Do the benefits offset the $ 550 annual fee?

The Chase Sapphire Reserve® card was so popular when it was launched in 2016 that Chase experienced a metal shortage needed to make the card.

Since then, the Sapphire Reserve has created a loyal following of card members who have learned to take advantage of the card’s premium travel benefits, including the desired $ 300 annual travel credits and free access to the lounge. airport.

Last year, the Sapphire Reserve card underwent several upgrades, most notably when Chase raised its annual fee to $ 550. Still, the card made a lot of profits with new partners like Lyft, DoorDash and Peloton helping to balance the higher annual fee.

If you expect to travel again this year, we recommend that you add this card to your wallet. CNBC Select then breaks down the benefits, benefits, and commissions of the Chase Sapphire Reserve, so you can decide if the card is worth it.

If you are a diner or a frequent traveler, this rewards program is for you. Earn 3X points on trips and restaurants around the world and 1X points on other purchases. Plus, earn 10X points on Lyft purchases by March 2022.

The Welcome Bonus is also top-notch: Earn 50,000 bonus points after spending $ 4,000 on purchases for the first three months after opening your account.

The Sapphire Reserve has two unique advantages that can maximize the value of your points by 50%:

1. Portal Chase Ultimate Rewards®: Simply use your points to book hotels, airfares, cruises and more directly through the travel portal.
2. Pay back: Use this tool to redeem points for a credit excerpt on purchases at grocery stores, dining halls (including restaurants, takeaways, and eligible freebies), at home improvement stores (such as Home Depot, and Lowes) and for contributions to a dozen eligible charities. Valid until April 30, 2021.

If you use any of these redemption options, the 50,000-point welcome voucher is worth up to $ 750.

CNBC Select has calculated how many rewards an average American can get if they optimize the way they use their Chase Sapphire Reserve card. We worked with the location intelligence company Esri, which provided us with a sample annual cost budget of $ 22,126.

The budget includes six main categories: groceries ($ 5,174), gasoline ($ 2,218), restaurants ($ 3,675), travel ($ 2,244), utilities ($ 4,862), and general shopping ($ 3,953).

Here are how many points you can earn with your Chase Sapphire Reserve card in each category:

• Groceries: 5,174
• Gas: 2,218
• Dining out: 11,024
• Trips: 6,733
• Utilities: 4,862
• General purchases: 5,929
• Total: 35,940

If you change these points to travel through Chase Ultimate Rewards® or Pay Yourself Back, you will receive a 50% bonus, which increases the approximate value from $ 359 to about $ 539 per year. (This does not take into account the annual fee or the welcome bonus.)

When you count the $ 550 annual fee and the 50,000-point welcome bonus, first-year earnings drop to about $ 309 for regular refunds, assuming 1 point is worth a penny. If you decide to redeem points through Chase Ultimate Rewards or Pay and receive 50% more value, the value goes up to approximately $ 739. (This is because the bonus is now worth $ 750 and not $ 550).

The Chase Sapphire Reserve card offers more than two dozen benefits for cardholders, which add value to the points we mentioned earlier.

Many of the best benefits have a clear value of between $ 60 and $ 300 each. When optimized, these benefits can help you more than offset the $ 550 annual fee.

These are the main advantages:

• $ 300 annual travel credit to compensate for flights, hotel stays and more
• $ 100 credit for the PreCheck Global Entry / TSA commission every four years
• Complementary DashPass (worth approximately $ 119) for a minimum of one year (register before December 31, 2021)
• Extracted credit of up to $ 120 to Platoon digital and full access season tickets (register before December 31, 2021)
• $ 60 DoorDash credit in 2021
• Complementary year of Pink Lift subscription (worth approximately $ 239 per month), which includes a 15% discount on car travel, relaxed cancellations and priority airport pick-up
• Access to Priority Pass Select (valued at $ 429), giving you access to more than 1,000 VIP lounges in more than 500 cities around the world

In addition to these benefits, you can take advantage of useful travel and shopping coverage, such as:

• Protection for eligible purchases that are lost or damaged
• Return protection for items that meet requirements that the store will not recover
• Extended warranty protection on eligible purchases
• Roadside assistance while traveling to the United States and Canada
• Exemption from automatic rental collision damage
• Baggage delay insurance
• Reimbursement of lost luggage
• Travel cancellation / interruption insurance
• Reimbursement for travel delay
• Travel accident insurance
• Travel and emergency assistance services
• Special benefits at The Luxury Hotel & Resort Collection, such as free room upgrades, early check-in and late check-out
• Evacuation and emergency transport
• Medical and dental emergencies

Learn more about the specific terms of each benefit.

This card includes a fairly high annual fee of $ 550. Therefore, it is not for everyone. You will be required to pay the annual fee on the first statement and then on each subsequent anniversary of the account. You can eliminate the annual fee during the year by getting rewards and taking advantage of the benefits mentioned above.

There is no introductory 0% APR period for this card, so it should not be used to fund new purchases or complete balance transfers. The APR is typically 16.99% to 23.99% variable in purchases and balance transfers.

This card has no fees for foreign transactions, so you can travel and spend outside the United States without incurring the average 3% rate.

If you are a frequent traveler, the Chase Sapphire Reserve card can be a useful addition to your wallet. To offset the $ 550 annual fee, you’ll need to make the most of the card’s benefits, from the $ 300 annual travel credit to Lyft, DoorDash and Peloton benefits. That said, this card has a robust set of benefits ranging from travel insurance and statement credits in eligible expenses to up to 50% value added on certain reimbursement rewards.

But if you don’t want to win more than $ 550, consider the Chase Sapphire Preferred® card more affordable. This card has an annual fee of $ 95 and still offers a 25% increase in eligible point refunds. In addition, you can benefit from many of the same travel and shopping protections, as well as credit offers with similar statements.