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Starwood Preferred Guest Luxury Card vs the Chase Sapphire Reserve

Today we’re talking expensive credit cards. In general, I’m not a huge fan of holding multiple, premium ones. This is primarily due to diminishing returns. AKA benefit overlap. There are only so many Global Entry credits or Priority Pass Select memberships that one can use. Considering they cost upwards of $400 each, they’re simply too expensive to open frivolously.

With everything just mentioned in mind, today, we’re looking at what I consider the card most likely to generate a positive net value, the Chase Sapphire Reserve and comparing it to the newcomer from American Express, the Starwood Preferred Guest Luxury Card.

Annual Fee and Signup Bonuses

Let’s get right into it. We’ve got a $450 annual price tag on both. Not waived the first year. This isn’t a big concern though, as both offer signup bonuses worth over double that. It’s year two and after that we’re really worried about.

Starwood Preferred Guest Luxury Card vs Chase Sapphire Reserve Signup Bonus

The Starwood Preferred Guest Luxury card is currently advertising 100,000 bonus points after $5,000 in spend within the first three months. Before anyone gets too excited, we’re talking about the new combined Marriott Rewards/SPG currency. It would be a ton more lucrative if these were the old Starpoints. Nevertheless, they’re still quite valuable. In my latest reckoning, I found they were worth an even 1¢ each, making this signup bonus worth a very compelling $1,000.

I’m disappointed by the minimum spend requirement. It matches the Amex Platinum, but is still quite high. $5,000 is a lot to run through a card. With that in mind, I would consider this card when I had some bigger purchases on deck.

Not to be outdone, Chase currently offers 50,000 membership rewards to new Sapphire Reserve customers. These are earned after a much more palatable $4,000.

Based on my most recent valuations, Chase Ultimate Rewards are worth 2.19¢ each. This makes that 50,000 point signup bonus worth approximately $1,095. Alternatively, if you prefer simple, these points can be redeemed directly through Chase for $750 worth of travel or $500 in cash.

Value of Points Earned

Here is where points and miles valuation really come into play. So often I have to defend some of these pricey cards because many people have trouble looking past the earn side. Going slightly off-topic for a second, but take the Citi Costco Anywhere Visa for example. It’s arguably the best free credit card available. Currently, it earns 3% cash-back on dining and travel purchases. So, one might argue it’s earning potential equals that of the Chase Sapphire Reserve, which also earns 3 points per dollar spent at restaurants or on travel. But, the fact, or, more accurately the opinion, that Ultimate Rewards are worth 2.19¢ a piece means one’s effective earn rate on money spent in these categories is 6.57%. Potentially a lot more if one is savvy and/or patient with their point redemptions.

costco visa vs sapphire reserve

So, sorry about that topic detour, it’s just a point I always think is worth repeating because it always seems to come up.

Now, let’s really get back to the two cards we’re dealing with today, the American Express Starwood Preferred Guest Luxury Card and the Chase Sapphire Reserve. The former’s signup bonus is worth $1,000 and the latter’s, $1,095. Considering both will run you 450, our out-the-door net earn is a respective $550 or $645. These are numbers most people can get behind. It’s what happens from here on out that’s really the sell.

Overlapping Benefits

Let’s continue with how they’re the same. Both offer a domestically useless, but internationally clutch, Priority Pass Select Membership. Furthermore, they match each other in number of guests allowed, two. Neither will charge foreign transaction fees and will reimburse the cardmember for their Global Entry membership or TSA Pre-check costs.

Statement Credits

From here on out, things start to diverge, with some wins in the SPG’s column, and some in the Sapphire Reserve’s. Let’s talk statement credits. The Amex SPG Luxury Card provides and annual $300 reimbursement for purchases made at Starwood or Marriott hotels. It’s a good perk, but it’s not a great one. For that, we turn to the Sapphire Reserve. It also offers $300, but this will be applied to any purchase coded as travel. Airfare, Ubers, hotels, the category is broad. This one a win for the Sapphire Reserve.

Points Earned on Everyday Spend

For everyday spend, the SPG Luxury card offers 6 points per dollar on Marriot or SPG purchases, 3 ppd on restaurants and airfare and 2 ppd on everything else. Because SPG/Marriott points are worth an even 1¢ each, this means we’re earning 6, 3 and 2%.

spg luxury card and sapphire reserve everyday spend

For it’s part, the Sapphire Reserve earns 3 points per dollar on travel and dining and 1 point on everything else. It’s really worth repeating, that travel and dining is a much broader category than Amex’s restaurants and airfare. Because Ultimate Rewards are worth more than twice as much, we’re actually earning 6.57 or 2.19%. This is another win for the Chase Sapphire Reserve.

Trip Cancellation and Lost Luggage Protection

Since both of these products are geared towards the traveling crowd, trip cancellation coverage is a bit more important than it might be otherwise. Without getting too far into the weeds, the SPG Luxury Card will reimburse up to $10,000 per trip, the Amex offering won’t. It’s yet another win for the Sapphire Reserve.

