The card pays you back on travel and dining, but the annual fee cuts into rewards unless you spend enough

The Chase Sapphire Preferred is a rewards card that gives you 2 points per dollar on flights, hotels, rental cars, and restaurants, and 1 point per dollar on everything else. Those points are worth more than points from most other cards — each point converts to 1.25 cents when you book travel through Chase's portal, or 1 cent if you transfer them to airline and hotel partners. The catch is the $95 annual fee, which means you need to earn enough rewards to make the card worth keeping.

Whether this card makes sense for you depends on how much you actually spend on travel and dining. If you spend $10,000 a year on those categories, you earn 20,000 points, worth roughly $250 at the standard redemption rate. Subtract the $95 fee and you net $155 in value. If you spend $5,000 a year on those categories, you earn 10,000 points worth roughly $125, which leaves you $30 ahead after the fee — a thin margin that disappears if you don't redeem strategically.

Key Takeaways

  • The card charges a $95 annual fee with no waiver for the first year, so you pay it when ready whether you use the card or not.
  • You earn 2 points per dollar on travel, dining, and some streaming services, and 1 point per dollar on everything else.
  • Points are worth 1.25 cents each when booked through Chase's travel portal, or 1 cent each if transferred to airline and hotel partners.
  • The card includes trip cancellation insurance, emergency medical and dental coverage abroad, and lost luggage reimbursement, but these cover specific situations, not routine travel costs.
  • You need to spend roughly $5,000 to $7,500 per year on bonus categories just to break even on the annual fee.

How the rewards actually work and what they're worth

Points accumulate in your Chase account as you spend. One point per dollar on non-bonus purchases, two points per dollar on travel and dining. You can redeem them three ways: through the Chase travel portal at 1.25 cents per point, by transferring to airline and hotel partners at varying rates (usually 0.8 to 1.5 cents per point depending on the partner), or by converting to cash back at 0.8 cents per point.

The travel portal redemption is usually the best deal if you're flexible about which flights or hotels you book. You log into your Chase account, search available trips, and pay with points instead of cash. The portal shows you the point cost upfront, so you can compare whether paying points or cash makes sense. If a flight costs 50,000 points through the portal, that's worth $625 at the 1.25-cent rate. If the same flight costs $500 in cash, you're better off paying cash and saving the points for something else.

Transferring points to partners works differently. You move points from your Chase account to, say, United Airlines or Marriott Hotels, and then book using those partner accounts. Partner redemption rates vary wildly — a flight that costs 25,000 United miles might be worth $300 or $200 depending on the route and how far in advance you book. This route rewards people who know the partner programs well and can spot underpriced awards. If you don't, the portal is simpler and usually competitive.

Insurance and travel protections that come with the card

The card includes several insurance policies that cover specific travel problems. Trip cancellation and interruption insurance reimburses you if you have to cancel a prepaid trip because of a covered reason — illness, injury, or death of a family member — up to $10,000 per person. Trip delay reimbursement covers meals and lodging if your flight is delayed more than 12 hours, up to $500 per trip. Emergency medical and dental coverage abroad pays up to $250,000 for emergency medical care and $500 for emergency dental work if you're traveling outside the United States.

Lost luggage reimbursement covers baggage and personal belongings if an airline loses or damages your luggage, up to $2,500 per person. Emergency evacuation and transportation covers the cost of emergency evacuation if you're injured or become ill while traveling, up to $250,000. Rental car damage coverage reimburses you for damage to a rental car if you decline the rental company's insurance and pay with the card.

These protections are real, but they're not a reason to get the card by themselves. They cover specific, uncommon situations — most people never file a claim. They're a bonus if you travel regularly and want the rewards, not a primary benefit. Read the full terms on Chase's website before relying on any of them, because coverage has exclusions and caps that vary by situation.

When the $95 annual fee is worth paying

The fee makes sense if you spend enough on bonus categories to earn at least $95 in value per year. That usually means $5,000 to $7,500 in annual spending on travel and dining, depending on how you redeem. If you spend $6,000 a year on those categories, you earn 12,000 points worth $150 at the portal rate, which covers the fee with $55 to spare.

