Personal Finance

The heyday of card sign-up bonuses may be done, but here are some deals

Chase plans to slash Sapphire Reserve card's bonus

The Chase Sapphire Reserve credit card was the one to beat when it came to sign-up bonuses, offering $1,500 to people who spent $4,000 on the card in the first three months.

That era of big sign-up bonuses may be coming to an end. JPMorgan Chase recently announced it would eventually cut that bonus in half. Now savvy shoppers who search for the best rewards may be seeking other plastic.

You still have until Thursday to apply online for the full award from the card that graced the cover of Bloomberg Businessweek and made reward-points nerds' hearts skip a beat. If you really must have the full offer, you can still apply at Chase branch until March 12.

As with any credit card, the devil is in the details. Chase Sapphire Reserve charges a $450 annual fee, though it will cut $300 off if you spend it on travel.

Beyond Chase Sapphire Reserve, several card issuers still offer bonuses worth $1,000 or more. (See table below.)

"Chase Sapphire Reserve is still my favorite travel card," said Sean McQuay, a credit card analyst with NerdWallet. "If you are not a frequent traveler, you may be better off with a cash-back card with no annual fee."

CitiBank and Chase both offer no-annual-fee cards that provide lucrative cash-back bonuses, McQuay said.

With the Citi Double Cash card, you receive 1 percent back on every dollar you spend and another 1 percent back when you pay off your purchases regardless of where you spend.

The Chase Freedom card gives you 5 percent cash-back when you shop at a rotating list to retailers, such as gas stations, grocery stores and restaurants.

Rewards cards, whether they have an annual fee or not, only work well if you spend enough to qualify for sign-up bonuses and pay off your balance every month.

The perks of rewards come with a hidden price. These cards typically charge more interest than plastic that doesn't offer rewards. For example, the national average interest rate for a credit card is 15.33 percent, according to, while the lowest rate Chase Sapphire Reserve offers is 16.24 percent.

Credit card rates are expected to rise this year as the Federal Reserve plans to increase its benchmark rate.

"If you haven't done so already, 2017 is the perfect time to pay off your credit-card debt," said Matt Schulz, senior credit card analyst at

High-fee rewards cards may continue

Sign-up bonuses above $1,000 may be dwindling, but they could stage a comeback soon.

Even though the sign-up bonuses cost Chase up to $300 million in profit, demand for the Sapphire Reserve card exceeded the industry's expectations and proved there is a bigger market for high-fee rewards cards if issuers offer the right incentives, Schulz said.

"I honestly don't think we've seen the end of high sign-up bonuses," Shulz said.

Why? Consumer confidence is at its highest since August 2001. Charge-off and delinquency rates for cards are the lowest levels since before the Great Recession. And banks are eager to attract and retain well-heeled customers who qualify, Schulz said.

McQuay disagrees. Chase is better capitalized than its competitors, such as American Express, and if they couldn't afford the lucrative $1,500 offer, he doubts other issuers will follow suit now.

"The Chase Sapphire Reserve sign-up bonus was jaw-dropping," McQuay said. "We may not see one like that again anytime soon."