When you open a credit card you have to pay the annual fee, there is no going around it. For the second year however, when the annual fee posts to your account again, you MIGHT not have to pay it.
In the second year of having your credit card you can contact the credit card company that issued the card and ask the representative if there are any retention offers associated with your account. A retention offers is an offer the credit card company makes to valued customers to keep their business. Retention offers are NOT guaranteed. If offered, it can come in the form of a waived annual fee or a small points/miles bonus after you meet the spending requirement they set.
My Experience with Retention Offers
As this is my second year traveling on credit card points, my cards are starting to get to their second annual fee and I have been attempting to get retention offers on my cards. I have been successful only 1 out of 3 times .
- Chase Sapphire Preferred– no success and I had to pay the $95 annual fee to keep the card because it allows me to pool my Chase Ultimate Reward Points and transfer them to travel partners
- Chase Southwest Airlines Rapid Rewards Plus Card– no success and I had to pay the $69 annual fee again because I wanted to use it for the referral bonuses
- American Express Gold Personal Card– Success! I received 15,000 points in exchange for $2,000 spend on the card in 3 months. It did not cover the annual fee but it was a nice bonus since I had NO plan of cancelling this card. I paid the annual fee for this card because it has great earning categories that I use all the time (4X for dining and groceries). Also because I have it linked to my Rakuten account and I earn extra American Express points on my online shopping purchases, even when I don’t pay with my American Express card.
Getting a Retention Offer
You should always call the credit card company and choose to speak to a representative. When speaking to them you must say something to the effect of, “I’m calling because I’m thinking of cancelling this card. I’m having trouble justifying the annual fee for a second year.” They will try to tell you all the great benefits of the card and will ask you some questions. Play their game, answer their questions, and try your best to be elusive.
If after all of that they do not on their own offer you a retention offer, you can politely ask for one by saying, “I’m still on the fence, is there any retention offer associated with my account that could help make it easier to keep the card open?”
At that point, they will tell you if there is or if there isn’t an offer for your account. If there is not, then you can choose to call again at another time. Retention offers change day to day, so you might have better luck another day. If this is the case, then end the call by saying, “I think I need more time to consider this. As of now I will choose to keep the card open. Thank you.” Try calling again every few days within those first 30 days of when your annual fee showed up on your account. If you haven’t been successful by the end of the 30 days, they are not giving you one and you must decide whether to pay the fee, cancel, or downgrade the card.
Quick tip: When trying to obtain retention offers, try to put a good amount of money on the card prior to calling to show them that you are a good customer to them who actually uses their services.
My Experience For this Successful Retention Offer
With American Express, you can message them through your account or you can call. Like most people, I would rather send a message over talking to another human being. I tried twice through the app with no success. Both times I was only offered a slight discount if I wanted to use my points to pay for my $250 annual fee. Because American Express points are less than 1 cent per point when cashed out, they were offering me the “deal” of using 25,000 points to pay for my $250 annual fee, meaning they were giving me 1 cent per point. A savings of 16,667 points according to them. I declined because I told them I like to use my points for travel.
I was told that there is more success when you call and actually speak to a representative over the phone, so I tried this for my third attempt. I went through all of the above script and was finally successful. I was offered 2 options: 1) a $125 statement credit to help with the annual fee after I spent $2,000 in 3 months 2) 15,000 points after a $2,000 spend in 3 months. I accepted the 15,000 point bonus because these can be transferred to travel partners and be worth way more than $125. As soon as I was done with the call I proceeded to pay my annual fee because I do not want any late payments on my account. Those $250 did NOT count towards my $2,000 minimum spend.
The fine print he read off before I fully accepted was: I cannot cancel or downgrade the card within 12 months of receiving this retention offer, if “gaming the system” is suspected American Express has the right to cancel my account and I’d lose my points, my monthly payments cannot be past due, qualifying spend is only for goods and services, and fees and gift cards do not count towards the minimum spend. The points bonus will be added to my account 8-12 weeks after I have completed the minimum spend.
Good luck to you on your retention offer journey! Follow me on Instagram @mamitravelswithpoints to learn about traveling the world on points and miles
