Chase Ultimate Rewards: We Break Down How They Work

Chase Ultimate Rewards: We Break Down How They Work

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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 simply an all-around great cashback card, Chase has several options that will all let you start earning 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 annual fee card offerings are generally inferior to their annual-fee counterparts, and as such, we recommend applying for the fee-cards in most cases.

Chase Ultimate Rewards: 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 Flex℠ and Ink Business Cash® Credit Card 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 2 cards do have going for them though is that they're all no annual 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® Card, Chase Sapphire Reserve®, and the Ink Business Preferred℠ Credit Card. Though this selection of credit cards comes with hefty annual fees, they make up for that fact by giving your Ultimate Rewards more value -- between 25% and 50%, depending on which card you get.

These 'tier-two' cards also come with an additional option that makes 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 flexibility in where you spend your points and how much value you get for them.

The current Ultimate Rewards Transfer partners are:

  • British Airways Executive Club
  • JetBlue TrueBlue
  • Singapore Airlines KrisFlyer
  • Southwest Airlines Rapid Rewards®
  • United MileagePlus®
  • Virgin Atlantic Flying Club
  • Hyatt Gold Passport®
  • Marriott Rewards®
  • IHG® Rewards Club
  • Ritz Carlton Rewards®

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 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 the Chase Sapphire Preferred® Card you can transfer your rewards to partner loyalty programs where they can be worth significantly more.

Value of 1,000 Chase Ultimate Rewards when redeemed for various rewards

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® Card, where you earn 2X points on dining at restaurants including eligible delivery services, takeout and dining out and travel & 1 point per dollar spent on all other purchases worldwide. Depending on your spending patterns and how you like to shop for travel, Chase Ultimate Rewards offers the potential for significant savings on your spending.

The beauty of Chase Ultimate Rewards is that it balances flexible redemption options, with the opportunity for getting more value from your rewards. For shoppers willing to do a little more research and maximize their reward redemption, the Chase Sapphire Preferred® Card is the best way to achieve the best of both these worlds.

Chase Ultimate Rewards Credit Cards

Here is a side-by-side comparison of all the credit cards that will earn you Chase Ultimate Rewards points. You can read on ahead if you want a more in-depth look at each of the offers and what it excells at.

Chase Freedom Flex℠
Chase Sapphire Preferred® Card
Chase Sapphire Reserve®
Ultimate Rewards BonusEarn a $200 Bonus after you spend $500 on purchases in your first 3 months from account opening.Our best offer ever! Earn 100,000 bonus points after you spend $4,000 on purchases in the first 3 months from account opening. That's $1,250 when you redeem through Chase Ultimate Rewards®.Earn 60,000 bonus points after you spend $4,000 on purchases in the first 3 months from account opening.
Bonus Value Estimate$200$1,000$750
Annual Fee$0$95$550
APR14.99 - 23.74% Variable15.99% - 22.99% Variable16.99%-23.99% Variable
Foreign Trans Fee3% of each transaction in U.S. dollars$0$0
Read ReviewRead ReviewRead Review

The Chase Sapphire Preferred® Card: The Best Travel Rewards Credit Card

Chase Sapphire Preferred® Card

  • On Chase's Secure Website

$95

15.99% - 22.99% Variable

Excellent

  • Our best offer ever! Earn 100,000 bonus points after you spend $4,000 on purchases in the first 3 months from account opening. That's $1,250 when you redeem through Chase Ultimate Rewards®.
  • Earn 2X points on dining including eligible delivery services, takeout and dining out and travel. Plus, earn 1 point per dollar spent on all other purchases.
  • Get 25% more value when you redeem for airfare, hotels, car rentals and cruises through Chase Ultimate Rewards®. For example, 100,000 points are worth $1,250 toward travel.
  • With Pay Yourself BackSM, your points are worth 25% more during the current offer when you redeem them for statement credits against existing purchases in select, rotating categories.
  • Get unlimited deliveries with a $0 delivery fee and reduced service fees on eligible orders over $12 for a minimum of one year with DashPass, DoorDash's subscription service. Activate by 12/31/21.
  • Count on Trip Cancellation/Interruption Insurance, Auto Rental Collision Damage Waiver, Lost Luggage Insurance and more.
  • Get up to $60 back on an eligible Peloton Digital or All-Access Membership through 12/31/2021, and get full access to their workout library through the Peloton app, including cardio, running, strength, yoga, and more. Take classes using a phone, tablet, or TV. No fitness equipment is required.

