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Million Mile Secrets reader, Natalie, commented:
I have the Capital One Venture Visa Signature card and I can purchase a flight then use the ‘fare eraser’ to use my points to pay for that flight.
Does the Chase Sapphire Preferred do the same? I LOVE that it gives you 2 points per $1 on certain things!!
Thanks for your question, Natalie!
And what’s even better is you can transfer Chase Ultimate Rewards points to airline and hotel partners for Big Travel!
What’s the Difference?
Link: Capital One Venture
Link: Chase Sapphire Preferred
|Card||Sign-Up Bonus||Benefits||Foreign Transaction Fees||Annual Fee|
|Capital One Venture||40,000 miles when you spend $3,000 on purchases within the 1st 3 months of opening your account||• 2X miles on every purchase|
• Redeem for cash back at .5 cents per mile
• Redeem for paid travel at 1 cent per mile
|None||$59 annual fee waived for the 1st year|
|Chase Sapphire Preferred||50,000 Chase Ultimate Rewards points when you spend $4,000 on purchases within the 1st 3 months of opening your account|
• 5,000 bonus Chase Ultimate Rewards points when you add an authorized user who makes a purchase within the 1st 3 months
|• 2X Chase Ultimate Rewards points on travel and dining|
• 1X Chase Ultimate Rewards points on other purchases
• Redeem for cash back at 1 cent per point
• Transfer to airline and hotel partners like United Airlines, Southwest, British Airways, and Hyatt for Big Travel!
|None||$95 annual fee waived for the 1st year|
Many folks like the Capital One Venture card because you can use the miles you earn for paid flights and you earn 2X miles on every purchase. So you don’t have to worry about finding award seats, looking through award charts, or shopping in certain categories.
I don’t talk about this card much because Capital One will pull your credit from all 3 credit bureaus and many folks in our hobby would rather apply for multiple cards instead of one. But it’s a good card for folks who want simplicity.
You’ll only earn 2X Chase Ultimate Rewards points on travel and dining with the Chase Sapphire Preferred card.
But not all points are created equal. Chase Sapphire Preferred points can be worth much more than Capital One Venture miles depending on how you redeem them.
Important Note: Although Capital One calls them “miles,” you can NOT use Capital One miles with airline frequent flyer programs to book award tickets.
Redeeming for Paid Travel
With the Capital One Venture card, you can use the Purchase Eraser to redeem your miles at 1 cent per mile within 90 days of your purchase for a statement credit to cover the cost of paid travel. Or you can use your miles to book paid travel through the Capital One portal at 1 cent per mile.
According to the terms, Capital One defines paid travel as:
Purchases made from airlines, hotels, rail lines, car rental agencies, limousine services, bus lines, cruise lines, taxi cabs, travel agents and time shares are generally considered to be travel purchases and availability for redemption is based on the merchant category code assigned to them by the merchant. Capital One is not responsible for how merchants assign these codes.
You’ll earn 2 cents toward travel for every $1 you spend on the Capital One Venture card.
Natalie likes this perk because she doesn’t have to worry about blackout dates and she earns miles and points for her flight or hotel!
She can also book paid travel with the Chase Ultimate Rewards points she’ll earn with the Chase Sapphire Preferred card, at 1.25 cents per point through the Chase Travel portal, which is better than the 1 cent per point she gets with the Capital One card.
Which card is better depends on how much bonus category spending she does.
If she doesn’t make a lot of travel and dining purchases to earn 2X Chase Ultimate Rewards points with the Chase Sapphire Preferred, most of her purchases will earn 1 Chase Ultimate Rewards point per $1. So she’ll get 1.25 cents per $1 spent (on non-bonus spending like groceries). In this case, the Capital One Venture card’s 2 cents per $1 spent is a better deal.
Natalie might consider both cards! Use the Chase Sapphire Preferred to earn 2X on travel & dining, because it’s really 2.5% off her next travel purchase thru the portal. (2 Chase Ultimate Rewards points X $1 X 1.25 cents per point.) Then use Capital One Venture for her other spending.
That is, unless she wants to invest a little time to learn about airline and hotel award charts. That’s when your points become really powerful. Because you can fly in Business Class and stay in amazing hotels.
However, Natalie can earn 2.5 cents (2X Chase Ultimate Rewards points on travel & dining X 1.25 cents per point) per $1 spent on travel and dining. And if she spends more than 60% in these bonus categories, she’ll get more travel with the Chase Sapphire Preferred.