If, on this hypothetical trip, you happen to lose your bags along the way, both cards will step in a hook you up. Both will reimburse up to $3000. However, Chase extends this to immediate family members. This one is nuanced, but the Sapphire Reserve just keeps rolling out the hits.

Emergency Medical and Evacuation

starwood preferred guest luxury card vs chase sapphire reserve emergency medical

Alright, it’s Amex’s turn for a win, sort of. Let’s talk emergency medical services and transportation. If you are injured while traveling on a common carrier, American Express provides up to $500,000 in accidental death and dismemberment coverage. In the case of the Sapphire Reserve, we’ve only got $100,000 to work with. However, the devil as they say, is in the details. Chase extends this coverage to the entire trip whereas Amex only covers the transit phase. So I’ll call this one a toss-up. Amex wins for coverage limits but Chase wins for coverage scope.

Purchase/Return Protection

Now purchase protection has always been something that American Express does extremely well. Let’s see if that reputation stands up to reality when we look at what the SPG Luxury card offers. If any new purchases are damaged or stolen within 120 days of purchase, Amex will reimburse you, up to 10,000 per claim and 50,000 per year. Chase matches these limits exactly, so this one is a draw. For what it’s worth, I had to test Chase’s theft protection when my camera was jacked from a TPG event last year. This was back was the limit was only $500. While that amount wasn’t enough to cover the loss, the reimbursement process went very smoothly.

I’m not sure if it’s perception or reality, but many manufacturers have been getting pretty stingy when it comes to returns. Best Buy for example, limits returns to a paltry 15 days for most items. Side note, why does anyone actually shop there anyway. Getting harassed by clueless teenage salespeople hawking overpriced accessories or warranties just sounds miserable. Thankfully, as a Sapphire Reserve or SPG Luxury Card holder you’ve got some breathing room. Chase provides return protection out to 90 days, $500 per item and $1,000 per year. For it’s part, Amex extends the return window out to 120 days, but only offers coverage up to $300 per item and $1,000 per year. Some nuanced differences, but this is another draw.

Extended Warranties

Finally, under the umbrella of retail coverage we’ve got some automatic extended warranties offered by both cards. On warranties of 5 years or less, they’ll extend that by two years. Chase only furthers it by 1 year, and only on warranties of 3 years or less. Amex for the win.

Rental Car Coverage

starwood preferred guest luxury card vs chase sapphire reserve rental car coverage

Lastly, we’ve got rental car coverage. Both offer free collision damage waivers, however, the one offered via the Sapphire Reserve is primary coverage, whereas Amex’s is secondary. This is a pretty important detail. Enough of one that I make sure to always book any rental cars on my Sapphire Reserve. Basically, what this means, is that Amex’s coverage begins where your personal insurance ends. Chase on the other hand, covers you from the beginning.

Time for some SPG Luxury Card Wins

So thus far, it’s been a pretty one-sided fight. But Amex has a couple pocket aces that might sway one’s decision. The most important of which, is the annual free night award. As a cardholder, you’ll receive one free night at a participating Starwood or Marriott hotel every year. Unfortunately, this is limited to those bookable for 50,000 points or less. Sadly, one will still have to pay any uber-shady resort fees.

starwood preferred guest luxury card annual free night

This could actually be very valuable. Referencing the current Marriott redemption chart and we see category 7 hotels currently cost 50,000 points per night off-peak or one could book an on-peak category 5. To translate this into real-world dollars let’s take a look at a couple properties.

The West New York Times Square would qualify, and for a random date I picked in October is selling for $459 per night. We’ve also got the Renaissance Paris available, cash price would be $664. Finally, let’s take a glance at The Westin Excelsior, Rome. It too would qualify or is bookable with cash for $754. Without really trying, and just taking a cursory glance, we’re averaging $625 in value from this perk. This alone covers the cost of the card. Although, it’s really worth noting, that this benefit becomes available AFTER one’s first anniversary. It really does nothing to sway the math for year one.

Westin NYC Times Square $459
Renaissance Paris $664
Westin Excelsior Rome $754
Average $625

The Starwood Preferred Guest Luxury cardholder gains automatic elite status with the chain. Gold to be specific. You know, I always struggle to place a value on hotel status. Big ticket items are the 25% bonus points on stays, room upgrades if available, guaranteed late checkout, enhanced internet and few other things I don’t find valuable enough to talk about. So, it’s like, if Marriott was selling this on the open market, how much would someone pay for it? Back in August, The Points Guy valued this status at $725. I think that’s way too much. The analysis he used assumed an average 30 nights a year. For a business traveler, sure. But for the leisure traveler, a third of that sounds more realistic. Let’s call it $250

Let’s Draw some Conclusions

I think we’re at the point now, that we can ask ourselves a couple questions:

  1. Which card will provide the most value in year one?
  2. What card provides the most continuing value in year two and beyond.

Answering question one, let’s start with that signup bonus. The Chase Sapphire Reserve’s is worth $1095 and the Starwood Preferred Guest Luxury Card’s, 1000.

