Does anyone pay annual credit card fees?

[QuarterMillionMan]

Does anyone pay annual credit card fees? And if so why? On another site I've read that the Chase Sapphire Reserve ($450 annual fee) and Amex Platinum ($550 annual fee) are the 2 best credit cards to have for the added benefits. I perused the benefits and I cannot see the cost/benefit justification for paying $500 per year in fees for these credit cards. Am I missing something?

[disneysteve]

We pay $95/year for our Marriott Visa. In return, we get one "free" night certificate each year. That is worth well over $95, especially if you are careful and use it at one of the most expensive places that it covers. It lets my wife and I do a weekend getaway at a nice hotel for $95 that would normally cost more like $200 or more.

Of course, there are a bunch of other benefits from the card, but that one feature more than covers the annual fee.

[kork13]

Does anyone pay annual credit card fees? And if so why? On another site I've read that the Chase Sapphire Reserve ($450 annual fee) and Amex Platinum ($550 annual fee) are the 2 best credit cards to have for the added benefits. I perused the benefits and I cannot see the cost/benefit justification for paying $500 per year in fees for these credit cards. Am I missing something?

I'll start off by saying that those two particular cards are probably only worth it if you travel frequently. I've had the Amex Platinum card for just over a year now (I also have the Amex Delta Platinum & Blue Cash Preferred annual-fee cards). However, I do travel relatively often on military business (minimum 3-5+ 'business' trips, and normally 1-2 personal trips every year). Plus, Amex does waive their annual fees for military personnel, which makes the cards WAY worth it.

With that said, I have definitely gotten significant benefits from the Platinum card, well in excess of the $550/yr fee they normally charge. To start with, the sign-up bonus was enough to cover ~$800 in plane tickets. Also, their sponsored offers/discounts can be quite good (as long as you'd be spending the money anyway). For example, I was buying a security system for my new home last year, and a Platinum offer gave me a $100 rebate (off of $400). Likewise, I got a $100 rebate for booking an anniversary cruise in March for DW & I. I've gotten some good-quality clothing for free ($50 credit twice per year), credits toward Uber rides while traveling (~$80 saved, up to $15/mo), and free seat upgrades & on-board meals while flying ($200/yr credit for in-flight charges). The free access to the Amex Centurion clubs & Delta Sky clubs is simply incredible -- they make layovers far more leisurely, and the free food/drinks available avert the need to purchase meals from the price-inflated airport restaurants.

Honestly, if I didn't get the Amex cards without the annual fee, I might not keep the Platinum card... But the Delta & Blue cards are definitely still worth the annual fees. Delta gives you the free annual companion pass (worth far in excess of the $195/yr fee). Blue Preferred ($95/yr fee) gives 6% back on $6k of groceries per year (up to $360/yr), which compares to their no-fee Blue Everyday card (3% on groceries up to $6k/yr, so up to $180/yr), so even with the annual fee, you come out ahead.

[QuarterMillionMan]

Very informative kork, thanks. I'm doing a cost/benefit analysis to see if Amex Platinum would be worth it for myself. I fly maybe 3x's to 5x's per year exclusively for pleasure so it might be worth it.

[QuarterMillionMan]

Travel like a Boss. This website talks about the Centurion Lounges.

https://www.forbes.com/sites/johnnyjet/2017/08/02/travel-like-a-boss-with-american-express-centurion-lounge-access/#278626bf6a2a

[kork13]

One thing I didn't mention, just the basic rewards plan itself is pretty decent on the Platinum as well -- 5 points per dollar that's booked directly with airlines/hotels or on AmexTravel.com, and each 100 points is directly redeemable for $1 of airfare on amextravel.com...and when you redeem points there, you can sometimes get discounted airline tickets as well. You can also split payment (part cash/part points). So if you spend $5k on hotels/airfare between your 3-5 trips each year, you earn $250 worth of points for future travels.

