The Sapphire Reserve Couple Conundrum


Don’t tell my wife, but I’m kinda in love with the Chase Sapphire Reserve.  Yes it comes with a hefty $550 annual fee, but for anyone who spends a decent amount of money each year on travel, the card’s annual $300 travel credit effectively brings the annual fee down to $250.  That’s tolerable considering that the card offers 3X points for travel & dining, 1.5 cents per point travel value, Priority Pass Select lounge membership (with unlimited guests), Global Entry fee reimbursement, etc.

Sapphire Reserve Couple

The Sapphire Reserve card earns Ultimate Rewards points.  Ultimate Rewards has long been my favorite transferable points currency.  Compared to its rivals, in my opinion, Ultimate Rewards has the best options for point transfers, purchasing travel with points, and cashing in points for those who prefer money over travel.

Ultimate Rewards also has the best options for point earnings, such as:

  • Sapphire Reserve: 3 points per dollar for travel and dining.
  • Ink Plus or Ink Cash: 5 points per dollar for cell phone service, cable TV, internet, and office supply purchases.
  • Freedom: 5 points per dollar in rotating categories each quarter.  5X earnings are limited to $1500 spend per quarter, so it is often advantageous to get more than 1 Freedom card.  This is usually accomplished by downgrading a Sapphire Preferred card to the Freedom card.
  • Freedom Unlimited: Earn 1.5 points per dollar for all spend.

Until the Sapphire Reserve card came along, Ultimate Rewards was not the best program for earning points for travel (that honor went to the Citi Premier card which offers 3X for travel and gas purchases).  And, it was not the best program for redeeming points for travel.  Yes, both the Sapphire Preferred and Ink Plus cards offered 1.25 cents per point value for travel, but the Citi Prestige card offered 1.6 cents per point value when redeeming Thank You points for American Airlines flights, and 1.33 cents per point value for all other flights.

Now, the Citi Prestige card will soon lose its enhanced redemption value (details here).  And, so, with the introduction of the Sapphire Reserve card, Chase now has the best all around combination thanks to the Reserve card’s 3X travel and dining bonuses and 1.5 cents per point value for travel.

Well worth the price for 1 frequent traveler

Given that the Sapphire Reserve card is well worth getting for its signup bonus, is it also worth keeping past the first year?  The $550 annual fee is daunting, but for those who travel frequently, the card’s automatic $300 per year travel credits bring the card’s effective annual fee down to just $250.  But, $250 isn’t cheap either.  Is it worth it?

Depending upon where you live and where you regularly travel, you may find the airport lounge benefit valuable or you may find it useless.  So, for now, let’s ignore that one.  Instead, let’s concentrate on just two benefits: 3X points for travel & dining, and 1.5 cents per point travel value.

3X points for travel & dining

If we compare the Reserve card to the $95 Sapphire Preferred card which earns 2X for travel & dining, then we can see that this card earns 1X extra for all of these purchases.  If we assume an average of $500 per month spent on travel & dining, the Sapphire Reserve card would result in an extra 6000 points earned per year compared to the same spend on the Sapphire Preferred.  Since those 6,000 points are worth $60 in cash or $90 in travel, the $55 per year difference in annual fees between the two cards is more than justified.

1.5 cents per point travel value

The Chase Sapphire Reserve and the Chase Sapphire Preferred get the same value for points when points are transferred 1 to 1 to airline or hotel programs.  The difference is when points are used to pay for travel through the Ultimate Rewards travel portal.  In that case, the Sapphire Reserve gets an extra .25 cents per point value.  If you redeem points for $600 in travel, the Sapphire Reserve would charge 40,000 points whereas the Sapphire Preferred would charge 48,000 points.  The 8,000 point difference between the two cards is worth $80 in cash or $120 in travel.  Again, the extra $55 annual fee for the Reserve card over the Sapphire Preferred is easily justified.

Points from other Ultimate Rewards cards become more valuable

Since Chase allows individuals to move points from one of their Chase Ultimate Rewards cards to another, simply having this card makes your existing points more valuable when used to pay for travel.

The couple conundrum

Now that you’ve convinced yourself that the Reserve card is a keeper, for you, what about your spouse?  Should you pay $75 per year to add your spouse as an authorized user?  Remember that the $95 Sapphire Preferred card allows free authorized users.  For an individual frequent traveler, the difference in effective annual fees between the Reserve and Preferred cards is only $55 ($150 vs. $95).  But the difference in effective annual fees for a couple is $55 + $75 = $130.  Is it worth it?

