Do the benefits outweigh the $ 550 annual fee?

The Chase Sapphire Reserve® card was so popular when it was launched in 2016 that Chase experienced a shortage of the metal needed to make the card.

Since then, Sapphire Reserve has gained a loyal base of card members who have learned to enjoy the premium benefits of the card for travel – including a coveted $ 300 per year travel credit and free access to the airport’s VIP lounges.

Last year, the Sapphire Reserve card underwent several updates, especially when Chase raised its annual fee to $ 550. However, the card won a number of benefits with new partners like Lyft, DoorDash and Peloton that help balance the rate highest annual rate.

If you plan to start traveling again this year, consider adding this card to your wallet. Below, CNBC Select shares the Chase Sapphire Reserve rewards, benefits and fees, so you can decide if the card is worth it.

If you are a foodie or frequent traveler, this rewards program is geared towards you. You earn 3X points for travel and meals around the world and 1X points for all other purchases. Plus, earn 10X points on Lyft purchases by March 2022.

The welcome bonus is also excellent: earn 50,000 bonus points after spending $ 4,000 on purchases in the first three months after opening your account.

The Sapphire Reserve has two exclusive advantages that can maximize your points value by 50%:

1. Chase Ultimate Rewards® Portal: Simply use your points to book hotels, airline tickets, cruises and more directly through the travel portal.
2. Pay yourself back: Use this tool to redeem points for an extract credit for purchases at supermarkets, at dinners (including restaurants, take-away and eligible delivery services), at building supply stores (such as Home Depot and Lowes) and for contributions for a dozen eligible charities. Valid until April 30, 2021.

If you use any of these redemption options, the 50,000 point welcome bonus is worth up to $ 750.

CNBC Select has calculated how many rewards the average American can earn if they optimize the way they use the Chase Sapphire Reserve card. We work with the localization intelligence company Esri, who provided us with a sample of a $ 22,126 annual spending budget.

The budget includes six main categories: groceries ($ 5,174), gas ($ 2,218), dinner ($ 3,675), travel ($ 2,244), utilities ($ 4,862) and general purchases ($ 3,953).

See how many points you can earn with your Chase Sapphire Reserve card in each category:

• Groceries: 5,174
• Gas: 2,218
• Dining out: 11,024
• Travel: 6,733
• Utilities: 4,862
• General Purchases: 5,929
• Total: 35,940

If you redeem these points for travel via Chase Ultimate Rewards® or with Pay Yourself Back, you will receive a 50% bonus, which increases the approximate value from $ 359 to around $ 539 per year. (This does not take into account the annual fee or welcome bonus.)

When you count the $ 550 annual fee and the 50,000-point welcome bonus, your first year’s earnings drop to about $ 309 for regular redemptions, assuming 1 point is worth a penny. If you decide to redeem points through Chase Ultimate Rewards or Pay Yourself Back and receive 50% more in value, the amount rises to around $ 739. (That’s because the bonus is now worth $ 750, not $ 550.)

The Chase Sapphire Reserve card offers more than two dozen benefits for cardholders, which add additional value to the points highlighted above.

Many of the best benefits have a clear value of $ 60 to $ 300 each. When optimized, these benefits can help you more than offset the $ 550 annual fee.

Here are the main benefits:

• $ 300 annual travel credit to compensate for flights, hotel stays and more
• $ 100 credit for the global entry fee / TSA PreCheck Every four years
• Courtesy DashPass (worth about $ 119) for at least one year (apply until December 31, 2021)
• Up to $ 120 credit on Peloton statement digital and full access subscriptions (sign up by December 31, 2021)
• $ 60 DoorDash Credit in 2021
• Complimentary year of Lyft Pink membership (worth about $ 239 per month), which includes a 15% discount on car trips, relaxed cancellations and priority airport transfers
• Priority Pass Select Lounge access (valued at $ 429), giving you access to more than 1,000 VIP lounges in more than 500 cities worldwide

In addition to these benefits, you can take advantage of useful travel and shopping coverage, such as:

• Protection for eligible purchases that have been lost or damaged
• Return protection on eligible items that the store will not accept back
• Extended warranty protection on eligible purchases
• Roadside assistance during travel in the USA and Canada
• Car rental collision damage waiver
• Baggage delay insurance
• Refund of lost luggage
• Travel cancellation / interruption insurance
• Travel delay refund
• Travel accident insurance
• Travel and emergency assistance services
• Special benefits at The Luxury Hotel & Resort Collection, such as free room upgrades, early check-in and late check-out
• Emergency evacuation and transport
• Medical and dental emergency

Learn more about the specific terms of each benefit.

This card comes with a rather exorbitant annual fee of $ 550. Therefore, it is not for everyone. You will need to pay the annual fee on your first statement and then every subsequent account anniversary. You can save on the annual fee during the year by winning prizes and enjoying the benefits mentioned above.

There is no 0% APR introductory period for this card, so it should not be used to finance new purchases or complete balance transfers. APR is typical of 16.99% to 23.99% variable in purchases and balance transfers.

This card has no foreign transaction fees, so you can travel and spend outside the U.S. without incurring an average fee of 3%.

If you are a frequent traveler, the Chase Sapphire Reserve card can be a useful addition to your wallet. To offset the $ 550 annual fee each year, you will need to make the most of most card benefits, from the $ 300 annual travel credit to Lyft, DoorDash and Peloton benefits. That said, this card has a robust set of benefits ranging from travel insurance and extract credit on eligible expenses to 50% of the extra value on selected premium redemptions.

But if you don’t want to shell out more than $ 550, consider the more affordable Chase Sapphire Preferred® card. This card has an annual fee of $ 95 and still offers a 25% increase in redemption of eligible points. In addition, you can benefit from many of the same protections for travel and shopping, as well as similar credit offers on the statement.