Annual Fee Blues? The Chase Sapphire Reserve Hidden Value

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I travel a few times a year.

Part of it gets reimbursed and I often get a free lunch or breakfast.

Sometimes I recoup rewards for free flights - even international airfare!

So, how can someone who doesn’t travel often get all these perks?

It’s called the Chase Sapphire Reserve credit card.

This has long been a coveted card for travelers since it debuted in 2016. But is this premium plastic a good fit for everyday consumers? Even after recent changes to the card’s benefits, is it still worth it for the average consumer/traveler when its annual fee is $550?

Let’s see how much money you are leaving on the table…

Earning & Redeeming: A Travel Powerhouse

The Reserve boasts a compelling rewards program via Chase Ultimate Reward points. You earn 3x points on travel and dining, with travel defined broadly (think taxis, tolls, even parking).

That's a solid baseline, but it gets better.

The card offers a hefty annual travel credit of $300 to offset travel purchases like flights, hotels, and car rentals. This effectively reduces the annual fee to $250. That credit posts once you charge travel expenditures to your card and continues to post until you use all $300.

OK - so maybe your travel is “reimbursed” rather than free. Either way, I’ll take it.

However, the true star of the show? The points. Chase UR points are some of the most valuable point currencies, as noted by The Points Guy. At a little over 2 cents per point, they can transfer to numerous travel partners such as airlines and hotels at a 1:1 ratio. Imagine transferring points for a business class ticket from US to Europe and paying just a few dollars for taxes. It’s possible.

Even the Chase travel portal allows you to redeem them for 1.5 cents per point, meaning a reward bonus of 60,000 points equals $900 in value (60,000 x .015 = 900).

Traveling luxuriously is no longer out of reach for most people. Check out our previous post on scoring a premium hotel of $700+/night overlooking the ocean.

Beyond Points: Perks for Savvy Travelers

The Reserve sprinkles in other benefits that elevate the travel experience. Airport lounge access through Priority Pass Select and Chase’s own Sapphire Reserve lounges let you unwind in comfort between flights, with select locations offering complimentary food and drinks. For families like mine, this perk can be a lifesaver, transforming layovers from stressful time wastes into relaxing downtime.

Not to mention the amount of money we save, easily $50-$100, when lunch is at the lounge and not at an expensive airport restaurant, which happens about 2x-3x per year.

The card also includes a monthly $5 DoorDash DashPass credit. I use this to pick up DoorDash orders I place myself. That’s another $60 per year right there.

What else? An annual statement credit of $100 every four years for Global Entry or TSA PreCheck, programs that expedite airport security screenings.

The Elephant in the Room: The Annual Fee

At $550, it's undeniably steep. This is where the "traveler vs. everyday consumer" distinction becomes crucial. If you don't travel often or carry a balance, the fee outweighs the benefits.

However, for those who embrace some amount of travel and are diligent in using all the available offers, we calculate the effective annual fee to be closer to $50-$100, if that.

Recent Changes and Enduring Value

The Reserve has undergone some recent changes. As of July 1, 2024, holders can no longer use the Priority Pass benefit at airport restaurants. It allowed up to $28 per guest, maxed at $56 total, for any food and drinks at partner restaurants. I used this feature at least 3x per year. While this feature will be missed, not all airports have these select restaurants, which wasn’t valuable to most.

Benefits like primary car rental insurance, trip cancellation, and delay coverage are still in effect. The core value proposition – earning a ton of points and enjoying luxurious travel perks – remains intact.

Making the Case for the Reserve

If you travel frequently and leverage the card's benefits, the Chase Sapphire Reserve can be an excellent financial tool. The combination of point multipliers, travel credit, and airport lounge access can significantly reduce your travel expenses.

Plus, if you have another Chase card already, the Reserve allows you to maximize your points-earning potential.

What to Consider?

• Do you travel at least 2-3x per year?

• Do you crave comforting airport layovers and free business-class airfare once in a while?

• Do you plan to redeem points for travel through Chase Ultimate Rewards?

If you answer yes to most of these questions, the Chase Sapphire Reserve might be the perfect card for you.

A high annual fee can be scary, but leveraging the right tools can decrease this amount to almost nil.

After all, the value we get from the card is more than $550 per year.

And that’s called saving money.

Save On,

Chris