There were a lot of angry people after the recent United and Hyatt devaluations since it also decreased the transfer value of Chase Ultimate Rewards points. This prompted many people, including myself temporarily, to shun the use of the Sapphire Preferred card in favor of other cards. After all, Ultimate Rewards points had been watered down pretty heavily (who would want to spend so much money to earn 160K points just to get one round trip Business Class flight to Asia?) while the Barclay’s Arrival card provides the best cash back rate at 2.22% on all purchases.
Many people switched to the Arrival card for normal purchases in order to earn cash back since the new, super-high redemption rates on United were no longer worth attaining (except through manufactured spend). But let’s take a step back and evaluate the current values of these cards.
As a reminder, the Sapphire Preferred card gives 2x points on all travel and restaurant purchases. It also provides a year-end dividend of 7% on all the points earned the previous year. Therefore you can look at the card as earning 2.14 points-per-dollar on travel/restaurants and 1.07 points-per-dollar on all other purchases. If you book travel through the Ultimate Rewards Portal, your points are worth 1.25 cents each, plus you can transfer them to partners to potentially get even more value.
On the other hand, the Arrival card earns 2x points on all purchases, but there are no transfer partners so it is strictly cash back. Each point is worth 1 cent, and if you redeem the cash back for travel purchases, then you get a 10% rebate. That means you essentially earn 2.22 points-per-dollar on all purchases.
So let’s compare the value of the points we earn from these two cards in a couple of examples.
Example 1: $15K of Annual, Non-Bonused Spending
The points earned shown above should be straightforward. The value might require some further explanation for some people, so here’s how I got to those numbers: with the Sapphire Preferred card, you can redeem your points for travel at 1.25 cents per point (that’s why they say the 40K sign-up bonus is worth $500). So the 16,050 points multiplied by $0.0125 becomes $200.63. With the Arrival card, each point you earn is worth only 1 cent (but remember you earned 2 points on the purchase, so it’s like being worth 2 cents) plus a 10% rebate. So the 30,000 points are multiplied by $0.011 and becomes $330.00.
Thus, for non-bonused spend, the Barclay’s Arrival Card is far superior to the Sapphire Preferred card when redeeming for travel purchases in my opinion.
Example 2: $15K of Annual, Bonused Spending
In the bonus categories of travel and restaurants, the Sapphire Preferred card will earn 32.1K points that would be worth $401.25 in travel. The points earned and subsequent value from the Arrival card remain completely unchanged at $330.00 since it has no bonus categories.
That means all purchases on travel and restaurants should be put on the Sapphire Preferred card, with pretty much no exceptions (except if you have a 5x option). Also consider that UR points are more flexible with the transfer partners and can potentially be worth much more.
The Barclay’s Arrival card has undeniable value, particularly for non-bonused spending. You earn 2.22 cents per dollar on everything, making it superior to all other cards that provide some form of cash back. The only other card I’d put in the same category in terms of value is the SPG Amex, since SPG points are flexible and have a high potential value.
The Sapphire Preferred card is still the best card to use for travel and restaurant purchases, assuming you don’t have a 5x option. Not only are the points more valuable when redeeming for travel through Ultimate Rewards, but you have the added flexibility of choosing to transfer them to one of several transfer partners in case you find a better option. Remember, there is a sweet spot around $312.50 for redeeming through Ultimate Rewards vs transferring points.
If you want to sign up for a Barclay’s Arrival card, consider using my affiliate link – support is appreciated!