Should you cancel your Chase Sapphire Reserve?

4 Mins read

It’s been a turbulent year of sweeping changes to popular credit cards, so you might be thinking about which ones still deserve a spot in your wallet.

The Chase Sapphire Reserve® (see rates and fees) underwent major changes in June, which included increasing its annual fee to $795. To offset it, new earning rates and a range of travel and lifestyle credits were added.

Now that the Sapphire Reserve has one of the highest annual fees for a premium travel rewards credit card, you may be questioning whether it’s worth continuing to hold. After all, paying $795 in one billing cycle is a big ask.

If you’re crunching the numbers and it seems the Sapphire Reserve may no longer fit your budget or lifestyle, it’s important to consider your options.

Should you cancel your account? Or, should you maybe ask for a product change? Let’s walk through some of the possibilities to see which one is best for your situation.

TPG staff on the changes

Several TPG staffers, including credit cards writer Danyal Ahmed, carry the Chase Sapphire Reserve thanks to its impressive earning rates and travel benefits.

He doesn’t view the changes to the card and the increase in the annual fee as negative developments. The new statement credits enhance the value proposition for him, and the new earning rates actually help him earn Chase Ultimate Rewards points more quickly.

woman looking at bills — NATALIA GDOVSKAIA/GETTY IMAGES

However, TPG newsletter and partnerships editor Emily Thompson had a different take on the recent changes and annual fee increase.

“I’m not sure whether I’ll get enough value from the card’s updated benefits to justify the steep increase in the annual fee,” she said. “My annual fee won’t hit until May, though, so I’m going to see how much value I get from the card between now and when I have to pay the fee in May. If I’m not able to justify paying that much, I’ll downgrade to the Preferred.”

Downgrading vs. canceling

If you’re looking to get rid of the Sapphire Reserve, you have two options:

Cancel it.
Request a product change to a card with a lower annual fee.

In most situations, it’s better to downgrade the card than to cancel it.

Credit scores are made up of several factors, with a major one being your credit utilization ratio. After cancelling your Sapphire Reserve, your credit utilization ratio may increase because your overall line of credit across all your cards will decrease.

Also, keep in mind Chase’s 5/24 rule. If you cancel your Sapphire Reserve and then apply for a new credit card, the new application will count against your 5/24 limit. However, when you downgrade a card, it doesn’t count as a new account and won’t count against your 5/24 limit.

Chase bank branch location — WYATT SMITH/THE POINTS GUY

When canceling a card, you’ll forfeit any points that remain in your account. Some examples of ways to use your Chase points for great value include:

Booking travel through Chase Travel℠ at 1.5 cents per point or up to 2 cents per point with Chase Points Boost
Transferring your remaining balance to one of Chase’s partners, like Air Canada Aeroplan or World of Hyatt
Transferring your points to another one of your Chase accounts or an eligible household member

When downgrading a card, there are some restrictions to keep in mind as well. For example, Chase requires that you stay within the same card family. So, you can’t change your Sapphire Reserve to, say, a cobranded Marriott card.

One of the biggest drawbacks of canceling or downgrading a credit card is that you’ll no longer have access to any of that card’s perks, which, in the Sapphire Reserve’s case, include an annual $300 travel credit, hotel statement credits and lounge access.

Downgrade to the Sapphire Preferred

One common option is to downgrade to the Chase Sapphire Preferred® Card (see rates and fees).

This is a good choice for frequent travelers, as it earns bonus points on travel, has access to Chase’s transfer partners and comes with a more manageable $95 annual fee.

Sapphire Preferred Card holders also get access to some great travel protections, including primary rental car insurance.

Couple sitting together seaside in Croatia — FOKKEBOK/GETTY IMAGES

Even though the Sapphire Preferred may be new to you, you’re not considered a new cardholder. Therefore, you’re ineligible to earn the welcome bonus.

Cardholders can hold both the Sapphire Reserve and the Sapphire Preferred at the same time, a shift from Chase’s previous rules.

Downgrade to a no-annual-fee Chase card

If you’d rather not pay an annual fee, consider downgrading to a no-annual-fee Chase card like the Chase Freedom Unlimited® (see rates and fees) or the Chase Freedom Flex® (see rates and fees).

What this means for you is that you won’t lose all your hard-earned points. They can still be used for travel purchases on Chase Travel or redeemed for cash back, both at a rate of 1 cent per point.

By downgrading to either card, you won’t earn any kind of welcome bonus for the card you choose.

Mid adult couple hailing for a taxi at airport — FG TRADE/GETTY IMAGES

In the future, if you decide to apply for the Chase Sapphire Preferred or the Ink Business Preferred® Credit Card, you could transfer the points back to an account that earns true Ultimate Rewards points, which you can then transfer to Chase’s airline and hotel partners.

The information for the Ink Business Preferred has been collected independently by The Points Guy. The card details on this page have not been reviewed or provided by the card issuer.

Related: Best Chase credit cards

Bottom line

The Chase Sapphire Reserve has a steep annual fee that may not be worth it for every cardholder. If you’ve decided it isn’t the right fit for you anymore, consider downgrading to another Chase product instead of outright canceling your card.

Cards like the Sapphire Preferred and the Chase Freedom Unlimited are great options to weigh for a downgrade. By downgrading your card, you’ll protect your points and line of credit.

To learn more, read our full review of the Chase Sapphire Reserve.

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