9 Amazing Benefits of Ultimate Rewards (Above American Express Rewards)

The tides in the ocean of frequent flyer miles is always shifting.

One definitive parting is the emergence of two very valuable credit card rewards programs – Ultimate Rewards (Chase) and American Express Rewards (American Express).

In my book, How to Earn Frequent Flyer Miles from the Comfort of Your Living Room, I wrote, “I’ve found that there is really only one points program that is seriously worth your consideration if you are doing it for points. That is the American Express Rewards points.”

That statement is no longer true!

I’ve already compared the Ultimate Rewards program and American Express Rewards program for flights, but today I’ll share why I’m going to focus on earning Ultimate Rewards.

Benefits of the Ultimate Rewards Program

1.  The current Ultimate Rewards (UR) sign up bonuses are better.

The Chase Sapphire Preferred is offering 40,000 UR points after spending $2,500 in the first three months.  Compare that to the American Express® Premier Rewards Gold Card which is only offering 25,000 American Express Rewards points after spending $2,000 in the first 3 months of Card membership.

You bet that I’m going to sign up for the one with the better bonus!

In addition, you can find a way to get Ultimate Rewards with the Chase Freedom (learn more here), Chase Sapphire Preferred, and Chase Ink.  That’s a lot of cards feeding into one program!

2.  Ultimate Rewards seems to be gaining momentum.

From the stats on my site each month, more and more people are joining Ultimate Rewards.  Probably on this site, it’s almost triple to quadruple the number of people who get Ultimate Rewards cards over and above American Express Rewards related cards.

UR has also recently announced the addition of United and Korean Air as transfer partners.  With the momentum, I can only assume this program will get better.

In January 2012 Southwest was added as a Ultimate Rewards transfer partner.

3.  Ultimate Reward cards have lower annual fees. 

With my credit card spending patterns (less than the average person), it takes me a lot longer to make up the differences in the annual fees.

I’d much rather have the $95 Chase Sapphire Preferred card than the $175 Premier Gold card.

4.  Ultimate Rewards don’t charge fees to transfer to other programs.

When you transfer UR points, there is no fee.  However, American Express does charge a minimal fee.  It might only be $.06 per 1,000 points, but it certainly is a factor.  A 100,000 mile transfer will cost $60.

5.  Ultimate Rewards has a better backup ticket purchase option.

With the 20% bonus when you book your travel using the UR booking portal, UR points are a much more viable option for booking paid tickets.

6.  Earning opportunities.

With the Chase Sapphire Preferred’s 2 points per dollar spent on travel, it’s a great card for travelers.  Mind you, the Premier card does offer 3 points per dollar on airfare, so if you spend enough on airfare, that may justify the expense.  If you have the Chase Freedom linked in, you can also get 5 points per dollar in certain categories.  See the best cash back credit cards with mileage transfer options.

7.  No foreign currency exchange fee.

I’d rather have the Sapphire Preferred card in my pocket because it has no foreign currency exchange fees.  Most American Express cards do have a foreign currency exchange fee.

8.  You can easily transfer UR points to someone else’s mileage account. 

Thus, if you have a United account (for example) I can easily transfer my points to your account.  With American Express rewards it is possible, but I believe it is technically a violation of their terms and conditions.

9.  The current (and potentially future) Ultimate Rewards partners are more appealing.

The main American Express Rewards partner that has any level of appeal for me is the Air Canada Aeroplan program.  However, if I were going to collect points for that program, I’d prefer to use the American Express Fidelity card which allows users to earn 2 miles on every dollar.

I’ve been happy with the Star Alliance offering of flights, and I think the United MileagePlus program is strong.  The only other program I may prefer is American Airlines, but they aren’t transfer partners with either (though they are with the Starwood program).

I’ve also been looking into some Amtrack options, and I think there are some good values there.

In Favor of American Express Rewards

The one big factor in favor or American Express rewards it that they typically offer transfer bonuses.  UR has yet to do so!

Of course, American Express Rewards is going to be better if you prefer one of their transfer partners.

Anyway, that’s why I’m giving preference to the Ultimate Rewards program.  What about you?  Sticking with American Express Rewards, or thinking about transferring your points allegiance?

Comments

  1. says

    Craig, I’m curious to know how you value UR and MR points. Are they typically worth more than $0.02 per point?

    The reason I ask – I see other travel bloggers recommending AMEX PRG, Chase Sapphire Preferred, and BA Visa for everyday spend. But when I do the math, it doesn’t make sense to pay the annual fees of all these cards. My annual spend is roughly $60k so maybe that’s not nearly high enough.

    I keep coming back to CapitalOne Venture Rewards because I effectively get $0.02 cash back on all spending for a $65 annual fee. That equates to $1,135 in total annual rewards after fees. Am I missing something?

    • Craig says

      Ben,
      That is an excellent question.

      To help answer that question I’ll point you in the direction of a post I wrote for a personal finance blog called Free Money Finance – http://www.freemoneyfinance.com/2011/10/the-case-for-the-mileage-based-credit-card.html.

      As you can see in that post there are several instances where my ‘miles’ were worth more than $0.02.

      In fact just this week I was looking into flights for someone to Europe. Tickets cost $880 in economy. With United it as 60,000 miles plus $80. Using 60,000 miles is a better deal than paying $880.

      However, if you’re going to be traveling domestically and your tickets usually cost less than $250 you’re better off with something like the Capital One Venture Rewards card.

      You are right, you need to spend a lot to be able to justify annual fees on multiple cards. In that case a person needs to be sure to do the math.

  2. says

    Thanks Craig, I appreciate the thoughtful response and the link you posted. I think miles are great when you get them via credit card signup bonuses, but I’m not sure about everyday spending.

    For instance, in your example the United miles are only worth 1.33 cents each (60k / $800). I would have to spend $40k to earn $800. A person with a United card has to spend $60k because you only get 1 mile per dollar spend.

    I’d love to see a post on the best cards for everyday spending. I’m just trying to figure out the best place to put my spend after I’ve completed my signup bonuses.

    Thanks for the great blog!

    • Craig says

      Ben,
      I actually have written a post on the topic, but not published it. Perhaps I’ll add it to the schedule to be published soon.

  3. james says

    The no-fee Chase Freedom offers 5 Ultimate Rewards points/dollar up to $1500 spend per quarter – q4 2011 categories are: Dining, Dep’t. Stores, Movies, and Charitable Contributions. Otherwise, the Chase Sapphire Preferred is my go-to card for all everyday, dining & travel where I don’t have a hotel’s credit card.. I still use Amex Gold Premiere Rewards for 2x Gas/Groceries. If you’ll be redeeming points for Hyatt or UA/CO ( I get more than 2 cents per point for my Hyatt redemptions), the Ultimate Rewards may be more valuable to you than SPG Starpoints.

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