Credit Card Annual Fees

Yes, I pay annual fees on some of my credit card.  Meaning this points collecting hobby is not totally free.  However, if you are serious about travel and understand the benefits of the cards you carry and how to maximize those benefits you learn to look at fees in an entirely different way.

Yesterday, I received notice from Mint, my personal finance, money manager app indicating I was charged an $89 credit card fee for my Barclays Aviator Advantage MasterCard.  It was an expected annual fee however, just because it is anticipated does not mean that it can't be negotiated or ultimately waved. I simply called the customer service number printed on the back of my card and asked if they would consider waving their annual fee.  I knew ahead of time how long I had the card
(April, 2012)  and the amount I had charged on it in the previous year.  This information helped to present my case for having the fee waived or negotiated. I originally applied for the card when it was a Barclays US Airways card, then when US Airways and American Airlines merged it was automatically switched to the Aviator Mastercard.  The fee attached to this card is $89 and I have yet to pay it, even once.

Today's call resulted not only in having the entire fee waived, but I was provided an additional spend bonus.  If I put $1000 of new charges on the card before August 1st I  will earn 5,000 American Advantage miles as a bonus.  That's a great deal.  I'll simply make a note to use this card until I earn the bonus and I'll then tuck it away until another offer comes along.  This card also comes in a fee free version but you lose the majority of the benefits that make the card attractive.

The benefits on my Aviator Red card include....
-Fee free 1st bag check for up to 4 passengers travelling with me - potential saving of $25 per passenger per domestic flights, international flights save more.

-priority boarding

-10% of redeemed miles returned to account up to 10K - this is why I really like keeping the card.  If   I book an award for 40K points I'l receive a 4K kickback in points.

While these are great benefits I wouldn't necessarily pay $89 for them but once again I have another twelve months fee free to enjoy the card for the price of a 5 minute telephone call.


      

The Plaza, Darling...

I know it's not the hotel legend it once was but it still is met with a raised brow to some when mentioning it as my destination for an overnight stay for today's trip to New York City.  The iconic 5th Avenue at Central Park South hotel is now a Fairmont managed property.    I love Fairmont hotels.  I've stayed at their Washington, D.C. and Maui properties previously and loved both.  

I'm at the Plaza tonight for one night, for free, of course.  Had I booked the room using the flexible stay rate the price quote was for $725. I also could have utilized the full pre-payment rate of $616.  I stayed at the Plaza in August of 2015 for 1 night as a rewards benefit for being a Chase Fairmont credit card holder.  The card has since been discontinued (January 2017).  I canceled my card in April of 2016 and have two free nights I have to use at any Fairmont property in the world.  Since I live on the east coast I take advantage of a once or twice yearly visit to NYC.  I'm a bit of a foodie, so most of my visits involve eating. 

I earned this $700+ stay because I charged $12,000 to my Chase Fairmont Card in one year.  I charge everything to a credit card.  I don't make charges I wouldn't normally make and I don't carry a balance.  This $12K charge was a no brainer and done in one swipe.  My mother was having her basement refinished and I offered to pay using my card, then she could pay me when the bill came due and for that I earned a $725 dollar room at the Plaza.  It's that easy.  It's called making the most from spending money.  Many financial blogs chastise those who use credit cards mostly because people are not disciplined but when you use credit cards to your advantage and not the advantage of the issuing bank you can enjoy similar perks.

College students can play the points game

In my last post I mentioned helping my son with his spend.  Today, I’d like to detail how I got him to the point where he earned a premium credit card.  My family look at me with raised brow with the way I spend and set up reward accounts for all. They've come to accept it more as the kookier things mom does then the actual benefit of what I do brings forth. 

My son used to get annoyed with me because “junk” email was taking up his inbox.  The junk email he was referring too were monthly statements from various travel partners, Delta, Club Carlson, Hyatt that I set up on his behalf so he could earn points.  Let me rephrase that so I could earn points for him. 