Among all the cards under the Chase Ultimate Rewards banner, the Chase Sapphire Preferred® Card is the clear cut leader. For the $95 annual fee, the card increases the value of your rewards significantly. With the Chase Sapphire Preferred® Card you get a redemption bonus of 25% whenever booking through the Ultimate Rewards online travel portal. That alone boosts the value of a single Ultimate Rewards point to $0.0125. The Chase Sapphire Preferred® Card further allows you to transfer your points to various airline/hotel loyalty programs. All these things the card offers allow travelers to amplify their rewards rate.

The card has one of the better sign up bonuses we've seen. Cardholders can Our best offer ever! Earn 100,000 bonus points after you spend $4,000 on purchases in the first 3 months from account opening. That's $1,250 when you redeem through Chase Ultimate Rewards®.

The Chase Sapphire Reserve®: The Best Premium Travel Card Around

Chase Sapphire Reserve®

  • On Chase's Secure Website

$550

16.99%-23.99% Variable

Excellent

  • Earn 60,000 bonus points after you spend $4,000 on purchases in the first 3 months from account opening. That's $900 toward travel when you redeem through Chase Ultimate Rewards®
  • $300 Annual Travel Credit as reimbursement for travel purchases charged to your card each account anniversary year. Through December 31, 2021, gas station & grocery store purchases will also count towards earning your Travel Credit
  • 3X points on travel immediately after earning your $300 travel credit. 3X points on dining at restaurants including eligible delivery services, takeout and dining out & 1 point per $1 spent on all other purchases
  • Get 50% more value when you redeem your points for travel through Chase Ultimate Rewards®. For example, 60,000 points are worth $900 toward travel
  • With Pay Yourself BackSM, your points are worth 50% more during the current offer when you redeem them for statement credits against existing purchases in select, rotating categories
  • 1:1 point transfer to leading airline and hotel loyalty programs
  • Access to 1,300+ airport lounges worldwide after an easy, one-time enrollment in Priority Pass™ Select and up to $100 application fee credit for Global Entry or TSA Pre✓®
  • Count on Trip Cancellation/Interruption Insurance, Auto Rental Collision Damage Waiver, Lost Luggage Insurance and more

The Chase Sapphire Reserve® is widely believed to be the best luxury travel credit card around -- certainly the best out of all the Ultimate Rewards line up. First of all, this is one of the highest-earning Ultimate Rewards credit cards. You get 3X points on travel immediately after earning your $300 travel credit. 3X points on dining at restaurants including eligible delivery services, takeout and dining out & 1 point per $1 spent on all other purchases. You get a 50% bonus to your redemptions when using the points on the card through the Ultimate Rewards online travel portal. Therefore, the card's rewards rate translates to anywhere between 1.5% and 4.5%. You can also get Earn 60,000 bonus points after you spend $4,000 on purchases in the first 3 months from account opening.

If you get this card you'll have to contend with its $550 annual fee. Fortunately, it offers more benefits that help cancel this out. First, you get a $300 annual travel credit that can pay for things like airline tickets or taxi rides. You'll also get complimentary Priority Pass membership, worth hundreds of dollars. This will get you into luxury airport lounges around the world, making your time at the airport a lot more pleasant.

The Chase Freedom Flex℠: A cashback credit card for optimizers

Chase Freedom Flex℠

  • On Chase's Secure Website

$0

14.99% - 23.74% Variable

Excellent/Good

  • Earn a $200 Bonus after you spend $500 on purchases in your first 3 months from account opening.
  • Earn 5% cash back on up to $1,500 in combined purchases in bonus categories each quarter you activate. Enjoy new 5% categories each quarter!
  • Earn 5% on travel purchased through Chase, 3% on dining at restaurants and drugstores, and 1% on all other purchases.
  • No annual fee.
  • 0% Intro APR for 15 months from account opening on purchases, then a variable APR of 14.99 - 23.74%.
  • No minimum to redeem for cash back. Cash Back rewards do not expire as long as your account is open.

