That card is costing you HOW much?

Recently, I got an email in my inbox letting me know that Delta and American Express were going out on tour to show how much they ❤ their customers. Since I was a Delta Skymiles American Express cardholder, I (and a friend of my choosing) would be able to get a free ice cream sandwich if I showed up at the date and time specified in the email. Now first off, I am never one to pass up free food–the joke/mantra in residency goes something like this:

If you see a chair, sit in it. If you see a bed, sleep in it. If you see food, eat it.

So of course, seeing that I could get ice cream on someone else’s dime (all because I picked up that card for the travel perks), I was more than willing to stop by after work. Lemme tell ya, #DeltaAmex did not disappoint!

sammich
Sweet and salty caramel ice cream in a pretzel-cookie sandwich. It did not suck.

While sitting and eating our ice cream sandwiches, my friend asked me which of the cards that were prominently displayed on the ice cream truck was the one I had–I replied I had the lowest echelon of them all, the gold card (btw, since when does gold=entry level?). The other two, platinum and reserve, were higher-level cards that came with more perks, such as the ability to board first and get into the Delta airport clubs and lounges. Curious to know what I was missing out on, I looked up the cards and was surprised at what I found–the annual cost of owning one of these babies ain’t cheap!

Annual fees are as follows:

  • Gold Skymiles: $95 (after $0 for the first year)
  • Platinum Skymiles: $195
  • Reserve Skymiles: $450 (whoa)

This got me wondering, what other cards have absurd annual fees all in the name of perks? And let’s be honest here, perks are nice and all, but is getting to board a plane first really worth a few hundred bucks a year? Or bag fees… For someone like me who flies maybe 5-6 times per year, it seems crazy to fork over that much money annually just to save $50 on a checked bag here and there. Granted, I can see how it would make sense if you only flew Delta and always checked a bag, as that could add up to $50/round trip flight, which means that Gold card would pay for itself pretty quickly. However, if you frugal-minded folks are at all like me, you would never check a bag in the first place if it cost money; after all, isn’t that what carry-ons are for? Anyway, thanks to the magic of the internet, I was able to compare and contrast lots of different credit cards to answer my question. Here’s some of the highlights:

Cards and their annual fees:

  • Amex Green Card: $95 (after $0 for first year)
  • Amex Gold Card: $195
  • Amex Platinum Card: $450
  • Amex Centurion (aka Black) Card: $2500 (minimum spending $250,000/year) –whoa dang
  • MasterCard Black Card: $495
  • Chase Sapphire Preferred: $95 (after $0 for first year)
  • Chase Ink Plus: $95
  • Bank of America Visa Alaska Airlines Signature: $75/$50 (depending on card status)
  • JetBlue Plus MasterCard: $99
  • Citi Prestige Mastercard: $450

Perhaps the more striking thing during this little bit of research was seeing just how many cards had $0 annual fees. Seriously, I originally thought I’d be writing a scathing blog post about how credit card companies are trying to take even more of our hard-earned money through additional costs/expenses, but it was actually pretty tough to find many cards that had annual fees; a lot of them have $0 fees forever, no intro gimmicks or special promos in sight (NB, this does not take into account what the APR might be). Which means, if you do have a card with an annual fee.. what are you getting out of it? And is it really worth it?

Since I don’t feel like the fee is justified for me, this Amex Skymiles card, like other travel cards I’ve gotten before it, will be canceled shortly before its annual fee kicks in. I will then return to my Chase Freedom card as per usual, because cash back rewards.

Thoughts/comments/suggestions? Would love to hear ’em below!

 

6 thoughts on “That card is costing you HOW much?

  1. I think you’ve hit the nail on the head in your last paragraph: cancel before the fee hits. That’s how to get all the perks and not pay the fees. By perks I mean sign up bonuses. points, miles or whatever. grab it and run – a bit like the free ice cream sandwich!
    We haven’t managed to justify any of the high fee cards yet, but the paybacks are good, and if you can use them you’ll get your money’s worth. We’re leaving those to the slightly more serious travel hackers out there for now!
    Anyway, at risk of self promotion, here’s some thoughts on the matter 😉
    http://www.planinvestescape.com/travel-hacking-for-absolute-beginners/

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  2. I am going to have to look at what you get for a $2,500/year fee with $250,000 spending. That is just absurd.

    I have two cards with annual fees and both made sense at the time I got them but right now it probably doesn’t make sense to keep both. One is a Southwest credit card and one is for American. We fly Southwest now that there are three of us (American was when I was a single lady) but the American Airlines cards gives me 0% interest balance transfers that I have been using to upgrade the house.

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    1. Let me know what you find out! I think at that level, you’re simply paying for the prestige of an exclusive card, because no benefits could be worth it. And I love Southwest! Haven’t yet been able to justify their annual fee, though–I don’t fly enough.

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