When the Chase Sapphire Preferred^® Card is Totally Worth the Annual Fee (And When It’s Not)

When you use a rewards credit card properly — that is to say, when you take advantage of all its perks and avoid carrying a balance from month to month — it can be quite valuable. But once you add an annual fee to the mix, it changes just how much value you can squeeze out of your card.

If you’re trying to decide on the best travel credit card and are considering the Chase Sapphire Preferred^® Card, you’re probably wondering if it’s worth the $95 annual fee. While the Sapphire Preferred is a consistently high-ranked travel card with a killer welcome offer, awesome perks, and 2X rewards on other travel purchases purchases, there’s still that pesky annual fee. And although it’s relatively low compared to other top travel credit cards, you are, in fact, paying a fee to use this card. So it better be worth it, am I right?

Here are 6 times it’s worth it to pay $95 for the Chase Sapphire Preferred.

6 times the Chase Sapphire Preferred annual fee is worth it

An annual fee essentially reduces the value of a credit card and paying it only makes sense if you’re able to offset the cost. You can do this by earning enough points to equal the cost of the card or by taking advantage of a card perk(s) that’s value equals the annual fee. So how much do you have to spend to make the Chase Sapphire Preferred worth it? More on that in a minute.

Spending wisely and utilizing the following perks can help ensure you’re getting your money’s worth. Here are 6 times this card’s annual fee is totally worth it.

1. You can comfortably earn the sign-up bonus

The Chase Sapphire Preferred offers one of the best sign-up bonuses available. New cardmembers can earn 60,000 bonus points after you spend $4,000 on purchases in the first 3 months from account opening from account opening. That’s worth $750 when redeemed for travel through the Chase Travel℠ portal.

As valuable as the sign-up bonus may be, it does require spending a fairly steep $4,000 within the first 3 months, which may prove difficult depending on your situation. Being able to comfortably earn the sign-up bonus is one thing; overextending yourself and making purchases you wouldn’t normally make just to reach the minimum spend is another. If you’re not careful and don’t have a plan in place, this can be harmful to your finances.

Look at your cash flow and determine which expenses can be put on your card to reach the minimum spend. If you’re able to comfortably spend enough to earn the sign-up bonus, it easily pays for the annual fee in the first year.

2. You regularly spend on travel and dining

The Chase Sapphire Preferred pays out 5X points on travel purchased through Chase Travel℠; 3X points on dining, select streaming services, and online groceries; 2X points on all other travel purchases, and 1X points on all other purchases. Some of the merchants in the travel category include airlines, hotels, car rentals, cruise lines, buses, taxis, ferries, toll bridges and highways, and parking lots and garages. Gas, unfortunately, is not an eligible expense under travel.

For this card to make sense financially, a sizable portion of your spending should be in these categories; otherwise, you’re paying an annual fee for a card that doesn’t align with your spending habits.

Since you get 25% more value on travel redemptions through the Chase Travel℠ portal with this card, points are worth up to 1.25 cents apiece. So in order to offset the cost of the annual fee, you would need to earn a total of 7,600 points. In the 5X category, that would be $1,520 (7,600 / 5 = 1,520) while the 3X category would be about $2,533 (7,600 / 3 = 2,533). For the 2X category, it's $3,800 (7,600 / 2 = 3,800). This doesn’t account for any other spending done on the card that will fall under the 1X earnings rate, which can help you offset the annual fee even sooner.

If you have combined spending in multiple categories, you should be able to earn enough to offset the $95 annual fee. Once you’ve spent enough to offset the cost of the card, any additional earnings will basically be money in your pocket.

3. You can make good use of the Ultimate Rewards redemption options

You can never have too many Chase Ultimate Rewards points. These points allow you to book with some of the best hotel and airline transfer partners. Plus, you get access to an easy-to-use travel portal which allows you to cover a wide variety of different travel costs. The only way you can have too many Chase Ultimate Rewards points is if you don’t ever use them.