The math gets better if you use the card for business travel or if you dine out frequently. Someone who spends $2,000 a month on restaurants and hotels easily earns $240 in annual value, making the fee negligible. Someone who travels once a year and spends $500 on the trip probably shouldn't carry this card.

Chase does not waive the annual fee in the first year, so you pay $95 when ready. Some competing cards waive the first-year fee, which gives you time to test whether you'll use the rewards. With Sapphire Preferred, you're committed from day one.

How this card compares to other travel rewards cards

The main competitor is the Capital One Venture X, which charges $395 annually but earns 5 points per dollar on flights and hotels booked through the card's portal, and 2 points per dollar on everything else. Points are worth 1 cent each, so a $10,000 annual spend on travel earns $500 in value — but you subtract the $395 fee, leaving $105. That card makes sense only if you spend heavily on travel and can use the $300 annual travel credit that comes with it.

The American Express Platinum charges $695 annually and earns 5 points per dollar on flights and hotels booked through Amex Travel, plus 1 point per dollar on everything else. It includes $200 in annual airline credits and $200 in annual hotel credits, which effectively reduce the fee to $295 if you use them. It's built for frequent business travelers who spend $20,000 or more per year on travel.

The Sapphire Preferred sits in the middle: lower annual fee than Amex or Capital One, but also lower earning rates. It's the right choice if you spend $5,000 to $15,000 per year on travel and dining and want straightforward rewards without the complexity of premium cards.

What happens to your points if you close the card

Points stay in your Chase account after you close the card, so you don't lose them when ready. You can continue to redeem them through the Chase portal or transfer them to partners. However, if you close the card and don't have another Chase card that earns Ultimate Rewards points, your account may close after a period of inactivity, and you could lose the points. Check Chase's policy before closing the account.

If you're thinking about canceling because the annual fee isn't worth it, consider downgrading to a no-fee Chase card instead — the Chase Freedom Unlimited or Chase Freedom Flex. You keep your points and stop paying the fee, though you'll earn fewer points on new purchases going forward.

How to decide if this card fits your spending

Track your spending on travel and dining for the past three months. Multiply that total by four to estimate your annual spending. If the number is under $5,000, the card probably costs more than it returns. If it's between $5,000 and $10,000, the card breaks even or slightly ahead. If it's over $10,000, the card is likely worth the fee.

Also consider how you redeem. If you always book through the Chase portal and take the 1.25-cent redemption rate, your points are worth more. If you transfer to partners and don't know those programs well, you might get only 0.8 cents per point, which cuts into the value. Be honest about which redemption method you'll actually use.

Finally, ask yourself whether you'll use the card consistently. A card that sits in a drawer earns no points and costs $95 per year. If you travel or dine out regularly, the card pays for itself. If you don't, it doesn't.

Frequently Asked Questions

Does Chase waive the annual fee the first year?

No. The $95 annual fee charges when ready when you open the account. Some competing cards waive the first year, but Sapphire Preferred does not. You pay the full fee whether you use the card or not.

Can I transfer points to any airline or hotel?

No. Chase has a specific list of transfer partners that includes most major airlines and hotel chains — United, Southwest, American, Delta, Marriott, Hyatt, and others — but not all. Check Chase's website for the full list before opening the account if you have a specific airline or hotel in mind.

What's the difference between the Sapphire Preferred and the Sapphire Reserve?

The Reserve charges $550 annually, earns 3 points per dollar on travel and dining, and includes $300 in annual travel credits and $120 in annual dining credits. It's designed for people who spend $30,000 or more per year on travel. The Preferred is the entry-level version for moderate travel spenders.

Do I have to use the Chase travel portal, or can I book anywhere?

You can book anywhere and still earn points — the card earns 2 points per dollar on all travel purchases, whether you book through Chase or directly with the airline or hotel. The portal just offers a higher redemption rate (1.25 cents per point instead of 1 cent) if you choose to use it.

What happens to my points if I close the card?

Points remain in your Chase account and you can continue to redeem them. However, if you close the card and have no other Chase Ultimate Rewards card, your account may close after a period of inactivity and you could lose the points. Downgrading to a no-fee Chase card instead of closing preserves your points and account.