Reader question: Is the Chase Sapphire Reserve still worth it if you aren’t using the travel credit?

Mar 30, 2020

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The top-tier Chase Sapphire Reserve is the headliner in the Chase lineup of credit cards. It comes with a list of valuable benefits that can help make the $550 annual fee worth it, but if you aren’t going to use one of the card’s most lucrative perks — the $300 travel credit — is the card still worth holding?

I currently have the Chase Sapphire Preferred Card and the Chase Ink Business Preferred card. We are self-employed business owners, my wife and I. I want to upgrade from the CSP card to the Chase Sapphire Reserve, but my hang-up is I book all travel and hotels with our business card because of the 3x the points and it’s always a business expense because of self-employment.
So I wouldn’t really be able to utilize the $300 travel credit on the CSR card because then I’m not getting the business write-off. But I wouldn’t mind having some of the other perks.
Do you have any recommendations?

MITCH N.

Is the CSR worth the annual fee without the $300 travel credit?

The Chase Sapphire Reserve comes with a number of great perks for frequent travelers, but the $300 travel credit is one of the primary reasons cardholders hold onto it year after year. However, this doesn’t mean the card can’t be worth it even if Mitch won’t use that benefit.

(Photo by Wyatt Smith/The Points Guy)
(Photo by Wyatt Smith/The Points Guy)

Here are some of the quantifiable perks that come with the card:

In all, you’re getting $874 in annual value from the Chase Sapphire Reserve, if you utilize each benefit to its fullest. That’s more than enough to offset the cost of the $550 annual fee. And that’s not including the value you’ll get from some of the less quantifiable perks — like being able to redeem points through the Ultimate Rewards Travel portal at 1.5 cents each, earning 3x on dining, and the travel protections that the card offers (which may not be helpful while we’re all at home but can easily save you hundreds or even thousands of dollars when travel resumes).

However, by simply upgrading from an existing Sapphire Preferred card, Mitch will lose out on a 50,000-point bonus that comes with the Chase Sapphire Reserve. If Mitch earned a sign-up bonus for the Chase Sapphire Preferred Card more than 48 months ago, he should downgrade it to a no-annual-fee Chase card and apply for the Chase Sapphire Reserve separately to get the bonus.

If he’s had the card for less than 48 months, he’ll need to decide whether it’s worth it to skip the bonus and upgrade or if it’s close enough to that 48-month mark to wait it out.

Related: Chase Sapphire Reserve vs. Chase Sapphire Preferred  

Chase’s travel credit can be used for more than just airfare/hotels

Something else to consider is whether the $300 travel credit would really go unused, especially considering Chase’s broad definition of travel. In fact, you can use that travel credit on so much more than just hotels and airfare:

  • Parking lots
  • Garages
  • Timeshares
  • Campgrounds
  • Passenger trains
  • Buses
  • Taxis
  • Car rental agencies
  • Cruise lines
  • Travel agencies
  • Discount travel sites
  • Limousines
  • Ferries
  • Toll bridges and highways
Lyft mobile ordering
Mitch might be able to use the $300 travel credit, even if he doesn’t spend it on airfare and hotels. Chase defines travel broadly, including taxis, buses and more. (Photo by d3sign/Getty Images)

So if you think you’ll spend $300 on things like buses, ferries, tolls and parking, that credit could still be put to good use.

Using a personal card for business expenses

The reason why Mitch doesn’t believe the $300 travel credit will be utilized is that he puts all travel on the Ink Business Preferred Credit Card for the business write-off during tax season.

Business credit cards are excellent tools for those who own businesses or are self-employed, but you are not required to use a business card for business expenses. Plenty of people use a personal credit card for business expenses — some find personal cards with bonus categories that fit their needs better while others value the enhanced consumer protections that are standard across personal cards but not guaranteed on business cards.

Related: Do I need a business to get a business credit card?

That means Mitch could use the Chase Sapphire Reserve on a business expense such as travel and still deduct that expense during tax season — with some caveats.

Generally speaking, it’s not a good idea to mix business and personal expenses by putting them on the same card. When you have credit cards used only for business expenses, that makes it much easier to separate expenses during tax season. And it also makes it easier for you to prove to the IRS that business expenses are just that — business expenses — in the case of an audit.

(Photo by Natee Meepian/EyeEm/Getty Images
You can still write off business expenses that you put on a personal card, but you have to be diligent about tracking and documenting those purchases for tax purposes. (Photo by Natee Meepian/EyeEm/Getty Images

But you can have business expenses and personal expenses on the same card. Just make sure that you’re taking extra care to track those expenses — make note of the expense, why it’s a business expense and the date of the transaction, and keep any receipts. It’s definitely an extra hassle to try to utilize your personal card for business expenses, but it’s not impossible.

If that’s the route Mitch decides to go, I would suggest using the Chase Sapphire Reserve for just one expense per year (like a plane ticket or hotel reservation) that will utilize the entire credit. This way, he’s only having to track and report one business expense from his personal card rather than keeping track of multiple small purchases.

Bottom line

Any time you’re considering applying for (or upgrading to) a card that has a high annual fee, you should make sure that the fee is worth it. In Mitch’s case, an argument can be made to get the Chase Sapphire Reserve even if he’s not sure he’ll take advantage of the full $300 credit, as long as he plans to utilize the other benefits.

If he does decide to upgrade (or downgrade his CSP before applying for the CSR outright), timing is important. He may not utilize many of those Chase Sapphire Reserve perks right now while travel is at a standstill, so it might be worth holding out until COVID-19 concerns subside before making a move to a card with a higher annual fee.

Chase Sapphire Preferred® Card

WELCOME OFFER: 60,000 Points

TPG'S BONUS VALUATION*: $1,200

CARD HIGHLIGHTS: 2X points on all travel and dining, points transferrable to over a dozen travel partners

*Bonus value is an estimated value calculated by TPG and not the card issuer. View our latest valuations here.

Apply Now
More Things to Know
  • Earn 60,000 bonus points after you spend $4,000 on purchases in the first 3 months from account opening. That's $750 toward travel when you redeem through Chase Ultimate Rewards®
  • 2X points on travel and dining at restaurants worldwide & 1 point per dollar spent on all other purchases.
  • Get 25% more value when you redeem for airfare, hotels, car rentals and cruises through Chase Ultimate Rewards. For example, 60,000 points are worth $750 toward travel
  • Get unlimited deliveries with a $0 delivery fee and reduced service fees on orders over $12 for a minimum of one year on qualifying food purchases with DashPass, DoorDash's subscription service. Activate by 12/31/21.
  • Earn 5X points on Lyft rides through March 2022. That’s 3X points in addition to the 2X points you already earn on travel.
Intro APR on Purchases
N/A
Regular APR
15.99%-22.99% Variable
Annual Fee
$95
Balance Transfer Fee
Either $5 or 5% of the amount of each transfer, whichever is greater.
Recommended Credit
Excellent/Good

Editorial Disclaimer: Opinions expressed here are the author’s alone, not those of any bank, credit card issuer, airlines or hotel chain, and have not been reviewed, approved or otherwise endorsed by any of these entities.

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