Don't be fooled. While the Chase Freedom Flex℠ is advertised as a "cashback card," it earns users Ultimate Rewards points. You Earn 5% cash back on eligible purchases in rotating categories, 5% on travel purchased through Chase, 3% on dining and drugstores, and 1% on all other purchases. On its own, the points with this card are worth $0.01 when used towards cash back. However, those who love optimizing their rewards can combine this card with the Chase Sapphire Preferred® Card. If you get both cards, you can pool all the points together and boost their value through the Chase Sapphire Preferred® Card, as we described above.

Bonus hunters can get a good deal on the Chase Freedom Flex℠, too. You can Earn a $200 Bonus after you spend $500 on purchases in your first 3 months from account opening.

The Chase Freedom Unlimited®: The Simplest Way to Earn Ultimate Rewards Points

Chase Freedom Unlimited®

  • On Chase's Secure Website

$0

14.99% - 23.74% Variable

Excellent/Good

  • Earn a $200 Bonus after you spend $500 on purchases in your first 3 months from account opening.
  • Earn unlimited 1.5% cash back on all other purchases.
  • Earn 5% on travel purchased through Chase, 3% on dining at restaurants and drugstores, and 1.5% on all other purchases.
  • No annual fee
  • 0% Intro APR for 15 months from account opening on purchases, then a variable APR of 14.99 - 23.74%.
  • No minimum to redeem for cash back. Cash Back rewards do not expire as long as your account is open

The Chase Freedom Unlimited® is designed with simplicity in mind. You Earn 5% cash back on travel purchased through Chase, 3% on dining and drugstores, and 1.5% on all other purchases. While you can get more with the cards we described above, those offers require you to be more involved. Unlike those other cards, the Chase Freedom Unlimited® doesn't require you to keep track of where you're spending your money or whether you're shopping within bonus categories. You simply get an above-average return no matter where you shop. That can be particulary useful for anyone who has needs that don't conform to typical credit card reward categories.

Chase Ultimate Rewards Business Credit Card Comparison

In this comparison snapshot you can get a quick look at the differences between both Chase Ultimate Rewards cards designated for business owners use. The Ink Business Cash® Credit Card is a cashback card while the Ink Business Preferred℠ Credit Card is a more general business rewards card:

Ink Business Cash® Credit Card
Ink Business Preferred℠ Credit Card
  • On Chase's Secure Website
  • On Chase's Secure Website
Ultimate Rewards BonusEarn $750 bonus cash back after you spend $7,500 on purchases in the first 3 months from account opening.Earn 100,000 bonus points after you spend $15,000 on purchases in the first 3 months from account opening.
Bonus Value Estimate$750$1,000
RewardsEarn 5% cash back on the first $25,000 spent in combined purchases at office supply stores and on internet, cable and phone services each account anniversary year. Earn 2% cash back on the first $25,000 spent in combined purchases at gas stations and restaurants each account anniversary year. Earn 1% cash back on all other card purchases with no limit to the amount you can earn.Earn 3 points per $1 on the first $150,000 spent in combined purchases on travel, shipping purchases, Internet, cable and phone services, advertising purchases made with social media sites and search engines each account anniversary year. Earn 1 point per $1 on all other purchases—with no limit to the amount you can earn.
Annual Fee$0$95
APR13.24% - 19.24% Variable15.99%-20.99% Variable
Foreign Trans Fee3% of each transaction in U.S. dollars$0
Read ReviewRead Review

*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.

Full List of Ultimate Rewards Travel Partners

Travel

  • Korean Air Skypass
  • British Airways Executive Club
  • United Airlines Mileage Plus
  • Southwest Rapid Rewards
  • Singapore Airlines KrisFlyer
  • Virgin Atlantic Flying Club

Hotels

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

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 to 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. One note: British Airways flights tend to come with pretty hefty fuel surcharges that apply whether you're booking normal or award 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.

