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How to Get Your Annual Fee Waived

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Million Mile Secrets reader Sandy writes:

The annual fees for my various American Express cards have just been posted to my accounts. I’m thinking of calling AMEX to get these fees waived. What strategies should I use when calling in?

Many banks waive the annual fee for the 1st year you have their card.  And after that, you could wind up paying $50 to $450 per card per year!

When You Have Lots of Credit Cards, the Annual Fees Can Really Add Up!

Sandy can try to get the annual fee waived by calling the bank.  But what if this doesn’t work?

Ask Nicely!

Call the number on the back of your card and mention you’d like to cancel your card because the annual fee is too high.  Being polite on this call can go a long way!

Sometimes All It Takes Is a Quick Phone Call

Being a good customer helps your cause.  So if you’ve used the cards frequently and paid your bills on time, the bank is more likely to want to keep your business!

You could mention that you’d like to keep the card because of the benefits, but compared to other similar cards it’s hard to justify paying the annual fee.

They May Offer a Bonus Instead

If they bank won’t waive the annual fee they may offer you a statement credit or bonus points to cover a portion of the fee.

For example, some folks have been offered 5,000 AMEX Membership Rewards points and another 15,000 points after they spend $3,000 within 3 months  in exchange for keeping the AMEX Premier Rewards Gold .

The annual fee on this card is $175  $195 and 20,000 points are worth at least $200.   So this bonus makes it more than worth keeping the card!

Sometimes the Bonus Is Worth More Than Just Waiving the Annual Fee

Do the math when you receive an offer to determine if it’s a good deal!  You can also check Flyertalk to find out how your offer compares to what other folks have received from banks such as:

Hang Up & Call Again

If you don’t get an offer you like, can say you’d like to think it over.  Then hang up and call back to get another agent who may be willing to give you a better offer.

Before You Cancel!

If the bank won’t waive your annual fee or offer a bonus to keep your business, follow these tips before canceling your card.

1.   Don’t Make the Bank Angry!

Be sure you’ve taken the time to evaluate the card.  I usually recommend folks hang onto a card for 9 to 10 months and then decide if it’s worth the annual fee.  That’s because banks don’t like it when you sign-up for cards just to earn the bonus and then cancel right away.

They give out these incentives because they want you to try the card!

3.   Consider Switching to a No Annual Fee Card

Canceling a card could impact your credit score.  That’s because:

  •  Your credit utilization ratio (ratio of amount you owe to the total credit available to you) could increase once you cancel a card.  This accounts for 30% of your credit score.  However, the ratio can go back down when you apply for a new card.
  • Your credit history  (15% of your credit score) could decrease over the long term. Though this impact can be minimized by opening new accounts to replace them.  This is more of a concern for folks who are fairly new to credit cards.

So an alternative to closing your account, is switching to a no annual fee card  without a sign-up bonus  like:

Note:  Usually when you switch to a new card (instead of applying) you will not be offered a sign-up bonus.

You never have to cancel a no-annual-fee card.  And that helps you build a relationship with the bank and build a longer credit history!

Bottom Line

If you’re like Sandy and you don’t want to pay the annual fee on a credit card, you can try calling the bank and asking nicely!  They may waive the annual fee or offer you a bonus to keep you as a customer!

If you don’t like the offer you get, you can try hanging up, calling back, and speaking with another agent.

But you may decide you still want to cancel your card.  Before you close your account, be sure you won’t lose your points .

And ask if the bank can switch you to a card that has NO annual fee .  But be sure that card does NOT offer a sign-up bonus to new applicants because you won’t be eligible.

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Category: Bank

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