Membership Rewards vs. Ultimate Rewards vs. ThankYou Rewards. Which is best?

The big 3 credit card issuers, Amex, Chase, and Citibank, have a lot in common. Each offers a proprietary rewards program in which points can be redeemed for travel or merchandise. Each allows points to be transferred to a selection of airline and hotel programs. And, each offers options to pay for travel with points and get better than 1 cent per point value. At a high level, its hard to distinguish one from another, but in practice there are big differences between the programs.

So which is best? Amex Membership Rewards? Chase Ultimate Rewards? Citi ThankYou Rewards? For an overview of each of these programs, please see “A quick guide to transferable points programs.”

Recently, I published a series of posts showing how to make use of multiple credit cards in order to average more points per dollar from everyday spend. By using the right cards in the right situations it may be possible to average more than 2 points per dollar in any one of these programs. Please see:

• Best credit card combos: Ultimate Rewards
• Best credit card combos: Membership Rewards
• Best credit card combos: ThankYou Rewards

The above series showed how to maximize points per dollar earnings, but it didn’t address which program is best. If you had to pick just one, which program should you focus on? That’s what I hope to answer here.

Best for non-travel rewards

The only way to consistently get outsized value from your points is to use them for travel. If you don’t travel often, though, you may prefer to get free stuff or even cash back. If you want cash back, only Chase Ultimate Rewards (of the 3 programs discussed here) makes it easy to get 1 cent per point. With Citi, it’s possible to get 1 cent per point cash back, but you have to be sneaky about it. So, Chase has the decided edge.

With all 3 programs, when you exchange points for merchandise you’ll usually get, at best, 1 cent per point value. In almost all such cases, you would be better off getting 1 cent per point cash back (where possible) and then buying the item outright at the best price you can find.

Overall best for non-travel rewards: Chase Ultimate Rewards

Best for pay with points rewards

Many bank programs let you buy airfare and other travel with points. There are a couple of big advantages to buying airfare this way. For one, you never have to worry about whether or not award flights are available. In general, if a flight can be purchased with cash, then it can be paid for with points too. Another advantage is that you can earn airline miles and elite credits when flying on point-purchased fares. The same is not true of flights booked with airline miles.

A big disadvantage of paying with points is that you generally can’t get outsized value for your points. Each point is usually worth a fixed amount towards travel. With most banks, each point is worth exactly 1 cent each towards travel. With Amex, Chase, and Citi, though, there are ways to do better:

• Amex Membership Rewards: 1.43 cents per point towards flights on one selected airline (as of July 1, 2015). To get this value, you’ll need the Amex Business Platinum Card. $450 annual fee.
  UPDATE 11/17/2016: You can now get 2 cents per point value with the Amex Business Platinum Card!
• Chase Ultimate Rewards: 1.25 cents per point towards travel (airfare, hotels, and car rentals). To get this value, you’ll need a premium Ultimate Rewards card such as the Sapphire Preferred or Ink Plus cards. Both cards currently have $95 annual fees.
  UPDATE 11/17/2016: With the new Chase Sapphire Reserve card you can get 1.5 cents per point value.
• Citi ThankYou Rewards with Prestige Card: 1.6 cents per point towards American Airlines flights; 1.33 cents per point towards all other airlines. To get this value, you’ll need the Citi Prestige card which costs either $350 or $450 per year depending upon how you get the card (in-branch signups usually get the $350 price) or whether or not you have CitiGold checking ($350 annual fee with CitiGold checking).
  UPDATE 11/17/2016: The Citi Prestige 1.6 cents per point benefit is going away in July 2017.
• Citi ThankYou Rewards with Premier Card: 1.25 cents per point towards airfare, hotels, car rentals, and cruises. To get this value, you’ll need the Citi Premier card which costs $95 per year.

Best overall per point value: Citi ThankYou Rewards Amex Membership Rewards

Best for airline mile rewards

Each of the 3 programs allows cardholders to transfer points to airline miles as long as the cardholder has one of several premium cards. Amex has a long list of eligible cards including the EveryDay cards, Platinum cards, and Premier Rewards Gold card. Current Chase offerings that qualify include the Sapphire Preferred and Ink Plus. Citi requires either the Premier or the Prestige card.

Each program has unique airline transfer partners. From the Frequent Miler Transfer Partner Master List, we see the following options:

Here’s a view filtered to some of the most useful programs on the list (in my opinion):

The best options for you depend upon your flying preferences, where you tend to fly from and to, and whether or not you’re willing to pay fuel surcharges. For this analysis, though, let’s look just at a preference for flying economy vs. premium cabin (e.g. business or first class).

Best for economy airline mile rewards

Both Amex and Chase are pretty strong here. British Airways offers, by far, the cheapest short-distance awards (as low as 4,500 points) and both programs transfer to British Airways. And, Virgin Atlantic (which all 3 programs have in common) offers very low priced economy awards to England, especially when they offer award sales. While they do charge hefty fuel surcharges, they cap them to a reasonable level for economy awards.

