To reflect the major changes that kicked in as of January 12, 2020, our review of Chase Sapphire Reserve has been updated, so as many other reviews that involve this popular card.
In a nutshell, the changes for Sapphire Reserve are as the following:
As we can see the new Lyft and DoorDash perks, which might be useful to some customers, are sort of temporary to mitigate the annual fee increase. We think in general this card was devaluated. Considering the easy-to-use $300 annual credit, the effective annual fee is increased from $150 to $250. In order to cancel that out and beat the benchmark 2% cashback provided by several non-fee cards such as Citi Double Cash and Fidelity Visa, the minimum spending on the 3x categories (dining & travel) is increased from $6,000 to $10,000, with our valuation of Chase Ultimate Rewards points at 1.5 cents a piece, because $6,000 x 3 x 1.5% = $6,000 x 2% + $150 while $10,000 x 3 x 1.5% = $10,000 x 2% + $250.
When compared to another Chase card that offer flexible miles/points transfer feature - Sapphire Preferred which carries a $95 annual fee and offers 2x points on dining & travel, you need to spend $10,500 per year on dining & travel to cancel out the effective annual fee difference, because $10,500 x 3 x 1.5% - $250 = $10,500 x 2 x 1.5% - $95. Previously, you only need to spend $3,700t on dining & travel to cancel out the difference in effective annual fees, and that was why it was an easier recommendation to get the seemingly more expensive Sapphire Reserve. Now you really need to figure out if you could spend that much in those categories and how much you value the extra perks and protection provided by Sapphire Reserve. Another factor to consider is that Sapphire Reserve is still a better card for Ultimate Rewards ecosystem (we always recommend comparing it with the non-fee Freedom Unlimited to get best out of this ecosystem), as in addition to the flexible miles/points transfer feature it does offer a better fixed travel redemption option at 1.5 cents when you book through Chase.
All in all, it is not as easy as before to recommend Chase Sapphire Reserve, but for cardholders who spend enough on dining & travel and/or value excellent travel perks such as airport lounge access, luxury hotel privileges, primary rental car insurance, premium roadside assistance, the best travel & consumer protection provided by any credit card, and the ultimate flexibility in redeeming points, this card still represents great value. After number crunching, Sapphire Reserve maintains the No.1 spot on our Top 10 Best Credit Cards list, for now.
In a nutshell, the changes for Sapphire Reserve are as the following:
- The annual fee for primary cardholder is increased from $450 to $550, which seems an industry wide trend (Amex Platinum is $550, Amex Delta Reserve will soon be $550, Citi Prestige is $495, ...)
- One year Lyft Pink membership - activate before March 31, 2022. Lyft Pink (valued at least $199 on paper) offers 15% off every car ride, priority airport pickups, relaxed cancellations, and exclusive savings;
- 10x points on Lyft purchases through March 2022, i.e., 7 additional points over the 3 points on regular travel;
- One year DoorDash subscription service for free - activate before December 31, 2021. This subscription service offers $0 delivery fee and reduced service fees on food orders over $12 via DoorDash;
- Receive $60 statement credits for DoorDash purchases through December 2020 and another $60 through December 2021;
As we can see the new Lyft and DoorDash perks, which might be useful to some customers, are sort of temporary to mitigate the annual fee increase. We think in general this card was devaluated. Considering the easy-to-use $300 annual credit, the effective annual fee is increased from $150 to $250. In order to cancel that out and beat the benchmark 2% cashback provided by several non-fee cards such as Citi Double Cash and Fidelity Visa, the minimum spending on the 3x categories (dining & travel) is increased from $6,000 to $10,000, with our valuation of Chase Ultimate Rewards points at 1.5 cents a piece, because $6,000 x 3 x 1.5% = $6,000 x 2% + $150 while $10,000 x 3 x 1.5% = $10,000 x 2% + $250.
When compared to another Chase card that offer flexible miles/points transfer feature - Sapphire Preferred which carries a $95 annual fee and offers 2x points on dining & travel, you need to spend $10,500 per year on dining & travel to cancel out the effective annual fee difference, because $10,500 x 3 x 1.5% - $250 = $10,500 x 2 x 1.5% - $95. Previously, you only need to spend $3,700t on dining & travel to cancel out the difference in effective annual fees, and that was why it was an easier recommendation to get the seemingly more expensive Sapphire Reserve. Now you really need to figure out if you could spend that much in those categories and how much you value the extra perks and protection provided by Sapphire Reserve. Another factor to consider is that Sapphire Reserve is still a better card for Ultimate Rewards ecosystem (we always recommend comparing it with the non-fee Freedom Unlimited to get best out of this ecosystem), as in addition to the flexible miles/points transfer feature it does offer a better fixed travel redemption option at 1.5 cents when you book through Chase.
All in all, it is not as easy as before to recommend Chase Sapphire Reserve, but for cardholders who spend enough on dining & travel and/or value excellent travel perks such as airport lounge access, luxury hotel privileges, primary rental car insurance, premium roadside assistance, the best travel & consumer protection provided by any credit card, and the ultimate flexibility in redeeming points, this card still represents great value. After number crunching, Sapphire Reserve maintains the No.1 spot on our Top 10 Best Credit Cards list, for now.
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