS
  • Southwest Airlines Rapid Rewards
  • United MileagePlus
  • Virgin Atlantic Flying Club
  • Amtrak Guest Rewards
  • Hyatt Gold Passport
  • Marriott Rewards
  • IHG Rewards Club

ValuePenguin has also built an easy to use tool that can help you determine which card is best for your particular situation. Click on "Model Input" to tell us more about your spending habits and we'll show you what card we think is best.

Rewards
Graph by Card:
Rewards
The total value of the card at the end of the period by card. The card value accounts for the dollar value of the rewards as well as any fees associated with the card.
Rewards Rate
The dollar value of rewards as a percentage of total spending by card.
APR
The minimum APR for each card.
Annual Fee
The annual fee for each card.
Bonus Value
The dollar value of signing and continuing bonuses by card.
Graph by Month:
Rewards
The dollar value of each card by month
Rewards Rate
The value of each card as a percentage of total spending by month…
Based on a cardholder that spends $1000 a month, over 2 years

Chase Ultimate Rewards Personal Credit Card Comparison

In the table below we breakdown the differences between all three Chase Ultimate Rewards cards designated for personal use. The Chase Freedom is a cashback card while both the Sapphire and Sapphire Preferred are primarily travel cards:

  Freedom Sapphire Sapphire Preferred
 
Image ofChase Freedom® Credit Card
Image ofChase Sapphire Preferred® Credit Card
Image ofChase Sapphire® Credit Card
Signup Promo $100 10,000 points 40,000 points
Annual Fee $0 $0 $95
Min APR 13.99% 15.99% 15.99%
Foreign Trans Fee 3% 3%  0%
Annual Points Dividend 10% 0% 7%
Earnings Rate

5% cash back on rotating categories

1% unlimited on everything else

2 points per $1 spent on restaurants

2 points per $1 on travel (booked through Chase)

1 point on everything else

2 points per $1 spent on restaurants and all travel

3 points per $1 on travel (booked through Chase)

1 point on everything else

 

Chase Ultimate Rewards Business Credit Card Comparison

In this comparison snapshot you can get a quick look at the differences between all three Chase Ultimate Rewards cards designated for business owners use. The Ink Cash is a cashback card while both the Ink Bold and Ink Plus are more general business rewards cards:

  Ink Cash Ink Bold Ink Plus
Signup Promo $300 60,000 points 60,000 points 
Rewards 5% cash back on up to $25,000 in business services  5 points per $1 spent on up to $50,000 in business services  5 points per $1 spent on up to $50,000 of business services  
  2% cash back on up $25,000 gas stations and restaurants 2 points per $1 spent on up to $50k of gas stations and hotels  2 points per $1 spent on up to $50k of gas stations and hotels 
  1% on everything else  1 point on everything else   1 point on everything else 
Fee $0  $95 $95
Min APR 13.24%  3.25% (charge card) 15.24% 
FX Fee 3%  0% 0% 

*Business services include office supply stores, cell phones, landline phones, internet, and cable tv services

The Best Way to Spend Your Ultimate Rewards

Assuming you're using one of the above mentioned 'Tier-2' credit cards, redeeming points through Chase's travel partners is really the best way to get the greatest bang for your buck. While you're guaranteed at least a 1.25 cent per point redemption when booking through Chase Travel, your redemption rate through the travel partners will vary so you'll need to be on the lookout. Of course if you're using a 'Tier-1' Ultimate Rewards card, you'll be locked into getting a 1 cent on the dollar redemption rate.

We went ahead and priced out some different options for a handful of the travel partners at different times of the year. Here are some example of the wide-ranging redemption variability you can expect (cents per points value is in bold):

British Airways

Pricing a mid-February flight from NYC to London that was booked within a week of the trip, we found it cost $1,602 roundtrip. That same trip would cost 40,000 Avios (British Airways miles) meaning that each point is this scenario is worth 4.0 cents. This is 320% more than the standard 1.25 cents per point if you redeem through Chase Travel.

Southwest Airlines

A flight booked on Southwest during a 3-day holiday weekend from Los Angeles to Ft. Lauderdale was priced at $400 even. This particular roundtrip flight also cost 17,000 Southwest points to redeem. The conversion value: 2.4 cents per point.

Marriott Rewards

A room reserved in a midwestern, metro-area for one night in April was priced at $137 per night. That same room could be reserved using 7,500 Marriott Hotel points: a value of 1.82 cents per point.

Hyatt Gold Passport

If you were looking to book room over the weekend in New Orleans (during March) it would set you back $269 per night. If you decided to pay for that room with your Hyatt points it would cost you 12,000. That makes your points worth 2.24 cents a piece.

Points redemption summary

  • If you're using the Chase Sapphire, Chase Freedom or Chase Ink Cash (Tier 1) you'll be redeeming points at a value of 1 cent per point.
  • If you're using the Chase Sapphire Preferred, Chase Ink Bold, or Chase Ink Plus (Tier 2) you'll redeem points for a minimum of 1.25 cents (towards travel) per point up to a max of 6.25 cents per point (when maxing out the 5x categories).

Full List of Ultimate Rewards Travel Partners

Travel

  • Amtrak Guest Rewards
  • Korean AIr Skypass
  • British Airways Executive Club
  • United Airlines Mileage Plus
  • Southwest Rapid Rewards
  • Virgin Atlantic Flying Club

Hotels

  • IHG Rewards Club
  • Marriott Rewards
  • The Ritz-Carlton Rewards
  • Hyatt Gold Passport

Spending Your Rewards On Other Programs

Delta SkyMiles has one of the larger partner airline networks around. For you, that means more options when choosing how to redeem your miles. All miles earned via your Delta credit card can be transferred at a ratio of 1:1 to any of the below partner airlines.

Aeroflot Aerolineas Argentinas Aeromexico
AirEuropa Air France Air Tahiti Nui
Alaska Airlines Alitalia China Airlines
China Eastern China Southern Czech Airlines
GOL Hawaiian Airlines Kenya Airways
KLM Royal Dutch Airlines Korean Air Middle East Airlines
Saudia Airlines Tarom Airlines Vietnam Airlines
Virgin Atlantic Virgin Australia Xiamen Airlines

Of course with the Sapphire Preferred you can redeem at just about any airline at 1.25 cents on the dollar or at one of their 10 travel partners for a variable (many times better) rate.

Starwood Preferred Guest program include all Starwood-owner hotels. And since you probably don't know which hotels are owned by Starwood we've included them all in the table below:

Aloft Element Four Points
Le Meridien The Luxury Collection Sheraton
St. Regis W Hotels Westin

* See the online credit card application for details about terms and conditions. Reasonable efforts are made to maintain accurate information. However all credit card information is presented without warranty. When you click on the "Apply Now" button, you can review the credit card terms and conditions on the issuer's website.

Disclaimer: This content is not provided or commissioned by the credit card issuer. Opinions expressed here are author's alone, not those of the credit card issuer, and have not been reviewed, approved or otherwise endorsed by the credit card issuer. This site may be compensated through the credit card issuer Affiliate Program. 

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