Is the annual fee on the Chase Sapphire Reserve card worth it?

Up until recently the only travel card I had was the United Explorer Plus card.  It gave me extra miles for purchases, free baggage on United flights, and the ever-popular Excursionist Perk.  I had perused the miles forums and noticed that all the experts were getting cards like the Chase Sapphire Reserve or the Amex Platinum, but I had trouble swallowing the idea of $550 a year annual fee.

Recently though I took the plunge and it turns out, that in reality – the card isn’t going to cost me much more than my United Explorer card that has a $99 annual fee.  Actually, it’s ended up costing me less.  Let’s see how ….

Let’s look at the at the basic benefits of the card.  This card has a TON of benefits, but the first four are the benefits that are generally going to recoup the amount you spent on an annual fee.

• 50,000 in miles when you spend $4,000 in the first three months: Fortunately (or unfortunately) for me I average over $2,000 a month in credit card bills because I put EVERYTHING on my credit card to earn miles then immediately pay it off. 50,000 miles is equivalent to about $750 in airline tickets or hotel stays – which pays for almost two years of the card … but for purposes of this discussion I’m only going to count that money as a bonus, not toward my $450 annual fee.  If you don’t typically spend that much a month but are interested in the card wait until you have a big payment due such as car insurance or taxes and plan to get the card just before that, so you hit your minimum spend and earn those 50,000 bonus miles.
• $300 a year in travel credit: Any travel related purchases (airline tickets, hotels etc.) are reimbursed each year up to $300.  Me spending at least $300 a year on travel is a no brainer, so this drops my annual fee down to $250 right off the bat.
• TSA Pre-Check/Global Entry $100 credit: Chase will give you $100 credit every 4 years to put towards your Global Entry or TSA Pre-Check enrollment fees.  So, if this is something you’re considering, we’ve now dropped the annual fee down to $150 a year.
• Priority Pass Lounge Access: The card gives you and one guest access to more than 1000 lounges in 500 cities worldwide.  The cost to enter an airport lounge if you don’t have status with an airline averages about $50.  Now, without the card I typically wouldn’t pay for a lounge – but they do have a value when you use them.  All lounges are different, but they can have big comfy chairs with outlets at each seat, sleeping rooms, showers and other amenities.  Most lounges snacks and drinks, and many have buffets that are all free.   If you were to buy food at airport prices on your layover – you know a little salad can cost you $16 dollars.  The other part of the Priority Pass membership is that it not only works on lounges, but on some airport restaurants as well.  At each member restaurant you are entitled to $28 worth of food/beverage for yourself, and $28 worth of food/beverage for a guest.

So how does this translate to savings in real life?  On a recent trip to Morocco we flew MIA-MAD-RAK using American Airlines.  Since Miami is an hour away from where we live, we got to the Miami airport early and had lunch at Margaritaville in the airport along with an alcoholic drink.  The value of this meal was $56 dollars, but it was free because of the priority pass.  We flew from Miami to Madrid (8.5 hours), where we had a 3-hour layover.   We visited the Neptune lounge, which had a huge breakfast offering – donuts, bagels, pastries, fruits, sandwiches, drinks, desserts, coffees and alcohol.  We probably saved another $20 each eating the snacks and drinks in the lounge on our layover rather than buying something in the airport.  Not to mention we got to sit in comfy chairs and charge our devices while doing it.  On our way home we visited the Pearl Lounge in Morocco prior to our flight and had sandwiches and drinks for lunch which saved us another $20 each, then back through Madrid for additional $20 each.  The lunch buffet was phenomenal!  That’s $176 dollars in food saved on one trip – which paid for the remainder of my annual fee plus an extra $26.  With a few more trips planned throughout the year we’ll save even more.   Once you look at it this way, you can see why it might be ok to have a card with such a high annual fee.

So why get the card in the first place?  What benefits do you get for having it?

• Earn 3 miles per dollar on travel and dining: For folks that use miles to travel, you receive 3 miles per dollar on travel and dining compared to the 2 miles per dollar I earn on restaurants and hotels with my United Card. This lets the miles rack up faster.
• 50% more value when redeeming for travel: Ultimate Rewards points are usually worth 1 cent apiece. But Chase Sapphire Reserve® cardholders who redeem them for travel booked through Chase can get 1.5 cents per point. That gives you an effective rewards rate of 4.5% on travel and dining and 1.5% on other purchases.
• You can transfer points to a dozen airlines and hotels at a 1:1 ratio: I can use my points on several airlines including JetBlue, Southwest and British Airways and am not limited to United if I find a good deal elsewhere.
• No Foreign Transaction Fees: Some cards charge a 3% fee when used overseas, the CSR does not.
• Luxury Hotel Benefits: Cardholders staying at one of the high-end properties in Chase’s Luxury Hotel & Resort Collection can enjoy an array of perks: daily breakfast for two, free Wi-Fi, room upgrades when available, early check-in and late checkout, and a “special benefit unique to each property,” such as a spa package, restaurant credit or gift card.
• Cardholder Hotline: Chase Sapphire Reserve® customers get 24/7 access to a dedicated customer support line.
• Purchase Protection: When you buy something with your card, it’s covered against theft or damage for up to 120 days, for up to $10,000 per item and $50,000 per year.
• Return Protection: If you want to return something you’ve bought but the store won’t take back, you might be able to get reimbursed through Chase. The coverage is good for 90 days after purchase, up to $500 per item and $1,000 per year
• Point Pooling:  Most points card do not allow you to pool points, and it is a pain putting the tickets on different itineraries.  Chase allows you to pool points with those living in your household making it easier to reach your point goals. 

Many people get the CSR for the travel insurance protections alone.  When booking with your card you will receive:

• Rental Car Coverage: Pay for an auto rental with your card and decline the rental agency’s insurance coverage, and you’re covered for up to $75,000 against collision or theft. Coverage is primary — meaning you don’t have to involve your own insurance at all — and available both in the U.S. and abroad.
• Trip Cancellation or Interruption Insurance: Get reimbursed for up to $10,000 per person and $20,000 per trip if you have to cancel or cut short your trip because of sickness, weather and other covered situations. Reimbursement applies only to prepaid, nonrefundable travel expenses.
• Trip Delay Reimbursement: If your airline, train, bus or other ticketed travel experiences a delay that lasts more than six hours or requires an overnight stay, you’re covered for unreimbursed expenses up to $500 per ticket.
• Lost Luggage Reimbursement: This provides up to $3,000 of coverage per passenger if your checked or carry-on luggage is damaged or lost by the airline. Applies to the cardholder and immediate family members.
• Medical Emergencies During Travel: If you or an immediate family member get sick or injured while traveling and need an emergency evacuation, you can be covered for up to $100,000 for medical services and transportation.

CSR holders can book travel through the Chase Portal with either miles or cash, and in many cases CSR customers receive a discount so the price on the portal is cheaper than at the venue.  We recently splurged on a trip to the Maldives and decided that we wanted to rent an overwater bungalow (go big or go home lol!)  Overwater bungalows in the Maldives are CRAZY expensive on their own, but you also have to add in the price of transportation to the resort which could be a jet boat or sea plane ride and cost several hundred dollars on their own.  In our case we booked the newly opened all-inclusive Cinnamon Hakuraa Huraa resort for two nights through the Chase Portal which cost us $1700.  ($800 of that was the sea plane to the resort!)  When I went to the Cinnamon website, the same room cost $2416.  So, we saved $700 just by booking through the Chase Portal.  Not all bookings will save you this much, but there are some deals to be had.

 The bottom line is – don’t count the CSR out because of the annual fee – you may find that it’s worth it!