If you do end up going for it, make sure that you apply through one of the AMEX signup bonus links, or with someone's referral link, which includes the signup bonus as well (happy to give you mine via PM if you'd like ). If nothing else, the signup bonus will cover at least the first year's cost of the annual fee (it's currently 60k points after $5k spending in the first 3 months...recommend you plan a couple trips at once, paying for those upfront is how I got over the spending requirement).

And yeah... as I said, I love the lounges! Really nice, comfortable place to relax, grab a bite to eat, and just pass the time during layovers.

ETA: I keep remembering extra travel perks... One of the other benefits they offer is a fee credit once every 4 years for you to get registered for either the expedited TSA Pre-check (domestic travel, $85) or Global Entry (international travel, $100), which are both valid for 5 years. As I was looking at it, I realized I haven't done the Global Entry yet, so I actually just submitted my application . Last thing I'll mention for now... Instant 'Gold' status with Hilton & SPG hotel chains, as well as preferred status memberships with Avis/Hertz/National car rentals.

So bottom line: The AMEX Platinum is definitely a travel card, and if you travel alot, it's very likely worthwhile. If not....there are better options.

[rennigade]

We pay $95/year for our Marriott Visa.

This is the only card we have that has an annual fee...Marriott Visa. Like DS said...depending on where/when you stay...some nights are around $200 at the hotel my wife uses.

I had this card years ago when we went to alaska. Hotels in the summer are really expensive...$250+ from what I remember (at least the marriotts.) Great use of a free night!

[~bs]

sapphire reserve has a yearly travel credit that offsets most of the fee cost. i have the regular sapphire, looking to get the reserve if they increase the bonus points again to 100,000

[scfr]

I have an Am-Ex Blue Cash Preferred that pays 6% cash back at supermarkets; it has an annual fee of $95.

Last year we spent $3,475 at supermarkets (groceries, gas, and some household supplies). With the 6% cash back we got $208.50 in statement credits. If we had used our Citi 2% cash back card we would have received $69.50 in statement credits for our supermarket spending.

So we received $139 more in statement credits for a $95 fee, making for a net gain of $44. Not an earth-shattering advantage, but still makes it worth paying the fee.

[Keshet]

I don't pay any annual fees. I think it's cuz I don't have any credit cards.

[Drake3287]

Haven't paid an annual fee in years. Although not my primary Visa card anymore, my older United Airlines Mileage Plus Visa card usually has a yearly fee but they have an unadvertised no annual fee card which gives 50% of the mileage credit compared to the regular card.

[TexasHusker]

My fee runs $150 or so a year?

Cost of doing business...

[bjl584]

$0 for me.

[disneysteve]

My fee runs $150 or so a year?

Cost of doing business...

Do business credit cards typically have annual fees? Plenty of personal CCs don't though some rewards cards do.

[~bs]

generally better business related rewards, higher credit limits, not as stringent charging thresholds. No foreign transaction fees.

Fee cards Example - I opened a no fee credit card, they gave me a $7500 limit. I opened a sapphire card, they gave me a $30000 limit. Business cards like amex platinum and such are similar.

If you use the cards as they're intended, they often have direct benefits that offset most, if not all of the annual fee. The card companies design the fees and the benefits towards a certain type of customer, if you dont fit the profile, the card wont be very attractive to you. for example:

Amex Platinum $550 fee

$200 annual airline fee credit on incidental fees charged by the airline you select.
5x Membership Rewards points on flights booked directly with airlines or with American Express Travel.
5x Membership Rewards points on eligible hotels booked on amextravel.com.
$200 Uber credit split into monthly $15 credits for US rides plus a bonus $20 in December.
$100 fee credit for Global Entry or an $85 fee credit for TSA PreCheck every 4 years.
Access to the American Express Global Lounge Collection, which includes Centurion Lounges, Priority Pass lounges and Delta Sky Clubs when flying Delta.
No foreign transaction fees.

--------------------------------------

I think if one travels a lot, especially internationally, it's worth having one fee card intended for frequent business/pleasure travelers. The last trip I took, I spent maybe $4k (some business transactions). Foreign transaction fees would have amounted to $160, which is already a lot more than the annual fee I paid on this card.