If you assume “value” to mean what each of your points is worth in cents, redeeming your points for travel through the Chase Travel℠ portal offers great “value.” As mentioned above, you get a 25% increase in your point value when you book travel this way.

However, the Chase Sapphire Preferred is one of three Chase credit cards (the other two being the Chase Sapphire Reserve^® or Ink Business Preferred^® Credit Card) that unlocks the ability to transfer your Chase Ultimate Rewards points at a 1:1 ratio to a number of travel partners. This includes Marriott Bonvoy, World of Hyatt, and IHG Rewards Club, plus a variety of airlines, such as Emirates, Southwest, United, and Virgin Atlantic. If you book with any of these partners regularly, this redemption method might be the most valuable.

Either way, as long as you can make good use of the Chase Sapphire Preferred’s valuable award currency, paying the annual fee might be worth it.

4. You can make good use of the insurance protections that come with this card

A travel credit card wouldn’t be much of a travel credit card if it didn’t offer some built-in benefits like travel and purchase coverage. The Chase Sapphire Preferred offers a handful of protections that give you peace of mind during your travels, from trip cancellation insurance and an auto rental damage waiver to trip delay reimbursement and good, old-fashioned purchase protection.

Hopefully, you never have to submit a claim through any of these coverages, but if you can’t put them to good use — i.e. you don’t ever travel — these benefits will easily fall by the wayside. And remember, you’re paying $95 a year to have them.

If, however, you travel at least a couple of times a year, there’s no doubt that these protections can be put to good use.

5. You are a frequent Lyft or Doordash customer

Chase recently rolled out a few changes to its benefits, one of which was the addition of Lyft and Doordash benefits. Now through March 2025, Chase Sapphire Preferred cardholders can earn 5X total points on eligible Lyft rides. If Lyft rides are part of your normal expenses, this can definitely come in handy.

Chase also rolled out Doordash benefits you might find beneficial if you order in often. On top of the 2X points on other travel purchases purchases, you can also get reduced service fees and $0 delivery fees on eligible orders over $12 made with Doordash’s subscription service, Dashpass. This benefit lasts at least 12 months, and you need to activate it by Dec. 31, 2027.

6. No foreign transaction fees for purchases made outside of the U.S.

You want a travel credit card in your wallet that doesn’t penalize you every time you purchase something abroad. The Chase Sapphire Preferred is a credit card with no foreign transaction fees, so spend away without worrying about racking up any additional costs.  

When the Chase Sapphire Preferred annual fee isn’t worth it

This goes for any card that has an annual fee, but if you carry a balance from month to month, you’re losing money by having to pay interest. If you’re paying an annual fee on top of that, the total cost of the card can really add up. So if you regularly carry a balance each month, it might not be worth it to also pay an annual fee.

The Chase Sapphire Preferred is a travel rewards card through and through. That means if you don’t spend frequently on travel and dining, you might be hard-pressed to justify paying $95 every year for the card, though the $50 annual hotel credit can help lower your annual cost. While spending outside these categories doesn’t fall completely by the wayside, you’ll only earn 1X points per dollar spent on all other purchases.

Lastly, paying the annual fee for the Chase Sapphire Preferred likely isn’t worth it if you don’t make good use of the Ultimate Rewards redemptions, considering this is where much of this card’s value lies. If you don’t plan to travel, choosing a cashback card is probably your best bet. Our list of the best cashback credit cards is a great place to start.

Bottom line

The Chase Sapphire Preferred comes with a $95 annual fee, something that may have you second-guessing whether the card is right for you. But before you pass on it, it’s worth doing some quick math and considering your normal spending habits as well as future plans you have that will offset this cost.

The card pays for itself in the first year if you can spend enough to earn the welcome offer, especially if you can take advantage of the $50 annual hotel credit. After that, you need to consider how much spending you’ll do within the travel and dining categories and if it’s enough to offset the annual fee moving forward.