Thus far, we haven’t talked about the value of points earned over the year, so let’s do that. It’s a really hard thing to generically value because everyone’s spending patterns are different. Back when I compared the Southwest Priority Card to the Sapphire Preferred, I used my own 2017 spending as the basis, so I’ll do that here. I’m not using the real dollars, I’m using the real category percentages, and applying that to a hypothetical 18,000 annual spend.

starwood preferred guest luxury card vs sapphire reserve spend

The Starwood Preferred Guest Luxury Card will provide one with $433.99 worth of points and the Chase Sapphire Reserve, $559.98. So, in this chart we’ve got some categories that don’t exactly match Amex’s or Chase’s. That’s because some spend here would qualify for a bonus, and others wouldn’t. I just kind of went in the middle.

Next up is the Priority Pass select membership. Value here depends on one’s travel habits. But let’s just say each visit is worth $10. I know one is charged $27 per visit if actually using a Priority Pass traditional membership, but I think this is grossly overpriced, so I’ll stick with 10. Let’s also assume a modest 5 visits per year, each with a guest, we can then assign a value of $100 to this perk. You know, trying to place a value on this one makes astrology look like an exact science.

The Global Entry credit is pretty straightforward, it’s worth $100.

Moving on we’ve got our travel statement credits. $300 easily goes in the Sapphire Reserve’s column. It’s a little tougher to definitely place a value of $300 for the Starwood card’s annual Marriot statement credit simply because one would have to be pretty certain one would actually spend that much at a Marriott property in a given year. For me that’s not a certainty. I’m not remotely loyal to a hotel brand. That said, most considering the Starwood Preferred Guest Luxury Card probably do have some affinity for the chain, so we’ll place the full value here.

Lastly, we’ve got all the ancillary benefits. Purchase protection, extended warranties, rental car damage waivers, etc. It’s really hard to say how much all of this is worth without getting an actuary involved, and that is certainly out of this channel’s budget. Let’s just call it 100 bucks. Take it out if you think it’s worth less.

Oh yeah, then we’ll add in the value of the Marriott Gold Elite status, 250, but only on the SPG card.

Starwood Preferred Guest Luxury Card Year One Chase Sapphire Reserve Year One
Signup Bonus 1,000 1,095
Year One Earned Points Value 433 559
Priority Pass Membership 100 100
Global Entry/TSA PreCheck 100 100
Statement Credits 300 300
Misc. Insurances 100 100
Gold Elite Status 250
Benefits Subtotal 2,283 2,254
Cost of Card (450) (450)
Net Value $1,833 $1,804

Netted all out and we’ve got a value of $1,833.99 for the Starwood Preferred Guest Luxury card and $1,804.98 for the Sapphire Reserve. This is after we’ve dropped in the annual fees.

So, it’s shockingly close. It’s really obvious here that Amex and Chase watch each other closely and make sure they’re offering competitive products. Even though these two cards produce nears as makes no difference net values, I’d still opt for the Sapphire Reserve. If anyone remembers from a bit ago, each of the ancillary benefits was just a little bit better on the Chase card. But that’s not enough to sway my decision. What would do it for me, is the existence of very-high travel award redemptions. Now we’re not talking averages here. I’m talking about really taking my time and only transferring Ultimate Rewards when I can get those 5¢ awards via a transfer partner. While it is true one can transfer Marriott Rewards to airlines, the transfer ratios typically make this a not-so-great option. Chase on the other hand, goes 1 to 1.

Now, let’s move on to year two, and things get really interesting. This is because signup bonuses are no longer available, but that really valuable SPG free night perk comes into play. Here are the numbers. Value from earned points remains the same, so do most ancillary benefits, aside from the Global Entry or PreCheck credit. However, that big $625 now showing up really sways the math towards the Starwood Preferred Guest Luxury Card. It’s now $750 more valuable than the Sapphire Reserve.

Starwood Preferred Guest Luxury Card Year One Chase Sapphire Reserve Year One
SPG Free Nights Award 625
Year Two Earned Points Value 433 559
Priority Pass Membership 100 100
Statement Credits 300 300
Misc. Insurances 100 100
Gold Elite Status 250
Cost of Card (450) (450)
Net Value $1,358 $609

I kind of just have to say wow. I didn’t expect this. In my mind, the Chase Sapphire Reserve has been the defacto card to beat. The one that always manages to come out on top whenever I’m doing these side-by-side value comparisons. I’m not even joking, I’m really, really surprised. Even if we were to say the Marriott Gold Elite Status is worth nothing, and cut that free night value in half, the Luxury card from American Express still beats the Sapphire Reserve by almost $200. I expected to knock out this analysis and once again prove just how valuable Chase’s premium card is, and I just can’t do it.

The Verdict

For the last several years, I would always roll my eyes at anyone who claims to have found a card that provides more value than the Sapphire Reserve. In 2018, it remains my go-to, everyday spender. I love the Ultimate Rewards program, it’s my favorite award currency. All that said, I can’t argue with my own numbers. At this very moment in time, the Starwood Preferred Guest Luxury Card by American Express is the better option.

Should one get the American Express #SPGLuxuryCard or the #SapphireReserve? We run the numbers to find out if Chase's best card still reigns supreme. #travel #travelcards

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