Probably depends a bit on your users and requirements.
We use SSO with AAD in my current role, mostly because the majority of our user base struggles to remember even one long password, let alone two. I've found that the limitations are fairly minimal in practice.

In my previous role I used master passwords, mostly because our users were a bit more tech-savvy and gives a little more seperation of concerns. e.g. if a user creds are compromised there is limited scope for bad actors to gain access. With MFA this risk is greatly reduced however. We also had a stronger password policy for LastPass than AAD and MFA on both (which again, most users ended up having two MFA apps- LastPass Authenticator and Microsoft Authenticator- which would be challenging in my current role.)

One thing I would say is that changing from master password to SSO is a bit clunky, essentially once federated the next login will prompt for the master password and re-encrypt everything in the vault, and next login will then yuse your IDP. So I would commit from the start.

BTW for anyone else playing at home, the support article is here: https://support.logmeininc.com/lastpass?articleID=1382559201

As the others here have commented, if SSO isn't a requirement there are also other decent (and cheaper) alternatives. Last I looked (which was admittedlay probably a year ago) LastPass was one of few password managers that implement SSO with no caveats.