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Is the Chase Sapphire Preferred Worth the Annual Fee? Yes! Here’s What Makes This Card a Keeper

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Is the Chase Sapphire Preferred Worth the Annual Fee? Yes! Here’s What Makes This Card a Keeper

Andrew WanIs the Chase Sapphire Preferred Worth the Annual Fee? Yes! Here’s What Makes This Card a KeeperMillion Mile Secrets Team

Signing up for credit cards through partner links earns us a commission. Here’s our full Advertising Policy.

INSIDER SECRET: Instead of using your Chase Ultimate Rewards points for cash back, transfer them to Chase’s travel partners to get even more value. 

It’s hard not to come out as a winner if you carry the Chase Sapphire Preferred Card in your wallet. There’s an extra reason we consider it the #1 first credit card for beginners — its great perks.

Team member Scott, for instance, has had the card for over five years, using it regularly on his travels across the US, Canada, Mexico, Caribbean and Europe.

Plus, right now you can earn 60,000 Chase Ultimate Rewards points after you spend $4,000 on purchases in the first three months from account opening.

That’s worth $750 toward travel when you redeem through the Chase Ultimate Rewards travel portal, and enough to cover the annual fee of $95 many times over. The card also carries other perks that make the Chase Sapphire Preferred annual fee worth it in the long run.

Is the Chase Sapphire Preferred annual fee worth it? If you travel at all, it absolutely is. In fact, you could find yourself flying in first class sooner than you think, thanks to this card. (Photo by Brostock/Shutterstock)Here are just a few reasons why this card should be in your wallet.

The Chase Sapphire Preferred Annual Fee Is Worth It

Apply Here: Chase Sapphire Preferred Card 

Read our review of the Chase Sapphire Preferred

Right off the bat, you’ll have the opportunity to earn an intro bonus that’s more than enough to cover the card’s annual fee of $95. When you apply for the Chase Sapphire Preferred Card, you can 60,000 Chase Ultimate Rewards points (worth $750 in travel booked through the Chase Ultimate Rewards portal) after you spend $4,000 on purchases in the first three months from account opening.

You can actually get more than $750 in value from the card’s welcome bonus. That’s because the card earns rewards in the form of Chase Ultimate Rewards points, which you can transfer to Chase’s airline and hotel partners for potentially even more value.

And if you decide to keep the card long-term, you’ll also be treated to a number of great benefits, such as strong points-earning rates for many of your daily purchases, as well as a number of purchase protections.

Use the Chase Sapphire Preferred to Quickly Rack Up Rewards 

When you use the Chase Sapphire Preferred Card for your daily purchases, you’ll earn 2 points per dollar on travel and dining, and 1 point per dollar spent on all other purchases worldwide.

Chase’s definition of travel is pretty generous and includes airlines, hotels, Airbnbs, car rentals, campgrounds, cruises, travel agencies, trains, taxis, ferries, toll bridges, parking lots, and more.

And you can earn 2x points per dollar spent on dining as long as the establishment codes their sales as a restaurant, which often includes bars, nightclubs and fast food places worldwide.

Stretching the Value of Your Rewards Thanks to Flexible Ultimate Rewards Points

The Chase Sapphire Preferred Card earns rewards in the form of flexible Chase Ultimate Rewards points. You can redeem for cash back or travel through the Chase Travel Portal, or you can transfer the points to any of Chase’s travel partners.

Cash-back redemptions will yield a value of 1 cent per point.

You can do a bit better redeeming through the Chase Travel Portal, as you’ll get 25% more value than a cash-back redemption (1.25 cents per point).

But to get the most value from Chase Ultimate Rewards points, transfer your points to any of Chase’s transfer partners, which include:

Real-world example: I transferred 90,000 Chase Ultimate Rewards points to Hyatt (the best Chase hotel transfer partner) at a 1:1 ratio and booked three nights at the Park Hyatt New York earlier this year. I paid nothing out of pocket for a stay that otherwise would have cost nearly $3,000! Needless to say, I was pretty happy to get more than 3.33 cents per point in value.

At $1,000 a night, I never thought I’d be able to afford to stay at the Park Hyatt New York. But thanks to points earned on my Chase credit cards, I was able to stay not one, not two, but three nights with no cash out of my pocket. (Photo by Inspired By Maps/Shutterstock)

Excellent Purchase Protections for Your Purchases

With the Chase Sapphire Preferred Card, you’re protected by a number of purchase protections which can potentially save you many hundreds of dollars, such as:

  • Extended warranty protection: Extends the time period on eligible original manufacturer’s written US repair warranties by one additional year on eligible warranties of three years or less, up to a maximum of $10,000 per claim and a $50,000 maximum per account.
  • Purchase protection: Covers eligible items of personal property you purchase in the event of theft, damage, or involuntary and accidental parting with property within 120 days of original purchase, up to a maximum of $500 per claim and a $50,000 maximum per account.

Real-world example: I’ve personally used the extended warranty protection on my credit cards, which once saved me from a repair bill  of several hundred dollars when I needed a new keyboard for my laptop.