Ultimate Rewards Points Redemption Summary

  • If you're using the Chase Freedom® or Ink Business Cash® Credit Card (Tier 1) you'll be redeeming points at a value of 1 cent per point.
  • If you're using the Chase Sapphire Preferred® Card or Ink Business Preferred℠ Credit Card (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).

How To Earn Extra Chase Ultimate Rewards Points

Beyond the sign-up bonuses, Chase has established multiple avenues for Chase credit card holders to build up Ultimate Rewards points, with only slight differences from card to card.

Special Ultimate Rewards Promotions

In addition to the usual bonus earning rates we have covered, Chase will offer new promotions and points-earning rates from time to time. These temporary promotions may not catch your attention on their own, so if you wish to truly maximize your Ultimate Rewards points, call in periodically to check for anything you may have missed.

One important but simple example is to keep an eye on the sign-up bonus for your card for the first 90 days after you sign up. If it increases from the bonus you signed up for, you can call in to request the new bonus amount, which Chase will often grant.

Buying Gift Cards to Translate Spending Across Categories

Many retailers carry a selection of gift cards that can be spent with other merchants, both online and brick-and-mortar. These can provide a means of translating your purchases under a bonus category into a less points-friendly expense. For example, Staples, an office supply store which yields 5 points per dollar with the Ink Plus® Business Credit Card and the Ink Business Cash® Credit Card, offers gift cards to places ranging from Starbucks to Home Depot, which are not bonus categories for either of those cards.

Warning: Sometimes, the purchase of a gift card may be flagged as a cash advance. This is an extremely expensive transaction that comes with fees and higher APR attached. After purchasing a gift card, make sure it is registered as a purchase. If it went through as a cash advance, you will not receive any points, and will only end up losing money. You can read more about these types of transactions in our detailed guide here.

Using the Chase Ultimate Rewards Mall

The Chase Ultimate Rewards Mall is another easy way to earn points. If you have a big purchase coming up you can get anywhere between 1 extra point per $1 to 25 points, depending on the store. The most common bonuses range between 1-2 points. As of August 2016, the mall includes 242 stores. The brands range from Apple to Rite Aid and REI. When we examined prices on the Ultimate Rewards mall we didn’t find any price discrepancies. The dozen-or-so websites we checked had prices that matched up with the original website. Therefore, you don’t have to worry about being up-charged.

Clicking through to one of the stores takes you to their respective online portals where you can complete the purchase. Be careful that you don’t close the merchant’s website. If you do, you will have to go through the Chase portal once again to get the extra points.

The information related to the Chase Freedom® has been independently collected by ValuePenguin and has not been reviewed or provided by the issuer of this card prior to publication.

Joe Resendiz

Joe Resendiz is a former investment banking analyst for Goldman Sachs, where he covered public sector and infrastructure financing. During his time on Wall Street, Joe worked closely with the debt capital markets team, which allowed him to gain unique insights into the credit market. Joe is currently a research analyst who covers credit cards and the payments industry. He earned a bachelor’s degree from the University of Texas at Austin, where he majored in finance.

These responses are not provided or commissioned by the bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by the bank advertiser. It is not the bank advertiser's responsibility to ensure all posts and/or questions are answered.

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How We Calculate Rewards: ValuePenguin calculates the value of rewards by estimating the dollar value of any points, miles or bonuses earned using the card less any associated annual fees. These estimates here are ValuePenguin's alone, not those of the card issuer, and have not been reviewed, approved or otherwise endorsed by the credit card issuer.

Example of how we calculate the rewards rates: When redeemed for travel through Ultimate Rewards, Chase Sapphire Preferred points are worth $0.0125 each. The card awards 2 points on travel and dining and 1 point on everything else. Therefore, we say the card has a 2.5% rewards rate on dining and travel (2 x $0.0125) and a 1.25% rewards rate on everything else (1 x $0.0125).