Well, that came out of left field. Chase just announced an annual fee increase for the Chase Sapphire Reserve, to the tune of $100. Starting January 12, the annual fee on the card will be a whopping $550. To soften the blow, Chase is also introducing a $120 DoorDash credit.
So is it time to drop the Sapphire Reserve? Let’s take a look at this card’s features, recent improvements and how they stack up against the $550 annual fee:
DoorDash DashPass for Chase cardholders
This news comes a day after Chase announced a new DoorDash partnership that would grant complimentary DashPass membership to select Chase cardholders. DashPass is a subscription service that normally costs $9.99 per month and entitles members to free delivery over $12 at participating restaurants.
DoorDash delivery fees typically range from $0.99 – $5.99, depending on the restaurant and delivery area. If you’re currently paying for a DashPass subscription and don’t have another qualifying Chase card with a lower annual fee, then the $100 Sapphire Reserve fee hike might not sting as much.
Sapphire Reserve $120 DoorDash credit
The $100 annual fee increase on the Sapphire Reserve is less than the $120 DoorDash credit. But is it actually worth it? That depends on whether you normally spend $120 a year on DoorDash.
If you’d asked me six months ago, the answer would have been “absolutely.” I ordered from DoorDash at least twice a week at work. Nowadays? Not so much. So don’t think of this $120 DoorDash credit as “free” or offsetting the $100 annual fee hike in any way. Unless you actually spend $120 a year with DoorDash to begin with, you’re not really offsetting anything.
It’s important to note that the $120 Sapphire Reserve DoorDash credit is dispersed in $60 increments over two years: $60 through 2020 and another $60 through 2021. So if you’re new to points and are thinking of applying for this card and downgrading after the first year, keep in mind that you may miss out on the second half of that $120 DoorDash credit.
Sapphire Reserve’s Lyft benefits
Through March 2020, Sapphire Reserve cardholders earn 10 points per $1 spent on Lyft rides. Sapphire Preferred cardholders earn 5 points per $1. Depending on how frequently you’re using Lyft, these extra rewards can be significant or not worth considering.
When are the changes going into effect?
The $120 DoorDash credit and $100 annual fee increase will take effect on January 12, 2020. So, if you’re thinking of applying for a Sapphire Reserve, you might want to do it now to avoid a $100 fee hike—especially if you have no use for the DoorDash credit.
If your Sapphire Reserve renews on or after April 1, 2020, you’ll be hit with a higher annual fee. If your renewal is before April 1, you’ll still only pay $450 this year.
Should you renew your Sapphire Reserve card?
For many years, people have justified paying the $450 annual fee on the Sapphire Reserve because of the $300 travel credit and 50% bonus on Ultimate Rewards Travel redemptions. The argument was that you were really only paying $55 more vs. the Sapphire Preferred. With the 50% redemption bonus, the Sapphire Reserve was a no-brainer.
Those features remain the same, but the introduction of the $120 DoorDash credit complicates things. If you are, in fact, spending at least $100 a year with DoorDash, then the annual fee increase isn’t really changing anything for you.
If you keep utilizing the 50% redemption bonus, as well as the 3x bonus on travel and dining, you’ll probably continue to get value out of the card.
But if dining isn’t a big spending category and you don’t use DoorDash much, then it might be time to downgrade to a Sapphire Preferred. Calculate your annual dining and travel spending, as well as your Ultimate Rewards Travel redemptions.
If the Sapphire Reserve isn’t earning or saving you enough points to justify the $100 fee increase, it might be time to downgrade. Maybe even switch over to the Amex Green Card, which has a $150 annual fee and also offers 3X points on dining.
What are your thoughts on the Sapphire Reserve changes? Do you plan on keeping your card now that the annual fee is increasing to $550?
I’m out. Going to downgrade. Recently switched jobs so I don’t travel as much anymore. Hard to justify this card anymore and I don’t usually make redemptions through their portal but transfer to partners. I do have the Ink Biz, CFU, CF already.
Other things to note on DoorDash – their prices are higher via app than at restaurant. So even though you’re getting a $60/year “credit”, if you compare the menu, you’ll notice even McDonald’s has higher prices in the app (and lack of combinations we are used to) than in store. So, I’d argue it’s not even a $60 credit if the DD prices are also inflated.
That’s an excellent point, Mark. I noticed that too but completely forgot about it. It’s absolutely worth comparing the “savings” with the extra money you’re spending on food.
I’m probably out. I’ve had the card for several years, but am traveling less and don’t want to pay an extra $100 in annual fee.
It’s getting tougher for sure. These big banks seem to be intent on narrowing down their premium card customers.
My guess Chase is not making the money on this card they thought they would and figures they will lose a bunch of people to the Preferred Card, but raising the fee makes it more profitable for them. The door dash does nothing for me. I just picked up the Amex Plat. but do not plan on keeping it when the next fee comes around. I also have the Ritz card which I find quite valuable for the free night, $300 incidentals, PP, $100 flight credit, and 3 ea. club level upgrades. Those upgrades are really nice.