Let’s say she spends $10,000 per year on a card. If $6,000 of her purchases are on dining & travel (60% on her total spending) and $4,000 is non-bonus spending, then she’ll earn:
16,000 Chase Ultimate Rewards points with the Chase Sapphire Preferred ($6,000 X 2X points on travel and dining + $4,000 X 1X points on everything else), or
20,000 miles with the Capital One Venture card ($10,000 X 2X points on all spending)
That would give her $200 in travel with Chase Sapphire Preferred (16,000 Chase Ultimate Rewards points X 1.25 cents per point) or $200 in travel with the Capital One Venture card (20,000 miles X 1 cent per mile).
So if more than 60% of her purchases are on dining and travel, then Chase Sapphire Preferred is the better choice.
And if she wants more bonus categories to earn more Chase Ultimate Rewards points she could also sign-up for the Chase Freedom to earn 5X Chase Ultimate Rewards points (5% cash back) in rotating categories each quarter!
Money in Your Pocket!
You can also redeem the miles and points you earn with the Capital One Venture and Chase Sapphire Preferred cards for cash back. This gives you the ultimate flexibility, because you can use points any way you want!
With the Chase Sapphire Preferred, each point is worth 1 cent for cash back. With the Capital One Venture each point is only worth 0.5 cents for cash back.
So while you’ll earn 2X points everywhere with the Venture card, you’ll still earn the same 1% in cash back as you would with the Chase Sapphire Preferred. (2 Capital One Venture points X $1 X 0.5 cents per point)
You’ll get twice as much cash back when using the Chase Sapphire Preferred to earn 2X points on dining and travel. Because in those categories you earn 2% cash back instead of 1% with the Venture card. (2 Chase Ultimate Rewards points X $1 spent on dining & travel X 1 cent per point)
Transfer to Airline and Hotel Partners for Big Travel!
Although Natalie will pay a higher annual fee of $95 (waived the 1st year) for the Chase Sapphire Preferred card than she does with Capital One Venture, it may be well worth it if she likes luxury travel.
That’s because what really sets the Chase Sapphire Preferred apart from the Capital One Venture card is the ability to transfer points to airline and hotel partners. This could change Natalie’s travel life!
She can get much more than 2 cents per point when she redeems for Big Travel like international Business Class on United Airlines, flights on Southwest when you have the Companion Pass, or stays at top Hyatt hotels.
In the example above, you get a value of ~4 cents per point (~$1,760 for 2 nights / 50,000 points)! A stay like this would cost you ~176,000 Capital One Venture miles!
Which Card Is Better?
So if you’re interested in cash back, both cards are equal. Unless you do a lot of travel and dining spend, then Chase Sapphire Preferred wins.
But if you’d rather book your own travel with your card and redeem miles for those purchases later, the Capital One Venture card is a better option.
And if you want to redeem your miles and points to book paid travel through the credit card company, you get more out of the Capital One Venture at 1 cent per mile (because you earn 2 miles per $1 on everything) versus the 1.25 cents per Chase Ultimate Rewards point. Again, unless you do a great deal of spending is on travel and dining, then the Chase Sapphire Preferred card wins.
For folks looking for Big Travel with Small Money, the Chase Sapphire Preferred card is the better choice because you can transfer to partners like United Airlines and Hyatt for luxury travel and get more than 2 cents per point!
So the better card depends on what you want to use the miles and points for and how much you spend on travel and dining.
Chase Sapphire Preferred also has great customer service! A real person answers the phone right away, so you don’t have to navigate those frustrating robotic menus. Plus, the 50,000 Chase Ultimate Rewards points you’ll earn by completing the minimum spending could be worth it.
Don’t Want to Worry About Bonus Categories or Transferring to Partners?
She can earn 40,000 Arrival miles ($400 in travel) when she spends $3,000 on purchases within the 1st 3 months of opening her account. And she’ll earn 2 miles per $1 spent on all purchases, plus a 5% rebate on miles when redeeming for travel purchases of $100 or more.
The Citi Double Cash card is another option, which will give her 1% cash back on all purchases and 1% cash back on all payments with NO annual fee.
With the Capital One Venture card you can earn 2X miles on all purchases and redeem the miles you earn for paid flights, which means no blackout dates and you earn miles and points for your trip.
But if you prefer the simplicity of no bonus spending categories and no award charts, you get with the Capital One Venture card, you might consider cards like the Barclaycard Arrival Plus or the Citi Double Cash.
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