Are the benefits offset by a $ 550 annual fee?

The Chase Sapphire Reserve® card was so popular when it launched in 2016 that Chase was short of the metal needed to make the card.

Since then, the Sapphire Reserve has built a loyal following of card members who have learned to take advantage of the card’s premium travel benefits, including a coveted $ 300 annual travel credit and free airport lounge access.

Last year, the Sapphire Reserve card underwent several updates, most notably when Chase increased its annual fee to $ 550. Nonetheless, the card has delivered a ton of benefits with new partners such as Lyft, DoorDash and Peloton helping to balance the higher annual fee .

If you expect to travel again this year, consider adding this card to your wallet. Below, CNBC Select breaks down the Chase Sapphire Reserve rewards, benefits, and rewards so you can decide if the card is worth it.

If you’re a foodie or a frequent traveler, this rewards program is for you. You earn 3x points for travel and dining worldwide and 1x points for all other purchases. Plus, earn 10X points on Lyft purchases through March 2022.

The welcome bonus is great too – earn 50,000 bonus points after spending $ 4,000 on purchases in the first three months of opening an account.

The Sapphire Reserve has two unique benefits that can maximize the value of your points by 50%:

1. Chase Ultimate Rewards® Portal: Simply use your points to book hotels, airline tickets, cruises and more directly through the travel portal.
2. Pay yourself back: Use this tool to redeem points for a statement credit for purchases at grocery stores, restaurants (including restaurants, takeout, and eligible delivery services), at home improvement stores (such as Home Depot and Lowes), and toward contributions to a dozen eligible good goals. Valid until April 30, 2021.

If you use any of these redemption options, the welcome bonus of 50,000 points is worth up to $ 750.

CNBC Select calculated how many rewards the average American can earn if they optimize the way they use their Chase Sapphire Reserve card. We partnered with location intelligence firm Esri, who provided us with an annual spending budget of $ 22,126.

The budget spans six main categories: groceries ($ 5,174), gas ($ 2,218), dining out ($ 3,675), travel ($ 2,244), utilities ($ 4,862), and general purchases ($ 3,953).

Here’s how many points you can earn in each category with your Chase Sapphire Reserve card:

• Groceries: 5,174
• Gas: 2,218
• To go out for dinner: 11,024
• To travel: 6,733
• Tools: 4,862
• General purchases: 5,929
• Total: 35,940

When you redeem these points for travel through Chase Ultimate Rewards® or Pay Yourself Back, you will receive a 50% bonus, raising the value from approximately $ 359 to approximately $ 539 per year. (This does not take into account the annual fee or welcome bonus.)

When you factor in the $ 550 annual fee and the 50,000 point welcome bonus, earnings for the first year drop to about $ 309 for regular repayments, assuming 1 point is worth a penny. If you decide to redeem points through Chase Ultimate Rewards or Pay Yourself Back and receive 50% more value, the value will increase to about $ 739. (That’s because the bonus is now worth $ 750, not $ 550.)

The Chase Sapphire Reserve card offers more than two dozen cardholder benefits, adding extra value to the points we’ve outlined above.

Many of the best perks have a marked value of $ 60 to $ 300 each. When optimized, these benefits can help you more than offset the $ 550 annual fee.

These are the main benefits:

• $ 300 annual travel credit to offset flights, hotel stays and more
• $ 100 credit towards Global Entry / TSA PreCheck fees every four years
• Free DashPass (worth about $ 119) for at least one year (register before December 31, 2021)
• A credit of up to $ 120 to Platoon digital and all-access memberships (register before December 31, 2021)
• $ 60 DoorDash credit in 2021
• Free year from Lift up pink membership (worth approximately $ 239 per month)including a 15% discount on car journeys, relaxed cancellations and priority airport pick-up
• Priority Pass Select lounge access (worth $ 429), which gives you access to more than 1,000 VIP lounges in more than 500 cities around the world

In addition to these benefits, you can take advantage of convenient travel and purchase benefits such as:

• Protection for eligible purchases that are lost or damaged
• Return protection for eligible items that the store will not take back
• Comprehensive warranty protection on eligible purchases
• Roadside assistance while traveling in the US and Canada
• Car rental damage exemption
• Insurance for baggage delays
• Compensation for lost luggage
• Travel cancellation / interruption insurance
• Travel delay compensation
• Travel accident insurance
• Travel and emergency services
• Special perks at The Luxury Hotel & Resort Collection include complimentary room upgrades, early check-in and late check-out
• Emergency evacuation and transport
• Emergency medical and dental

Find out about the specific terms and conditions for each benefit.

This card comes with a pretty hefty $ 550 annual fee. That’s why it’s not for everyone. You must pay the annual fee on your first statement and then on each subsequent anniversary of your account. You can pay off the annual fee during the year by earning rewards and taking advantage of the above benefits.

There is no intro 0% APR period for this card, so it should not be used to fund new purchases or complete balance transfers. The APR is typically 16.99% to 23.99% variable on purchases and balance transfers.

This card does not incur a foreign transaction fee, so you can travel outside of the US and spend money without the 3% average fee.

If you are a frequent traveler, the Chase Sapphire Reserve card can be a useful addition to your wallet. To offset the $ 550 annual fee each year, you’ll need to take full advantage of most of the card’s benefits, from the $ 300 annual travel credit to the Lyft, DoorDash, and Peloton benefits. That said, this card has a robust package of benefits that range from travel insurance and statement credits on eligible expenses to 50% added value on select rewards.

But if you don’t want to pay more than $ 550, consider the more affordable Chase Sapphire Preferred® card. This card has an annual fee of $ 95 and still offers a 25% boost on eligible points reimbursements. Plus, you can take advantage of many of the same travel and purchase protections, as well as similar credit statement offers.