When To Downgrade vs. Cancel a Credit Card
Welcome to the Points Pro, where I answer your travel rewards and credit cards questions each week. If you have a question you’d like answered, you can submit it here.
This week, CNBC Select editor Emily Canal asks :
The short answer: It’s understandable that you want to cancel your Sapphire Reserve, but there are downgrade options you can explore before you pull the plug. And if you’re interested in JetBlue, a non-JetBlue credit card may be better for quickly accumulating JetBlue points.
Let’s take a look at what you can do about your Sapphire Reserve’s annual fee and a few travel credit cards that can help you secure your next JetBlue flight.
How to earn JetBlue TrueBlue points
Airline credit cards are rarely the best cards for earning airline miles. A co-branded card for your favorite airline can make sense if you value its perks, such as free checked bags, or if you use it to help earn elite status. In your situation, I would keep the JetBlue card if you value those benefits.
If you want to earn JetBlue points, a travel credit card that allows transfers to JetBlue is likely to be more rewarding. Chase Ultimate Rewards®, Wells Fargo Rewards and Citi ThankYou® Rewards all offer cards that enable 1:1 transfers to JetBlue’s TrueBlue program.
All three of the JetBlue consumer cards earn bonus points on JetBlue purchases (3X to 6X points depending on the card), as well as 2X points at restaurants and grocery stores and 1X points on all other purchases. Unless you spend a lot on JetBlue airfare or JetBlue Vacation packages, you can earn more JetBlue points with a non-JetBlue card.
The Citi Strata Premier® Card is a solid choice for earning points you can transfer to JetBlue at restaurants, supermarkets and gas and electric vehicle (EV) charging stations because it earns 3X points on these purchases. That’s on top of 10X points on hotels, attractions and car rentals booked through cititravel.com and 3X points on airfare and other hotel purchases.
The Citi Strata Premier® Card has competitive rewards rates and unlocks access to all of the Citi ThankYou® transfer partners, which boosts the value of your points.
- Unlocks point transfers to all of the Citi ThankYou® partners, including Emirates Skywards, Choice Privileges, Flying Blue and more
- Generous bonus spending categories include dining, supermarkets, hotels and flights
- Valuable welcome bonus
- Has an annual fee
- Car rental coverage is secondary, not primary
Highlights
Highlights shown here are provided by the issuer and have not been reviewed by CNBC Select’s editorial staff.
- Earn 60,000 bonus ThankYou® Points after spending $4,000 in the first 3 months of account opening, redeemable for $600 in gift cards or travel rewards at thankyou.com.
- Earn 10 Points per $1 spent on Hotels, Car Rentals, and Attractions booked on CitiTravel.com.
- Earn 3 Points per $1 on Air Travel and Other Hotel Purchases, at Restaurants, Supermarkets, Gas and EV Charging Stations.
- Earn 1 Point per $1 spent on all other purchases.
- $100 Annual Hotel Benefit: Once per calendar year, enjoy $100 off a single hotel stay of $500 or more (excluding taxes and fees) when booked through CitiTravel.com. Benefit applied instantly at time of booking.
- No expiration and no limit to the amount of points you can earn with this card.
- No Foreign Transaction Fees on purchases
Balance transfer fee
Balance transfer fee applies with this offer 5% of each balance transfer; $5 minimum.
18.49%, 24.49%, or 28.49%
The Wells Fargo Autograph® Card offers generous bonus spending categories and lets you transfer points to airline and hotel partners, which is rare for a credit card with no annual fee.
- Access to all of the Wells Fargo transfer partners including Flying Blue (Air France/KLM) and Virgin Red
- No annual fee
- Excellent bonus spending categories
- Intro-APR for purchases
- No travel credits or other valuable travel perks
- Lacks key travel protections such as trip delay reimbursement and trip cancellation/interruption coverage
Highlights
Highlights shown here are provided by the issuer and have not been reviewed by CNBC Select’s editorial staff.
- Apply Now to take advantage of this offer and learn more about product features, terms and conditions.
- Earn 20,000 bonus points when you spend $1,000 in purchases in the first 3 months – that’s a $200 cash redemption value.
- Earn unlimited 3X points on the things that really add up – like restaurants, travel, gas stations, transit, popular streaming services, and phone plans. Plus, earn 1X points on other purchases.
- $0 annual fee.
- 0% intro APR for 12 months from account opening on purchases. 18.49%, 24.49%, or 28.49% variable APR thereafter.
- Up to $600 of cell phone protection against damage or theft. Subject to a $25 deductible.
- Redeem your rewards points for travel, gift cards, or statement credits. Or shop at millions of online stores and redeem your rewards when you check out with PayPal.
- Find tickets to top sports and entertainment events, book travel, make dinner reservations and more with your complimentary 24/7 Visa Signature® Concierge.
Balance transfer fee
3% intro for 120 days from account opening, then up to 5%, min: $5
Foreign transaction fee
The best part of these cards isn’t the stacks of JetBlue points you can earn; it’s that you have options beyond JetBlue. If JetBlue doesn’t serve the destination you want to visit or have available award flights, you can take advantage of the other transfer partners at your disposal.
