Review: Chase Sapphire Preferred benefits are worth the $95 annual fee

With so many great travel rewards credit cards out there, picking the right one can be tough. The Chase Sapphire Preferred is a longtime favorite of travelers looking to earn rewards points redeemable for plane tickets, hotel nights, cruises, trains, and other travel adventures.

This card offers 2 points per dollar spent on travel and dining purchases and 1x point everywhere else. The card currently offers a 60,000-point sign-up bonus after you spend $4,000 on purchases within three months of opening a new account. While the card carries a $95 annual fee, it’s easy to earn that back and more in rewards and benefits.

Let’s take a deep dive look at the Chase Sapphire Preferred so you can decide if it makes sense for your purchase and travel needs.

Annual fee and other charges

It is easy to see how you can get $100 or more in value from this card every year, but it isn’t free. The Sapphire Preferred card charges a $95 annual fee.

Chase Sapphire Preferred charges variable rate interest. The card currently charges 18.24% APR to 25.24% APR based on your credit history and market rates. Rates can change at any time.

Balance transfers have the same interest rates as purchases plus a 5% fee ($5 minimum) per occurrence. Cash advances charge a higher 27.24% APR plus 5% ($10 minimum) per occurrence. Late and returned payments cost up to $39 each.

Bonus categories

Right out of the gate, you’ll earn 60,000 bonus points after spending $4,000 in the first three months after opening a new account. When you redeem those points for travel through the Chase Ultimate Rewards portal, that’s worth $750 in free travel to get you started.

From the first dollar you spend, you’ll earn 2 points per dollar on purchases from travel and dining merchants. That includes airlines, hotels, discount travel sites, cruise companies, fancy restaurants, fast food, and most bars. Hello 2x points at happy hour! You’ll earn 1 point for every dollar you spend everywhere else.

This is less than you get from the ultra-premium Chase Sapphire Reserve, the upgraded version of this card that offers 3x points on travel and dining along with other premium benefits. However, Chase Sapphire Reserve has a higher $450 annual fee.

Chase Ultimate Rewards points, the rewards currency of Chase Sapphire cards, are worth 1 cent each by default when redeemed through the Ultimate Rewards portal. With the Chase Sapphire Preferred, you get 25% more value, or 1.25 cents per point.

Read more: 7 reasons to open the Chase Sapphire Preferred — even though the card doesn’t come with as many flashy perks as the Sapphire Reserve

Using points for maximum value

You can redeem points for travel at the 1.25-cent rate with no limits or blackout dates. The redemption system searches many airline and hotel brands, with a similar feel and layout to major discount travel websites.

If you want to get even more value per point, however, you can transfer to a list of transfer partners at a 1:1 ratio. That means 1 Chase point equals 1 point or mile with all these programs.

Airlines include:

• Aer Lingus
• Air France/KLM
• British Airways
• Iberia
• JetBlue
• Singapore
• Southwest
• United
• Virgin Atlantic

Hotel partners include:

• IHG
• Marriott
• World of Hyatt

You generally get the best value per point transferring to airlines and booking premium travel, like a first-class flight or a hotel stay that would cost hundreds of dollars. Also keep in mind that many transfer partner airlines are members of alliances that give you additional partner airline choices.

When you get a good deal, you can book a domestic round-trip flight for 25,000-points. With British Airways, you can book many short-haul flights on partner American Airlines for even fewer points. Southwest also offers many great deals with no checked baggage fees for your first two bags.

Depending on your travel preferences, you may be able to get quite a bit of value from each point. You typically get the worst value using points for purchases. Gift cards and cash back also offer sub-par value compared to using points for travel.

If you earn the 60,000-point bonus on the Sapphire Preferred, you may be able to find an award flight for a free round-trip to Europe.

Read more: Chase offers bonus points or miles when you add authorized users to certain credit cards — adding your kid will help them build a credit history

Other Sapphire Preferred benefits

The Chase Sapphire Preferred gives you more than just valuable points. This card includes many additional features that come in handy when traveling and shopping at home, online, or anywhere your travels take you.

When you’re traveling outside of the United States, Chase Sapphire Preferred does not charge any foreign transaction fees. Foreign transaction fees are typically 3% to 5% of your purchase, so they can quickly add up if you don’t take the right card on your trips abroad.

The card also includes primary rental car damage insurance, which means it kicks in before your own car insurance and allows you to confidently pass up the extra charge of a car rental agency’s own insurance whenever you rent a vehicle and pay with the Sapphire Preferred.

Other perks include trip insurance, baggage delay insurance, trip delay reimbursement, and travel assistance. New purchases are also covered for 120 days against damage or theft, up to $500 per incident. The card also automatically extends manufacturer’s warranties by up to one year.

The bottom line

Chase Sapphire Preferred is one of the best cards with an annual fee around $100. The sign-up bonus alone is worth at least seven years’ worth of annual fees not taking into account other points you earn and other benefits.

On a personal note, I’ve had this card since March 2012 and have only considered getting rid of it to upgrade to the Sapphire Reserve. But for now, this one is still a staple in my wallet.

If you pay off your credit card in full every month, you won’t pay interest. If you can keep the card paid off and value travel, the Sapphire Preferred card is a great choice. It offers a good balance of cost and benefits that makes it a very popular choice. Depending on your spending and travel habits, it could be perfect for you.

Click here to learn more about the Chase Sapphire Preferred from our partner The Points Guy.