Tell someone not in this game that you have over $1,000 in annual credit card fees and just watch their mouths drop! They don’t understand how much value can be achieved through these cards and how those annual fees are actually more than made up for with the benefits and credits we get from them.
Some Amex Annual Fees Are Getting Harder to Justify
However, American Express has seen fit to raise annual fees on some of their own Membership Reward card over the past year or so. With those fees, they have added benefits that are somewhat “meh” to many customers.
Is it the lack of substantial benefits for all that makes these annual fees harder to justify? Not entirely. Here are the things that I see that make these annual fees more difficult to swallow.
Amex Offer Limitations
Amex Offers used to be an incredible way to get incredible return on cards, especially on many Membership Reward cards. Offers like getting thousands of MR points for spending at airlines or other retailers is a great way to get value from the card.
Even small offers were great for getting value. Since it used to be possible to save these offers to multiple cards, you could scale a small offer up to something much larger. One example is like the current Adorama offer – spend $250 and get $25 back. That is a nice deal but if you saved it to multiple cards, you could buy unlimited $250 gift cards across all your cards and basically get a discount of 10% off high priced cameras and computers.
No more! With the elimination of saving Amex Offers to more than one card, it does not allow scaling any more which means value has dropped a bit.
Benefits Shared with Other Cards
One of the great things about cards like the American Express Platinum card was the lounge access that came with it. Over time, however, other premium cards have released similar benefits (though the Amex Platinum gives you Centurion Lounge access). Even the $95 annual fee Hilton Ascend card offers 10 free Priority Pass lounge visits per year.
If you have other premium cards, the lounge access on the Amex Platinum cards is not as valuable (unless you are using the Centurion access).
Another benefit is airline credits. Sure, it is always great to get more credits but cards like the Chase Sapphire Reserve has a travel credit that is far less restrictive. For the casual traveler, it can be a bit of a stretch to hold multiple premium cards and spend hundreds of dollars on airlines’ incidentals/gift cards.
When you add up what you can get from cards, it is always important to not look at breaking even with the benefits as getting your annual fee “back.” Instead, the goal should be to get well more than the annual fee back in value during the year.
With these changes, it is getting harder to justify the annual fees on some Amex cards. Sure, the earning rates on some cards can be great but it can be hard to commit to an annual fee on a card strictly based on the earning rates. You never know what will come out during the year or what deals you may find so it is always nicer to value from a card in multiple ways.