In the single person analysis above, I justified the value in the card both via its enhanced point earning power and its enhanced per-point value.  With a spouse, though, you can get the enhanced per-point value without adding them as an authorized user. This is because they can earn Ultimate Rewards points with other cards (including cards with no annual fees) and can then transfer those points to your Sapphire Reserve account.  For details about moving points from one account to another, please see: Chase point transfer rules made simple [Infographic].

So, the question of whether it is worth adding a spouse, depends only upon the value of the card’s ongoing benefits for your spouse (e.g. lounge access), and the card’s enhanced point earning power…

Does your spouse travel without you?

If your spouse regularly travels without you, then the authorized user card is probably worth paying for. This will give your spouse their own Priority Pass Select airport lounge membership and will let them earn 3X on travel and dining.  The Priority Pass membership alone can be easily worth the extra $75 per year if your spouse takes advantage of airport lounges a few times each year.  Keep in mind, though, that many airports do not have lounges that accept Priority Pass.  And, those that do are sometimes limited to specific terminals that you might not have easy access to.  For example, you may find a Priority Pass lounge exists in an international terminal which might be out of the way or inaccessible when flying domestic.  You can find eligible lounges here:

Even if your spouse doesn’t value the lounge benefit, the ability to earn 3X for travel and dining may be worth paying for. Compared to earning 2X, if your spouse spends at least $5,000 per year (about $420 per month) on travel and dining, then the extra rewards earned with the Sapphire Reserve are worth the $75 authorized user fee.

Does your spouse dine without you?

Even if your spouse rarely travels without you, the authorized user card might be worth getting if your spouse eats out a lot.  You can justify the extra $75 annual fee vs. a card that earns 2X for dining if your spouse spends at least $5,000 per year (about $420 per month) at restaurants, fast food, coffee shops, etc.

Ultimate Rewards no-fee category bonus options

If you can’t justify paying the authorized user fee for your spouse, they can still do well with these no-fee options:

  • Freedom: 5 points per dollar in rotating categories each quarter. Common 5X categories such as gas, dining, grocery stores, and wholesale club stores make this a great option.
  • Freedom Unlimited: 1.5 points per dollar for all spend. You can’t get easier than that.
  • Sapphire: 2 points per dollar for dining. This card is no longer available for new signups but you should be able to product change from the Sapphire Preferred, Sapphire Reserve, Freedom, or Freedom Unlimited.
  • Ink Cash: 5 points per dollar for cell phone service, cable TV, internet, and office supply purchases.  Also earn 2 points per dollar for gas and dining.

Regardless of whether your spouse earns points in their own account or as an authorized user in one of your accounts, points can be moved from the no fee card account to your Sapphire Reserve account in order to make them more valuable.  For full details please see: Chase point transfer rules made simple [Infographic].

The punt-now strategy (AKA wait a year, and then figure it out)

I’m still not sure exactly what I’ll do.  My wife does travel a lot without me, but rarely needs access to Priority Pass lounges when she does.  And, she already has Priority Pass Select membership from our Crystal Visa Infinite account where she has a no-fee authorized user card.

She probably does pay for enough travel and dining to justify the Reserve authorized user fee, but again we have other cards that have nearly as good dining and travel earnings, including that Crystal Visa Infinite card which is worth keeping for its airline fee credits alone.

So, it probably doesn’t make sense for my wife to get an Authorized User Reserve card, unless we consider the value of simplicity: by concentrating most spend related point earnings on Chase Ultimate Rewards, it keeps our rewards-life a bit simpler.

My solution is to punt.  We’ll wait a year and then decide.

Both of us signed up for the Sapphire Reserve in order to get in on the 100,000 point signup bonus.  The card has been so popular that it seems unlikely that Chase will keep the 100K bonus indefinitely.  I decided that both of us should hop on it while it was available.  So, for one year, we’ll each use our own Sapphire Reserve cards in order to get the 100,000 point bonus and to earn 3X travel and dining.

When the annual fees comes due in a year, we’ll downgrade one of our cards to a Freedom card to expand our ability to earn 5X in rotating categories.  And then we’ll decide whether or not paying the Authorized User fee is worthwhile.

Have you decided what to do?

If you’re in a similar situation, have you decided whether or not to add an authorized user card?  I’m interested in your thoughts about it.  What are you going to do?

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