Life after cancelling Chase Sapphire Reserve
Background
I signed up for this card hours after it was released(~Aug 2016). I actually signed up, while on a business flight, as it was such a great deal at the time, for someone in my situation that happened to travel a lot for business. The current situation with remote work, gave me a a pause to re-evaluate my needs for a card with a $550 annual fee, which I can't take full advantage off.
I planned to cancel in 2020, but the benefit of the TSA-pre renewal put me at a break even for the year.
Who can benefit from this card
If you are doing even a few trips a year, use the card regularly and have built up a point balance, and intend travelling, the Chase portal rewards for travel is a really great way to spend the points to reduce the cost of travel. I have used the points for multiple international flights in the past few years and have no complaints. Never used it for first class or business rewards as they are not worth the premium to me.
Evaluating the next best options, after cancelling
In my situation, the card did not fit my needs and the annual fee could not be justified. I still had a backup Chase Freedom unlimited which is great for a blanket 1.5% reward on everything.
In my search I was able to short list on a few cards that met my new projected spending habits and could yield a better reward ratio.
My short list and notes
Fidelity - 2% cash back. Already had a relationship with Fidelity. 0% annual fee. Easy and simple - 2% cash back, irrelevant of category. Cashback deposited into Fidelity account.
BoA - There are a number of cards and options available. However the prefered card, which offered up to 75% bonus, based on tiers, was worth considering. The bonus/incentives got this card on the radar. They will need to be re-evaluated as the bonuses expire after 12/31/2021.
Amex - The old Amex Blue card has been in the sock draw for years, as the Reserve has been my primary card for the past 5 years. However, the upgrade offer to the Amex Blue Cash Preferred, $95 fee, with $75 rewards after $1500 spend seemed worth considering.
My steps to migrate
Called to cancel Reserve. Asked to move credit limit from Reserve to Freedom Unlimited. This reduced the impact on credit score.
Amex - the upgrade was listed on the Amex portal. There are definitely better deals, when applying for this as a new card. In my situation it made more sense to convert, with a reduce reward, to maintain the credit history.
Fidelity - Had to send secure message to confirm that promotion was applied to account ( $150 reward after $1,500 spend)
BoA - signup flawless as an existing customer. ($500 reward after $3000)
Analysis
In the past I used the Reserve for anything travel related and used the Freedom unlimited for almost everything else.
One exception though, I use the Amazon prime card for Whole Foods and Amazon (5% rewards)
Meeting the minimum spend for the 3 new cards required some analysis. Here's a snapshot of my analysis.
A few of my yearly expenses met the timing for meeting the minimum spend requirements. In some cases it was worth allocating a bill to a card to meet the requirements, even if it was not the best reward ratio. Fortunately, I really don't have many bills, so it was a challenge to ensure that the few that I did have got the best bang for the $.
It even made sense to pay the property tax bill using a reward ratio of 2.63%, while the fee was 2.25%. I had never considered doing this in the past as the delta for the Freedom unlimited at 1.5% was not worth it.
Plan for the next 12 months
Downgrade amex before the annual fee hits. The 6% reward on streaming is the only real benefit for me and probably will not cover the fee.
Keep the Fidelity as a catch all as it had no annual fee.
Re-evaluate the benefits of BoA after 12/31/2021
Criteria and reasons for these cards
Already had existing relationship with the 3 financial institutions.
Evaluated the Costco Citi card. The 2% back at Costco can be matched with the Fidelity card. Gas reward is better than most. Previous bad experience with Citi bank was a factor.
Was trying to avoid cards with new financial institutions. Avoid sharing data with another party.
Did not want to consider American Air, Southwest, Barcklays, United as airline miles get devalued over many years. Might consider one of these if there is a good incentive and signup bonus in the future.
References and links
https://my.travelfreely.net/card_list
https://www.doctorofcredit.com/best-current-credit-card-sign-bonuses/
https://www.nerdwallet.com/best/credit-cards/cash-back
http://www.creditcardtuneup.com/
Notes
I don't endorse the sites in the referral links. Most will have sponsors results and have referral and affiliate links. I use them for research only. Realize that they have a incentive to gently nudge you in a directions. Always perform your own due diligence.
Closing or changing cards can impact credit score. However, if done correctly and tacitly, the impact can be minimized. Credit Karma provides useful tips and strategies to understand your own situation.
Below are the 3 cards and links to each site. These are not referral links and are provided for convenience to lookup the benefits and terms directly from the provider.
