Why you’ll want to pay the $95 annual fee on the Chase Sapphire Preferred

14.05.2024 - 20:03 / thepointsguy.com / Chase Sapphire-Preferred

The Chase Sapphire Preferred® Card is one of the best travel credit cards on the market — whether you're a beginner to the world of points and miles or a seasoned pro.

While the card's annual fee is $95, there are plenty of reasons you might not mind paying it. Not only does the card earn valuable Ultimate Rewards points that can be transferred to more than a dozen airline and hotel partners, but it also has some other value-added perks and some of the best travel and purchase protections around.

That's why you might want to consider it instead of one of the many other starter travel cards with no annual fees.

Here's how you can potentially get much more value from the Chase Sapphire Preferred than it costs to carry each year.

Generally, cards with annual fees also come with higher sign-up bonuses. While you shouldn't make a habit of applying for cards purely for the sign-up bonus when you don't plan to keep it long-term, it can be a great perk that helps offset the first-year cost of a card.

The Sapphire Preferred currently offers 75,000 bonus Ultimate Rewards points after you spend $4,000 on purchases in the first three months from account opening.

TPG values 75,000 Ultimate Rewards points at $1,538 because of the program's array of transfer partners. Even if you're not maximizing your redemptions and only getting 1.25 cents per point in value by redeeming directly for travel purchases made through Chase, that's still $938.

Related: Chase Sapphire Preferred credit card review

Speaking of which, Chase Sapphire Preferred cardholders get what amounts to a 25% bonus on their points when redeeming them specifically for travel bookings made through Chase Travel℠. Points redeemed this way are worth 1.25 cents instead of just 1 cent.

Let's say you book a flight for $500. If you're using a cash-back card or one that offers points redemptions at 1 cent apiece, that flight will cost you 50,000 points. However, if you have the Chase Sapphire Preferred and book the same $500 flight through Chase Travel℠, it will only cost 40,000 points. The 10,000 points you save by having the Chase Sapphire Preferred are worth more than the card's annual fee.

Finally, on each account anniversary, you'll earn bonus points equal to 10% of your base earnings on total purchases made in the previous year. That means if you spend $25,000 on purchases, you'll get 2,500 bonus points.

Related: How to redeem Chase Ultimate Rewards points for maximum value

Chase Sapphire Preferred cardholders also receive up to $50 in statement credits each account anniversary year for hotel stays purchased through the Chase Travel portal. To utilize this perk, log into the Chase Ultimate Rewards portal, and if you have multiple Chase cards, make sure