Manufactured spend

I recently wrote about acquiring 2 more credit cards and the finessing I had to do with Chase in order to not be denied on my applications because I carry 6 active Chase cards (see post here).  The two cards I received require a total of $3000 in spends in 3 months, this is a relatively low spend for the amount of points.  The United Mileage Plus Explorer card came with a 55K bonus after a $1000 spend and the British Airways Visa 50K Avios points with a $2000 spend.

Pleading my case with Chase

When I apply for fresh credit cards in order to acquire the bonus points associated with my cards of choice I usually apply for more than one on the same day, at the same time, which helps keep the hard pull inquiries down on my credit report so as not to impact the credit score more than 5 points.  Every time you apply for credit a hard inquiry is done and too many hard inquiries in a short amount of time have a negative impact on a credit score.

Paying a fee to carry a credit card

We are conditioned to accept that fees are bad.  This opinion becomes even more relevant when it pertains to paying a fee just to have a certain type of credit card.  There are plenty of credit card companies vying for our attention so why would one ever pay a fee for the privilege of having a particular card in their wallet?  Sadly, many don’t realize the full potential of the card and how its benefits can play into their travel plans.  The majority of the cards I carry are fee based.  The lowest fee for a card in my arsenal is $69 and the highest $450.  Yes, $450 (a separate post will explain the logic behind that acquisition).  Generally, most fees average around $95, carry 15 cards and that adds up real quick. If I do end up a paying a fee for a card I most likely never pay to retain more than two. When the annual fee comes due the simple solution is cut up the card slated for renewal then wait for the next round of applications for new cards to start the cycle all over again.  Several banks waive the fee for the first year so you can experience their card benefits without worry.   I have a credit card up for renewal in a few weeks.  I know the bank will not negotiate on the renewal fee (some cards reduce the fee or eliminate it altogether if you ask) so I must decide whether or not this card is worth the $95 annual renewal for what I receive and how I leverage those benefits to suit my upcoming travel.  The card is Chase Ink Bold,  it's a charge card not a credit card, meaning that the balance must be paid in full each month.  This is not an issue because as I have written before, this hobby is not recommended for anyone who carries a credit card balance month to month.    

The Ink Bold is a business card and I use it to pay my landline, cell and cable bill every month because I receive 5x the amount of points for each of those bills.  There are other benefits such as all office supply store purchases are given 5X your total spend, 2x for all fuel and hotel purchases, and no foreign transactions fees.  Given that the three bills mentioned above run me close to $400 per month, I rack up a cool 24K ultimate rewards points a year for paying bills I have to pay anyway.  Those 24K points translate into either 1 night  in a top tier Hyatt  (with 2K left over)or several nights in lower tiered Hyatts.  Currently, 1 night at the Park Hyatt Maldives runs $1040.  So for an investment of $95 I can acquire this expensive out of reach room for 10% of its full price.  Anytime a card comes up for renewal I think about my upcoming travel plans and how the benefits of the card will suits my needs.  I never promised that my travel techniques would be fee free, only that seemingly out of reach travel was possible for those willing to invest a little time.       

You have what?..."15 credit cards"

Yes, I currently manage 15 active credit cards.  For a living I formulate large budgets so keeping track of numbers comes easy.  With 15 credit cards I do have a spreadsheet I maintain to keep track of all necessary data pertaining to bonuses, fees, benefits, expiration dates etc.  The hardest part is remembering what card I need to use for a particular purchase.  While all of my previous posts have been referencing my upcoming Asia trip, my daily spending is being geared for the next continent I plan to cross of my list; South Africa.  Knowing where I plan to visit and what airline I’ll use to arrive at my destination determines what cards I’ll use for my spending.  Let’s go back to the quantity of credit cards for now.  So what did 15 credit cards do to my credit score…not much.  In November 2012, my credit score averaged 810.  Since then I have refinanced a mortgage and had several hard credit inquiries.  Hard pulls are when one of the 3 main credit bureaus – TransUnion, Experian and Equifax access your credit report.  Once you cross a certain number of hard pulls in a particular  period your score is impacted.