Premium Travel Protection

This wouldn’t be a great travel card for miles-and-points enthusiasts if it didn’t also come with perks to help with your travel plans. The Chase Sapphire Preferred Card includes the following coverages:

  • Primary rental car insurance: Covers damage due to theft or collision when you pay for the rental with your card.
  • Trip delay reimbursement: Provides up to $500 for each purchased ticket for reasonable expenses if your trip is delayed by more than 12 hours.
  • Trip Cancellation: Reimburses you or immediate family members for up to $10,000 if a covered loss prevents you from traveling on or before the departure date, resulting in cancellation of the travel arrangements.
  • Baggage delay insurance: Reimburses up to $100 a day for up to five days if your baggage is delayed by over six hours.
  • Roadside dispatch: Provides services such as towing, tire change, jump start, key lockout service, fuel delivery and standard winching.

The full details of the benefits described above are detailed in Chase’s Guide to Benefits.

Real-world example: Primary rental car coverage came in handy when team member Joseph rented a car in Ireland. Not only did he save $300 by turning down the rental agency’s insurance, he also didn’t have to worry about a thing when Avis tried billing him $2,300 for some damage to the car. Primary car rental insurance on the Chase Sapphire Preferred Card meant that Chase took care of everything.

Turn down ridiculously expensive insurance from rental agency? Check. Avoid a repair bill of thousands of dollars? Check. Just make sure to use your Chase Sapphire Preferred for your next car rental to avoid potential complications. (Photo by tommaso79/Shutterstock)

A Premium Version of the Chase Sapphire Preferred? 

Although the Chase Sapphire Preferred Card offers a lot of value for beginners and seasoned travelers alike, you can also consider the “bigger brother” version of the card, the Chase Sapphire Reserve, which comes packed with a few more perks.

Although the Chase Sapphire Reserve carries a much higher annual fee of $450, it also provides a number of added perks and benefits to make it well worth the added expense, such as:

  • Up to $300 annual credit every card member anniversary year for travel purchases
  • $100 statement credit for Global Entry
  • Complimentary Priority Pass Select membership for access to airport lounges
  • And much more

Chase has some pretty strict application rules, so you can’t have both cards. You’ll have to choose between either the Chase Sapphire Preferred Card or the Chase Sapphire Reserve. Also, both cards are subject to the Chase 5/24 rule, which means if you’ve opened five or more cards (from any bank, excluding certain business cards) in the past 24 months, you won’t be approved.

If you’re not sure which one is right for you, you can read our full review of the Chase Sapphire Reserve.

Bottom Line

Whether you’re new or a seasoned traveler, it’s easy to come out ahead as a winner on the Chase Sapphire Preferred Card.

You can earn an intro bonus of 60,000 Chase Ultimate Rewards points after you spend $4,000 on purchases in the first three months from account opening. That’s worth $750 in travel through the Chase Travel Portal. And because you earn rewards in the form of flexible Chase Ultimate Rewards points, you can transfer points to Chase’s airline and hotel travel partners for potentially even more value.

As a card member, you’ll also be able to take advantage of strong earning rates for everyday spending, in addition to a number of purchase and travel protections.

So between the intro bonus, ongoing perks and earning lots of points for your daily purchases, the Chase Sapphire Preferred Card is hands-down totally worth the $95 annual fee.

For more about Chase Ultimate Rewards points, take a look at these guides:

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Editorial Note: We're the Million Mile Secrets team. And we're proud of our content, opinions and analysis, and of our reader's comments. These haven’t been reviewed, approved or endorsed by any of the airlines, hotels, or credit card issuers which we often write about. And that’s just how we like it! :)

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I had been a Reserved card holder for more than 2 years. If I downgrade to Preferred card, will I ge the intro bonus of 60,000 points?

Author

Unfortunately no. If you downgrade, you won’t be eligible for the welcome bonus.

So, I’ve been a Preferred card holder for going on 10 years now. I am starting to travel for work quite a bit and think I want to instead use the Reserve card as my primary card…but I know I can’t hold both.

Does anyone know if it’s possible to downgrade my Preferred to say the Freedom (to keep the history, but not the annual fee) and then apply for the Reserve as a fresh card (to score the big upfront bonus)?

I don’t want to upgrade right from Preferred to Reserve because I’d miss out on the initial bonus…but is that the only way to protect my current Ultimate Rewards balance? I’m a little concerned about what restrictions exist by going all the way down to the Freedom for what could be a month or two.

Author

Hi Gregory,

Yes that should be possible. I’ve read multiple reports online of people downgrading their Sapphire Preferred to the Freedom, and were able to retain the account history and rewards balance.

You should also be eligible for the welcome bonus on the Sapphire Reserve as well since you earned the last Sapphire bonus over 48 months ago.

The Chase Sapphire Preferred — is the $300 Travel Credit good toward purchasing… Airline Gift Cards?

Or even hotel gift cards?

Reserve has the $300 credit, not Preferred. You can use that for ANY travel; hotels, flights, taxes & fees on rewards flights, car rentals, anything coded as travel (but not gas). No need to bother with the airline gift cards, much easier to use than the cards that have airline incidentals credit.