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My go-to travel credit card costs $450 a year, but I consider its value to be unbeatable

Oct 3, 2019, 02:21 IST

Caroline Lupini in Fernando de Noronha, Brazil, in February 2019.Courtesy of Caroline Lupini

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  • I pay $450 a year for the Chase Sapphire Reserve, but I'm happy to do it - I think it's more than worth the cost.
  • For one thing, its effective fee is more like $50 a year once you take into account a $300 rebate you get for spending on travel.
  • Also, the Sapphire Reserve is packed with a laundry list of benefits and perks, from airport lounge access to lost and delayed baggage coverage. It's my favorite travel card by far.
  • Read more personal finance coverage.

When Chase introduced the Sapphire Reserve, it led the pack in virtually every category.

These days, it's a solid, well-rounded card, and it's my favorite travel card. You won't rack up as many points in through category bonuses as the competition, but if you look beyond the points offered, this card really shines.

When you look at the overall picture, for me, Chase offers the best value for travel rewards. However, this isn't an easy card to get. In addition to being subject to the normal Chase 5/24 rule, an exceptional credit history is required when applying outright.

This card comes with a minimum $10,000 credit line, and Chase is fairly conservative in the credit limits it issues.

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The annual fee is $450 - but its effective fee is more like $50

The annual fee is $450 per year, but the effective annual fee is as little as $50. This is because the card rebates $300 of your annual fee when spent on travel. This rebate is automatic and immediate. It doesn't require filling out a claim form, and it's not dribbled out monthly, limited to specific merchants, or infected with any of the annoying games played by the competition. It's a clean, honest $300 rebate.

Chase has a similarly clean, honest $100 Global Entry fee rebate meaning the effective annual fee is as little as $50 in the first year. This is unbeatable value.

The Sapphire Reserve gets me Priority Pass Lounge Access

The Chase Sapphire Reserve includes Priority Pass Select membership. It comes with no limitations on the Priority Pass venues you can enter (meaning it does work in certain restaurants as well as airport lounges).

I get bonus points on everything from food trucks to parking meters

It's the elephant in the room: points earning with the Chase Sapphire Reserve is anemic compared to the competition. Chase offers 3 Ultimate Rewards points per dollar spent on travel and dining (excluding the $300 travel credit), and one point per dollar on everyday spending. This may seem low compared to the competition.

However, Chase has an exceptionally generous definition of "travel" which includes everything from toll passes to parking meters. The same is true with restaurants; my spending is bonused on everything from food trucks to drive-throughs. I'm not earning 4x or 5x points, but I'm not playing bonus roulette: I reliably receive the bonuses, everywhere in the world, even in places I wouldn't expect.

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The Sapphire Reserve has a long list of benefits

Chase has a massive slate of card benefits with the Sapphire Reserve - some you wouldn't expect, like towing coverage (not just for a rental car, but for your personal vehicle), trip interruption coverage, lost or delayed baggage coverage, and primary rental car collision coverage - even on expensive and exotic cars worth up to $75,000.

There are all the benefits you'd expect, too (like no foreign transaction fees). That's just a sampling - the number of benefits this card has is truly massive and they actually work. Chase does pay claims (although it will only pay claims on what's really covered, so be sure to keep your expectations realistic and call if you have any questions).

Like most card issuers, Chase has trimmed around the edges of its benefits, but it hasn't touched core travel-related benefits which are their biggest competitive advantage.

The customer service is exemplary

When you call Chase and are a Reserve cardholder, there's no phone tree. There's no wait. There is no offshore call center. 24 hours a day, you immediately reach a well-trained, well-educated banker in the United States who can actually do and fix things versus just reading a script. Honestly this is so refreshing compared to the competition it's worth highlighting. When you carry this card, Chase magically makes stuff just work.

You can spend Ultimate Rewards like cash when you want to buy

Like points earning, Ultimate Rewards is a middle-of-the-road program. Points transfers are available, but have much less value than in the past. Nearly all of Chase's primary airline partners have devalued their programs (a bit in some cases, massively in others), and so has their best hotel partner (Hyatt).

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The upside? Cash airfares have come down, and you can spend Ultimate Rewards points like cash toward paid flights at a respectable 1.5 cents per point. If you're buying a discounted business class fare it can cost fewer Ultimate Rewards points these days, when spent this way, versus even what a "saver" award used to cost in an airline program. Plus, flights purchased directly with Ultimate Rewards points are considered revenue fares by the airline, so they can earn miles and points in the airline's loyalty program.

If you can't qualify, start with the Chase Sapphire Preferred Card

The Chase Sapphire Reserve is a tough card to get. However, there is a "back door" way to get it: apply for the Chase Sapphire Preferred (which comes with a minimum $5,000 credit line), and then try to upgrade after a year of holding the card. After a year of good credit history with Chase, the company is often amenable to this. If you don't plan to spend your welcome bonus immediately, this can be a good strategy anyway.

The Chase Sapphire Preferred offers a 60,000 Ultimate Rewards welcome bonus (versus the 50,000 Ultimate Rewards welcome bonus offered to Chase Sapphire Reserve customers) after you spend $4,000 on purchases in the first three months, and has a lower $95 annual fee. Assume this is what you'll be paying; it is rarely waived and there are no rebates like with the Sapphire Reserve.

Chase isn't offering flashy, headline-grabbing bonuses. To do that, it would have to trim benefits and play games elsewhere. Instead, it has chosen not to do this and to keep the Sapphire portfolio largely the same. I gladly pay my annual fee every year, and this card is at the top of my wallet, because it delivers solid, reliable, and premium value that I just don't have to think about.

Learn more about the Sapphire Reserve from our partner The Points Guy »

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