This might be something you’ve already experienced with your Sapphire Reserve and its many travel partners, including JetBlue. That brings us to the other part of your question: What to do about the hefty annual fee you don’t want to pay.
Downgrading vs. canceling your Sapphire Reserve
The simplest way to avoid paying an annual fee is to call and cancel the card. If the annual fee has already been charged to your account, Chase will typically refund it if you close your card within 30 days of the annual fee posting.
Before canceling, here’s what I would do:
- Use your rewards; in your situation, I would transfer them to JetBlue, another partner or redeem them for 1 cent each for cash back or gift cards.
- Use as many of the benefits as possible (if you haven’t already).
- Switch payment methods for any automatic bills that are charged to your Sapphire Reserve account.
Canceling isn’t your only option, though. You can pay less for a different Chase credit card by calling and asking to downgrade. There are several advantages to downgrading, including:
- You keep your points.
- The account stays open on your credit report.
- You can keep the same account number, as long as the new card is a Visa, which is the payment network the Sapphire Reserve uses.
Age of accounts is part of your credit score, albeit a small one. Depending on your situation, keeping your credit card open by downgrading it may not make a huge difference to your score, but it’s good to be aware of.
A good downgrade option is the Chase Sapphire Preferred® Card (see rates and fees), which has a $95 annual fee and lets you transfer to the same travel programs as the Sapphire Reserve. It also has excellent travel insurance.
Personally, this is probably what I would do, depending on how many Chase Ultimate Rewards® points you have. I value the Sapphire Preferred’s primary rental car insurance because it lets me decline the rental company’s collision coverage, saving me $15 or more per day when I rent a car.
Just keep in mind that when you downgrade a Chase credit card, you aren’t eligible for a welcome bonus.
The Chase Sapphire Preferred® Card packs a punch for a $95 annual fee card, offering annual travel credits, comprehensive travel protections and more.
- You can transfer rewards to all of Chase’s travel partners including World of Hyatt, Southwest Rapid Rewards and many more
- Long list of travel and shopping protections
- $50 annual Chase Travel hotel credit
- Has an annual fee
- Requires a high credit score
Highlights
Highlights shown here are provided by the issuer and have not been reviewed by CNBC Select’s editorial staff.
- Earn 75,000 bonus points after you spend $5,000 on purchases in the first 3 months from account opening.
- Enjoy benefits such as 5x on travel purchased through Chase TravelSM, 3x on dining, select streaming services and online groceries, 2x on all other travel purchases, 1x on all other purchases
- Earn up to $50 in statement credits each account anniversary year for hotel stays through Chase TravelSM
- 10% anniversary points boost – each account anniversary you’ll earn bonus points equal to 10% of your total purchases made the previous year.
- Count on Trip Cancellation/Interruption Insurance, Auto Rental Collision Damage Waiver, Lost Luggage Insurance and more.
- Complimentary DashPass which unlocks $0 delivery fees & lower service fees for a min. of one year when you activate by 12/31/27. Plus, a $10 promo each month on non-restaurant orders.
- Member FDIC
Balance transfer fee
Either $5 or 5% of the amount of each transfer, whichever is greater
However, if you have so few Chase points that it’s not worth paying even $95 to keep them alive, the no-annual-fee Chase Freedom Unlimited® (see rates and fees) could make sense. It’s a cash back credit card, but the cash back is earned as Chase Ultimate Rewards® points (1 cent = 1 point). So, you can keep the same points, and down the road, you could upgrade the Freedom Unlimited to a Sapphire Preferred if you want to regain the ability to transfer points.
The Chase Freedom Unlimited® is a no-annual-fee card that earns generous cash-back on everyday purchases and a lucrative welcome bonus.
- Valuable welcome bonus and high rewards rates
- Long intro APR for purchases and balance transfers
- No annual fee
- Has a foreign transaction fee
- Few rewarding ongoing benefits
Highlights
Highlights shown here are provided by the issuer and have not been reviewed by CNBC Select’s editorial staff.
- Limited Time Offer: Earn a $250 Bonus after you spend $500 on purchases in your first 3 months from account opening
- Enjoy 5% cash back on travel purchased through Chase TravelSM, our premier rewards program that lets you redeem rewards for cash back, travel, gift cards and more; 3% cash back on drugstore purchases and dining at restaurants, including takeout and eligible delivery service, and 1.5% on all other purchases.
- No minimum to redeem for cash back. You can use points to redeem for cash through an account statement credit or an electronic deposit into an eligible Chase account located in the United States!
- Enjoy 0% Intro APR for 15 months from account opening on purchases and balance transfers, then a variable APR of 18.24% – 27.74%.
- No annual fee – You won’t have to pay an annual fee for all the great features that come with your Freedom Unlimited® card
- Keep tabs on your credit health, Chase Credit Journey helps you monitor your credit with free access to your latest score, alerts, and more.
- Member FDIC
Balance transfer fee
Intro fee of either $5 or 3% of the amount of each transfer, whichever is greater, in the first 60 days. After that, either $5 or 5% of the amount of each transfer, whichever is greater.
Foreign transaction fee
3% of each transaction in U.S. dollars
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