Air France (supported by both Amex and Citi) has some amazing deals and award sweet spots (details here), but they have bizarrely threatened to shut down accounts of people who make use of these transfers!

Amex has an edge with support for a number of domestic carriers: Delta, JetBlue, Virgin America, etc. That said, Amex charges a small Airline Excise Tax Offset Fee when transferring points to US airlines.

Chase, meanwhile, allows transfers to both Southwest and United. Southwest is probably the best bet for low-cost domestic awards (and a few international awards). United doesn’t have the cheapest award chart, but they have lots of advantages:

• They never pass on fuel surcharges
• They belong to the largest alliance: Star Alliance. As a result, international award availability tends to be excellent.
• They allow one stop-over and two open-jaws on round-trip awards. This makes it possible to visit multiple places on one trip.
• Their online award booking tool is pretty good.
• While United charges more for business and first class international awards on partner airlines, they do not charge extra in economy.

Even though Amex arguably has a larger number of useful transfer partners for economy travel, Chase has the three most useful ones (in my opinion): United, Southwest, and British Airways.

Best for economy airline mile rewards: Chase Ultimate Rewards

Best for premium international airline mile rewards

If you’re looking for international business or first class awards, both Amex and Chase are again strong contenders.

On the Amex front: ANA offers a number of amazingly low cost business class awards (economy too), but you do have to watch out for fuel surcharges. Delta has good business class award availability on a number of international partners (such as Virgin Australia, for example). They do often pass on partner fuel surcharges, but they’re usually not exorbitant. And, Aeroplan has a few sweet spots, too, but just as with ANA, you do have to watch out for high fuel surcharges.

With regards to Chase: Their secret weapon for premium flights to Asia is Korean Airlines. Korean tends to have wide open first class availability almost anytime. For flights to the rest of the world, United can be a good option for business class. Flights to South America, in particular, are competitively priced even on partner airlines.

All three programs support Singapore Airlines. While Singapore can be a great choice for premium flights, its not a differentiator between the 3 programs.

Overall, even though both Amex and Chase have pros and cons, Amex offers a larger selection of options for premium awards.

Best for premium international airline mile rewards: American Express Membership Rewards

Best for hotel point rewards

Here are the current hotel transfer options…

• Amex: Best Western; Choice; Hilton (1 to 1.5 ratio); and Starwood (1 to .33 ratio)
• Chase: Hyatt; IHG; Marriott; Ritz-Carlton
• Citi: Hilton (1 to 1.5 ratio)

With most hotel loyalty programs, points are worth far less than airline miles. So, if you have a choice of transferring bank points to airline miles or hotel points, you should usually choose airline miles. In fact, with most hotel programs, I would rather transfer my bank points to pennies (at one cent per point value) than to hotel points one to one.

Two exceptions to the “hotel points aren’t worth much” rule are Hyatt and Starwood. Chase transfers 1 to 1 to Hyatt. Amex meanwhile transfers at a poor 3 to 1 ratio to Starwood (3 Amex Membership Rewards points become 1 Starwood Preferred Guest point). There’s no contest here.

Best for hotel point rewards: Chase Ultimate Rewards

Best for sharing points

An important consideration with almost any rewards program is whether there are options for sharing points across multiple accounts. I covered the rules, by program, in “A quick guide to transferable points programs.” Here they are again:

• Amex Membership Rewards: US cardholders cannot move their Membership Rewards points to other accounts. However, it is possible to transfer points to another person’s frequent flyer program if the recipient is an authorized user on your Membership Rewards credit card account.
• Chase Ultimate Rewards: Chase allows cardholders to freely move points from/to their spouse or significant other living at the same address. The recipient must also have a Chase credit card that earns Ultimate Rewards points.
• Citi ThankYou Rewards: Citi allows ThankYou members to move points to anyone’s ThankYou account, but points will expire 90 days after transfer.
  UPDATE 11/17/2016: Citi has now imposed a 100K per year limit on moving points

Citi has, by far, the most flexible sharing options.

Best for sharing points: Citi ThankYou Rewards

Conclusion

The three transferable points programs have a huge amount of overlap, but they’re each strong in different ways. If I had to pick one, I’d say that Chase Ultimate Rewards is the best overall program. This conclusion is partly drawn from the analysis above, and partly from my own experience: even though I have points in all three programs, I find myself using Ultimate Rewards most often (see: Chasing Ultimate Rewards).

Luckily, we don’t have to choose just one. Citi ThankYou points are were awesome for those who fly American Airlines often (details here), and Amex Membership Rewards is great for its long list of transfer partners and its frequent transfer bonuses (sometimes they offer extra miles for particular transfers).

Coming soon: I plan to finish up the “Best credit card combos” series with a post showing the best card combinations for earning a mix of Membership Rewards, Ultimate Rewards, and ThankYou Rewards. After that, it will be time to look in depth at cash back combos.

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