Credit Cards: Why I Don’t Mind Paying A $450 Annual Fee

Over the past week, the website has welcomed a lot of new subscribers. I’ve also received quite a few emails (…y‘all all up in my DM’s hahaha) concerning credit cards and (obviously) travel.

If you have been subscribed for more than a week, you have seen an uptick in posts titled “Reader Question.” I welcome these questions because it helps me gauge what is important to you. I also highlight these questions because it gives me an opportunity to clarify an aspect that I believe could be confusing/challenging for other subscribers.


Often, I find the biggest hurdle for those that are just getting started are… ANNUAL FEES!

Generally, it sounds like this:

“what’s the best card?”
“…depends on your goals and spending habits, but if you’re just getting started, I’d say Chase Sapphire Preferred
(10 minutes later)
“wait..I have to pay a $95 annual fee to have the card!? Nah, I’m gonna pass”
(6 months later) 
“How are you flying in business class all the time?”

When people discover how many cards I have or how much I pay in annual fees, they’re often shocked, though I’d like to think my card portfolio is easy to justify, given the benefits I get.

When considering a card, I always ask myself “do the benefits justify the annual fee?”


Let’s take a look at one of my cards…the Chase Sapphire Reserve (not to be confused with the Chase Sapphire Preferred and why I recommend it). The Reserve hit the market in 2016 with a whopping $450 annual fee which is understandably a lot of money. But before you write-off the card, the benefits include:

  • A welcome bonus of 50,000 Ultimate Rewards points after spending $4,000 within three months
  • A $300 annual travel credit
  • Triple points on dining and travel
  • A Priority Pass membership (with unlimited guesting privileges)
  • Fantastic travel and car rental protection
  • The ability to redeem points for 1.5 cents each towards travel purchases
  • A Global Entry fee credit every four years
  • The ability to add authorized users for $75 each

There are additional benefits that I did not list but the aspect that I want to focus on is that $300 annual travel credit. The card offers a $300 annual travel credit that’s more or less worth face value, since it can be applied towards any travel coded purchase.

To simplify that paragraph…I applied for the card. I was approved. On day 1, I paid Chase the $450 annual fee. However, $300 of that $450 is, essentially, an advanced payment. Anything that I put on my card that codes as ‘travel’ during the next 12 months (or before I pay my next annual fee) will be reimbursed.

Note: Chase is very generous with the “travel” category. Airlines, uber, lyft, car rental agencies, parking garages, cruise ships, hotels, motels, trains, buses, taxis, ferries, tolls, etc. all qualify as travel.

Personally, I know I’m going to spend more than $300 in travel a year so paying Chase upfront doesn’t bother me. Additionally, the Chase Sapphire Reserve offers triple points on dining AND travel – 2 areas where I spend a lot of money – so I find that to be worth the $150 annual “out of pocket.”

Let’s take it a step further, it costs money to visit an airport lounge (like THIS ONE, or THIS ONE, or THIS ONE). Let’s say, on average, those lounges cost $50 to enter, I would only have to visit 3 lounges to extract the remaining $150 value.


The World of Hyatt Credit Card (which has a $95 annual fee) offers an anniversary free night certificate valid at a Category 1-4 property, which I value at more than the annual fee.

The IHG Rewards Club Select Credit Card and IHG Rewards Club Premier Credit Card (which have annual fees of $49 and $89, respectively) offer an anniversary free night certificate valid at a property retailing for up to 40,000 points per night. I value that at way more than the annual fee.


Yes, I pay a lot in annual fees, but I also get a ton of value out of the cards I have. This includes some pretty awesome perks, from free hotel nights to access to all kinds of lounges. For the most part that covers the annual fees on my cards.

Obviously the math is going to differ for each individual. The benefits aren’t necessarily “worth” face value so I try to maximize the value that I receive from each card but hopefully, this is at least an interesting look at how I approach things.

Does this help explain cards a bit more? Does it give you a different perspective on the annual fees?


  1. I have the Platinum too. I agree, it has so many perks but for simplicity (& for those just getting started), I thought the benefits of CSR would be much simpler to explain and understand. Do you have a favorite card?

    Liked by 1 person

  2. Thanks for the review on the CSR! I have CSP, but also AMEX Plat and AMEX Delta Reserve, which have $550 and $450 annual fees respectively. I don’t mind the AFs given the benefits. In another year or so, I’ll upgrade the CSP to the CSR.


  3. Chase no longer hands out credits cards to canadian residents unfortunately (last i heard in the news). Do you have any info on some cards we can use here as well that offer great benefits?

    As always very detailed and insightful post.

    Liked by 1 person

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