I do not see the Reserve being a long term keeper. I live in a rural area and DoorDash means little for us. Why keep a card that does not pay for itself?
That’s probably a big part of it. When the card first came out, there were all these news articles about how Chase lost $300 million on the CSR (the 100k bonus didn’t help) and wouldn’t be turning a profit for years. I think a lot of people are getting priced out of the premium card market. Changes like this just don’t make sense.
I believe my AF will be on my March statement and due in April. If it stays at $450 I’ll keep it. Otherwise, I’m out. Doordash and Lyft mean nothing to. I’ve enjoyed the card and use it a lot for the bonus categories, but barring any additions to the bonus categories or increased earning for normal spend, it’s not worth the increase. My wife has the CSP, so I think I can transfer my points to her.
Are you thinking of downgrading to a CSR too? Not a bad option.
Actually, I was thinking of just transferring all my UR points to her CSP and canceling my CSR, if not this year then next year for sure. Have some international travel coming up and I would really like to have the Priority Pass lounge access and the $300 travel credit.
What would be the rationale of having 2 CSPs in the house?
The only advantage is if you’re doing large amounts of MS. It’s better to spread it across multiple cards than concentrate on one. But if you’re not a big MS’er, it’s definitely better to save that $95 fee and become an authorized user on your wife’s card.
Actually, since my CSR has the largest credit limit of any of my cards, that would be reason enough to downgrade to the CSP.
I do about $35,000 per month in MS, but I don’t MS on my CSR. Mostly CFU, Citi AAdvantage and Citi Double Cash.
That’s a good way to go. Even though it doesn’t have a category bonus for MS, when you’re doing big numbers even those 1x UR points are nice. 25k of MS even at Simon Mall = $98.75 in fees. Still cheap for a RT ticket to anywhere in the U.S.
How much you MS on the CFU? % with respect to to CL?
My CFU is my every day “everything else” card, so I don’t do more than maybe 25% of my CFU credit line in MS.
My AF hits this month so I have another year to decide. I don’t use DoorDash and have only used Uber. I’ll try Lyft but I don’t use it enough to justify. I do like the CSR because of the 1.5x when using the Chase Travel Portal, and I’ve been using the portal a lot lately. If the math doesn’t add up I’ll have to downgrade to the CSP.
Yeah I have a feeling the CSP is about to get very popular (again).
I’m out. Never use either one of these perks
The new perks add minimal value to me as well, but I plan on keeping the card because of the 50% bonus for UR travel redemption, which for me is the single most useful feature of any card. I think the net annual fee of $250 is still very reasonable, especially compared to value proposition offered by the American Express Platinum, Citi Prestige, or even the Aspire. I redeem about 500,000 UR points through the 50% uplift bonus each year, so the card is still worth it to me.
In your case, the annual fee definitely pays for itself. For a lot of other people, the CSR will suffice.
Sometimes you don’t need the CSR for that 50% extra value if you transfer to partners where easily can get more than that.
Very true. Also, the difference between the CSP’s 25% vs. CSR’s 50% is negligible unless you’re redeeming at least 60k points via the UR portal.
Some of you may think this is a newbie question (sorry) – so would you DOWNGRADE to the Preferred, or move all your points to the Freedom, cancel your Reserve, wait until you’re past the 48 months (which would be soon after cancelling for me) and then request the Preferred so you can get that bonus? Then, move points back from the Freedom to the Preferred??
So no help here for me??
Sorry, Anette. I somehow missed your first comment. That depends on how far away you are from 5/24. In your case, if you’re pretty close then, by all means, hold out for a new bonus. Then when your new card is approved, move the points to that account.
I dropped the Citi Prestige after they gutted that card. I then hopped on the City Crystal Infinite bandwagon only to now experience their downgrades. My plan was to jump over to the CSR, but neither Lyft nor DoorDash wow me in the least bit to justify the additional $100 annual fee. I’m keeping the Crystal Infinite card for another year, as I’ve accumulated too many points to burn them fast enough, but then may actually consider either trying to product change to the Ritz card or pick up an AMEX Platinum. Regardless, I have some time to figure this out.
I’m still on the fence about Citi. It’s the only premium card I have left and even with the discontinued insurance, it still has features I make good use of. Really wish the banks wouldn’t make it so hard to decide.
It seems to be one step forward and two steps back with many of the premium cards as of late.
I think the problem is that there was a mad dash for premium cards (probably too many), banks spent a lot of money promoting them and just not recouping their investment. So they started cutting benefits and increasing fees. I also think the increased fees help them hone in on their target customers (i.e. people who don’t care about an extra $100 and probably spend big outside of MS).
Dropped to preferred two years ago.
I was passed 5/24 and then just lost interest in the CSR. I’m glad I did because these changes would have had me switching back.
I was holding CSR because i’m 2/24 and was applying to business cards first, now with these changes and $250 net AF, I won’t go for it anytime soon. I got the Amex Business Platinum with 110kMR Sub and I am more than happy to wait for Amex Platinum 100k targeted offer. Amex seems more convenient now.
Have you considered the Amex Green Card? It’s a good alternative to CSP and the annual fee is just $150.