I Am Slashing Credit Card Fees Right & Left, Why You Should Too
Well I did it, I finally did it, something that I never thought would be possible. I gave the American Express Aspire card the deuces ✌. The card I called hands down the best perks card available. We finally parted ways even though it is still a great card in my opinion. I downgraded it to the Hilton American Express that comes with no annual fee. Then I went on to downgrade our Everyday Preferred card to no fee Everyday card. This week my wife will be calling on her Amex Platinum card, looking for a juicy 50K Membership Rewards retention offer. If she doesn’t get it we will be slashing the cost and downgrading it to the Amex Gold card. Why am I slashing credit card fees right & left? Is it because I don’t value the cards anymore? Nope. Is it because I can’t take advantage of them right now? Yup.
My Reasons For Downgrading Each Card
Travel is at a standstill as the country fights Covid-19. The virus is spreading and flattening the curve seems like it is still weeks away. And it really feels like we are 4-6 months away from being able to travel at all. I hope I am wrong there but it doesn’t feel that way right now.
So why would I pay for a travel perks card for 6 months when I can’t travel? This hobby is about maximizing everything we can. Paying $225-$275 to have a card collect dust in my sock drawer for 6 months isn’t maximizing anything. That doesn’t mean that I won’t upgrade back to these cards in the future but why not save some money while we sit on the sidelines?
Here are my thoughts behind each card I am downgrading:
American Express Aspire Card
The Aspire is still one of the best cards out there and one of my favorite 3 or 4 cards. But all of the value the card offers requires travel. Plus Amex makes the Aspire perks somewhat difficult to use under normal circumstances, it is even more difficult these days. The resort credit only works at certain properties, the free night is best used at expensive properties that normally take planning and the airline incidental is harder than ever to use. The earning structure isn’t great for current times either. Add all of that up and it means I would have to do a mad dash to max out these perks when travel starts back up.
My annual fee just posted last month so now was the perfect time to downgrade. Plus now I may be able to snag an upgrade offer down the road which is the perfect scenario. Once travel ramps back up I plan on upgrading back into the Aspire whether an upgrade offer comes or not.
Amex Everyday Preferred
The Everyday Preferred is a great earning card. But the 30 transaction requirements for the 50% bonus make it kind of a pain to max out. That is unless it is your everyday earner. With us being locked down under shelter-in-place orders it is difficult to hit that 30 purchase target. Plus this card is best used at the grocery store and I will be unable to max that out for the foreseeable future. Pair that up with a likely downgrade to an Amex Gold coming and this annual fee was kind of a waste. I downgraded to the Everyday card and hope for an upgrade offer down the road. But if it never comes it is a prime option to close whenever I grab another Amex credit card.
American Express Platinum
To be fair this one was on the chopping block before all of this hoopla started. My wife is coming up on her second anniversary for the card and as long as it is past your 12 month mark I would consider downgrading it. If she gets a good retention offer (30K or above) then we will keep it but if not we will finally be able to get our hands on an Amex Gold card. I said that I wanted to focus more on Membership Rewards this year and the Gold card is a big part of that. Plus it will rack me 4X earning on my many Walmart Grocery pick up orders.
Remember that American Express recently added terminology about perks abuse and included downgrades with it. So if you have already used a good portion of the perks then you may be stuck with the card until the next annual fee. That is something to be aware of when making your decision.
Other Cards To Consider Downgrading
This article just happened to focus on American Express cards but there are other ones that I would consider if I carried them.
The Chase Sapphire Reserve‘s value is heavily dependent on their Priority Pass membership and using the Chase portal at 1.5 cents per point. Those will not be an option for a while. Add in the recent increase of the annual fee I think this is a prime downgrade contender. The Chase Freedom or Chase Sapphire Preferred are good options. Choose the Freedom if you have another annual fee Ultimate Rewards earning card, like the Ink Preferred, and the Sapphire Preferred if you don’t. You can then upgrade down the road if you want to use the Chase booking portal with the CSR etc.
Another card to look at is the Citi Prestige. The most valuable perk of this card is the 4th night free perk. It may be a while before you get to take advantage of this perk and the travel and dining purchases are not rolling in like they used to. The Citi Premier is a great downgrade option and is a better overall earning card in times like these.
Premium airline cards that come with lounge access from Delta, United or American are another one to consider. These card’s value solely relies on the lounge access they offer. If you are not traveling for 4,5 or 6 months then you are simply tossing money down the drain.
There of course other options as well but I don’t want to go into every single one. What I would say is take a look at all of your annual fee cards and decide if you need them over the next 5 or 6 months and go from there.
Most of the cards I discuss in this article are very good cards that offer, people that know how to use them at least, outsized value. That isn’t what this is about though. The truth of the matter is you will not be able to extract that value for a little while so does it make sense to save some money now? Remember you should be able to upgrade back to the card at a later date if you need to. Also, only consider this if you have had the card for 12 months or more.
Share your thoughts below. Have you considered slashing credit card fees too? Which cards have you downgraded?