Chase announced a number of significant changes to its Sapphire Reserve premium credit card, including increasing its annual fee from $450 to $550. They also added a few new benefits like the Lyft Pink membership and DoorDash credits. Today, we’ll go over the revised product and answer the question: Is the Chase Sapphire Reserve still worth it?
What is the Chase Sapphire Reserve?
Chase Sapphire Reserve is a premium credit card that was launched in 2016 to compete with American Express’ Platinum card. If you somehow missed the credit card wars that started a few years ago, card carriers have been viciously fighting each other to be the card of choice for consumers.
In my opinion, there are only 3 cards I consider to be a premium credit card:
- American Express Centurion (Black Card): $10,000 first year fee, $2,500 annual fee
- American Express Platinum: $550 annual fee
- Chase Sapphire Reserve:
$450now $550 annual fee
Now, there’s a sizable amount of people that would never pay an annual fee to use a credit card, let alone ones that charge several hundred dollars or a few thousand dollars.
It depends on each person’s circumstances, but you shouldn’t get one if you can’t take advantage of its benefits. It would just be a waste of money. Personally, I have these cards because they pay me $1,000 every time my flight is delayed and they give me the ability to earn millions of points.
Existing Benefits of Sapphire Reserve
I can’t answer whether or not the Chase Sapphire Reserve is still worth it without reviewing the existing benefits that will not be going away.
These benefits are significant and a major reason why this card is so popular in the first place. The ones I listed below are the highlights and not meant to be an all-inclusive list:
50,000 Points Welcome Bonus
When the Sapphire Reserve card first launched, it offered an outrageous 100,000 points sign-up bonus (Chase Ultimate Rewards points). I don’t think that will ever happen again. In fact, it was so popular that Chase ran out of raw materials to make these metal cards!
Customers who apply for the card now will get 50,000 points after spending $4,000 in the first 3 months from account opening. I value each Chase point to be worth 1.5 cents, so the 50,000 sign-up bonus is worth $750.
$300 Annual Travel Credit
I view this as the best benefit the Sapphire Reserve card has to offer.
Chase will credit you $300 a year for any travel-related expenses charged to the card. The travel category is very broad too so most people will have no trouble in using it. You can use the credit for things like:
- Air (airfare, travel agencies, upgrades, baggage fees, cancel fees)
- Hotel (hotels, motels, timeshares, campgrounds)
- Vehicle Rental (cars, buses, limousines)
- Parking (parking lots, garages)
- Transport (subways, trains, ferries, commuter rail)
- Taxi (traditional, Uber, Lyft)
These are examples on just how easy you can use the travel credits. I usually reach the $300 credit by the end of January of every year.
Here’s how the travel credits will show up on your credit card statement:
3X Points on Travel & Dining
All your travel and dining expenses will earn 3X the amount of Chase Ultimate Rewards points – anywhere in the world.
If you spend a good amount of money on travel or dining, the triple points really help in boosting your Chase points balance.
Trip Delay Reimbursement
You get to airport, check your bags, go through security, and head over to your gate. The screen says there’s only 30 minutes left before boarding, but uh oh – the flight status just changed to “delayed” and another 30 minutes get added to the estimated departure time.
Then another 30 minutes…
And then another hour…
If you’re really unlucky, your evening flight got cancelled and now you’re re-booked for the next morning.
Does this sound familiar?
Enter your superhero! Is it a bird? Is it a plane? Is it even Superman? No?!?
It’s your Chase Sapphire Reserve card! With this card, Chase will cover you for unreimbursed expenses, up to $500 per ticket, for flights delayed more than 6 hours or ones that require an overnight stay.
I wrote about how my wife and I got stuck overnight in Washington, D.C. last year. We turned it from an inconvenience to a day-tour of our nation’s capital. Chase paid us $1,000 for the experience thanks for the trip delay benefit:
Chase will pay you $100 per day for up to 5 days if your luggage is delayed. This is another handy benefit I’ve taken advantage of. There’s been quite a few times where my bags didn’t make the same flight I was on. I use this benefit to buy things like a toothbrush, shaver, pajamas, and a change of clothes for the next day.
Did you ever buy something and accidentally broke it? Or maybe it was stolen at a social event?
Calling all damaged and stolen iPhones!
Well, Chase’s Purchase Protection will reimburse you against damage and theft up to $10,000 per incident.
So go ahead, drop that phone in the toilet 🙂
I’m kidding! But when those oopsie moments happen, you can ease your mind that it’s not the end of the world.
There’s probably been a time where you bought something and had buyer’s remorse. Perhaps you’ve used it once or twice, but quickly realized it wasn’t for you. What if the store doesn’t take it back?
Chase will allow you to return it to them and they will reimburse you for the cost of the purchase, up to $500 per item.
Priority Pass Airport Lounge Access
Most people arrive at the airport early to make sure they don’t miss their flights. Sometimes it’s too early. Do you really want to wait by the gate in those uncomfortable chairs?
Of course not.
