Many people (myself included) signed up for the lucrative Chase Sapphire Reserve card when it launched in 2016. We indulged in its generous 100k sign up bonus and lavished its additional benefits. After a year of good times, the bill has come due again. It’s time to decide whether to keep, downgrade or cancel your card. For those who choose to maintain their card, there is a hefty annual fee of $450 which may still be worth it you.
This brings the next question, is the Chase Sapphire Reserve (CSR) card worth its yearly fee after the first year? The value of the card is quite clear for any individual who’s mouth watered at the 100k bonus. But for the second year and next, it’s up to you to decide if the benefits are worth the annual fee. Here we review some of the benefits provided and assist you in determining whether you want to keep card past the honey moon stage.
Annual Travel Credit Fee of $300
When you signed up to the CSR, you were offered $300 worth of travel statement credits every calendar year. Without any extra effort, the travel credit was conveniently credited to your account.
This practice has earned and maintained the reputation of the CSR being one of the most user-friendly and straightforward travel credit cards. Certain purchases are primarily defined in the travel industry and they include the common train, plane, hotel purchases as well as more obscure purchases such as turnpike tolls, parking fees, and uber rides.
TSA PreCheck or Global Entry Fee Credit:
This is another benefit on the CSR that’s relevant only once every four years, which makes it worth $25 annually (Sign up entry fee divided by four). If your travel credit is being used, then the value margin in the next couple of years is zero – all the more reason to keep the card.
More Point Value for Direct Redemptions:
Ultimate Rewards on CSR are worth 1.5 cents when you use your card to book travel through Chase’s online portal. Compared to annual fee Chase Ultimate Rewards cards, their online portal use are valued at 1.25 cents per points. The Freedom Rewards are a straight one cent per point. The downside of Freedom Rewards is the lack of transfer partners. To put the cents per dollar value into applicable numbers, if you redeemed 100K points via the portal per year, you would gain $250 in extra value with the CSR compared to one of the other annual fee cards.
Priority Pass Select:
This is another benefit offered by the CSR that genuinely makes their travel card stands out. It is an airport lounge benefit which includes unrestricted access for guests, with no limitations on the number of individuals that can tag along. Its perfect for anyone who travels with their friends or family. Having lounge access completely changes your airport experience. The free food and drinks add extra comfort to any wait time for a flight.
Three Times (3×) Points Earning on Travel and Dining:
One significant benefit from this card is that it earns you three points on each dollar spent on travel and dining purchases, which is an additional point compared to the Sapphire Preferred that are in the same bonus categories.
Do These Benefits Ensure That The Card Is Worth Keeping? Here’s How To Find Out:
Let’s say you intend to acquire at least one annual fee card and it comes with the opportunity to transfer your Ultimate Rewards to partners. With that card, you pay a yearly fee of $95. When factoring in the Sapphire Reserve’s travel credit valued at $300 in total – the annual fee is essentially $150.
This brings the question; are the extra benefits of the Sapphire Reserve worth the additional $55 annual fee? The lounge access can be easily worth $55 of some quiet time with free food and drinks. Having TSA PreCheck or Global Entry is another benefit that the other annual fee Chase cards don’t offer.
To sum it up, the CSR is worth keeping if the lounge access and Global Entry/ TSA PreCheck is worth $55 to you.
If you don’t feel the benefits of this card justify the annual fee, there are several options to downgrade to cheaper cards. Keep in mind that if you want to have access to transfer points, you need to possess a yearly fee card. Other options available that gives you access to Ultimate Rewards like the Chase Sapphire Preferred® Card is the; Ink business preferred credit card, Ink Bold® business charge card, and Ink Plus® Business Credit Card. If you possess any of them, it’s preferable to downgrade your Reserve card to a non-yearly fee card.
- Chase Freedom Unlimited℠:
This version of the Freedom card gives you an uncapped 1.5 points for each dollar on all purchases; however, it cannot transfer to partners.
- Chase Freedom® Card:
This version is a non-yearly fee card which gives you 5x points in rotating categories up to $1,500 to make use of per quarter. You cannot transfer points to partners with this card.
- Chase Sapphire® Card:
This version gives you 2x points on travel and dining booked via the Chase travel portal. This sapphire card limits you from transferring points to partners, if you want to remove the limitation, you will have to purchase one of the cards with a yearly fee.
• Chase Sapphire Preferred® Card:
This card offers 2x points earning on dining and travel, 1.25 cents per point on direct redemptions, and the ability to transfer your points to hotel and airline partners. The annual fee is $95.
Last Option (Cancelling the Card)
Cancelling the card won’t make sense for most people since there are several no annual cards to which you can product change. However, with Chase’s new restrictions on having multiple cards in the Sapphire family, if you have no use for one of the Freedom cards, cancelling may be the option for you. Keep in mind with the new Chase rule, you will not be allowed to have any card in the saphire family for 24 months.