Relax in one of the 1,200+ Priority Pass lounges instead. Most of them aren’t swanky ones with fine champagne like the airline-owned lounges, but they’re plenty comfortable with free food and drinks, like this one in Kiev:
Global Entry or TSA Pre Fee Credit
Chase will pay for your Global Entry or TSA Pre application fee and every time you need to renew it too.
Global Entry is great for international travelers because it allows you to literally walk through U.S. immigration when you come home. All you do is scan your hand on a machine and off you go!
TSA Pre lets you go through security without taking your shoes off and taking things out of your bags. It also saves you time because most airpoirts have special lines for people with TSA Pre. Note that this is for domestic flights only.
Global Entry is more valuable because of the benefits when arriving home from an international destination, but it includes TSA Pre benefits too.
New Sapphire Reserve Benefits
1 Free Year of Lyft Pink
Chase is offering card members a complementary year of Lyft Pink. Lyft Pink has the following benefits:
- 15% off all Lyft rides
- Priority airport pick-ups
- 3 free cancellations per month
- 3 free bike and scooter rides per month
- No lost and found fees
The membership for Lyft Pink is $19.99 a month, so this benefit has a minimum value of $240. Depending on how many Lyft rides you take, the savings can be a lot more.
You have until March 31, 2022 to activate your free year, giving you plenty of time to decide when to begin using Lyft Pink. To maximize the value of this benefit, start your free year right before you think you’re going to use it the most.
10X Points on Lyft
You’ll earn 10X the amount of Chase points for all your Lyft rides until March 2022. That’s 7X more points added on top of the 3X points you already earn on travel.
2 Free Years of DashPass
DashPass provides DoorDash customers unlimited restaurant deliveries with a $0 delivery fee and reduced service fees on orders of $12 or more.
DashPass costs $9.99 a month so 2 free years of this are worth almost $240.
$120 DoorDash Statement Credits
In addition to the DashPass, Chase will also give you $120 in free credits to use with DoorDash. You’ll get $60 now till the end of 2020 and then another $60 in 2021 The credits can be used all in the same month (no per month cap).
Is the Chase Sapphire Reserve still worth it?
This is a tricky question to answer.
Don’t get me wrong, the new benefits are great. These aren’t useless offerings; both Lyft and DoorDash are popular services that a lot of people use.
However, I see two shortcomings from this:
- Not everyone lives in or near a major city. Lyft and DoorDash are definitely more valuable in cities due to the availability of the services and general value you can get out of them.
- While the benefits are incredible, they’re both temporary. Once 2022 rolls in, kiss them goodbye.
Here’s how I see it.
Before, you really only paid $150 annually in order to use the card. I know, I know… the annual fee was $450, but it was offset by the easy-to-use $300 in annual travel credits.
With the new annual fee of $550, I’m really paying $250 a year for it ($550 annual fee minus $300 in annual travel credits).
With the baseline established, we need another card to compare the differences.
Sapphire Reserve vs Sapphire Preferred
Instead of this card, I could get the very similar Chase Sapphire Preferred that charges an annual fee of $95 (a difference of $155 from the Sapphire Reserve). Although they’re alike, the main difference is the Sapphire Preferred does not have the $300 in annual travel credits and it earns 2X points on travel & dining instead of 3X (I value each point at 1.5 cents).
Now the real question than becomes:
Do I get more than $155 in benefits and rewards?
The calculation is relatively straightforward in order to see if the additional $155 is worth it:
Additional Annual Fee on Sapphire Reserve: $155
Value of Additional Points Earned with Sapphire Reserve: 1.5 cents
Calculation: $155 / $0.015 = $10,333
This means that if you spend at least $10,333 on travel & dining purchases in a year, you’re better off going with the Sapphire Reserve. This breaks out to $861 per month.
Here are the calculations that prove this out:
$10,333 x 3 points per dollar = 31,000 Ultimate Rewards points
31,000 x 1.5 cents = $465
$10,333 x 2 points per dollar = 20,666 Ultimate Rewards points
20,666 x 1.5 cents = $310
The difference between $465 and $310 is $155, which is the additional annual fee cost for the Sapphire Reserve.
The Bottom Line
I have a strong suspicion that Chase offered the new benefits to help people feel better about the increased annual fee. Maybe they’re worried too many people would cancel their cards and gave these goodies as a peace offering.
Is it enough to justify the extra $100?
Short-term = Yes
Especially if you can make moderate use of either Lyft or DoorDash. All it takes if a few airport rides or meals delivered to your house to make up for the extra $100.
Long-term = Tough to justify
You’d have to look at how you typically use your Sapphire Reserve because not everyone will be able to spend $861 a month on travel and dining categories. It’s better to switch to the less expensive Sapphire Preferred if you aren’t at that level.
I’m keeping it because I use too many of its benefits to my advantage. Not only do I eat out and travel a lot, I like the peace of mind the Sapphire Reserve affords me if my trip is delayed or if my baggage is lost. While the Sapphire Preferred also has these benefits, there are more restrictions tied to them.
What about other ninjas out there? Are you staying with the Chase Sapphire Reserve or does the increased fee make you run towards the American Express Platinum card instead?