Yahoo Finance How I Got My Credit Card's Annual Fee Waived for a Second Year
If you've applied for a rewards credit card in the last few years, you've probably run across a card or two that comes with no annual fee for the first year. They're everywhere.
Rewards junkies love these deals. They sign up for the card, hit the minimum spending threshold (say, $3,000 in the first three months) and collect the big signup bonus -- all without having to pay any annual fee. Then, after about a year, before getting hit with that first annual fee, rewards chasers will often cancel the card. That's really key. The rewards game is a lot less lucrative if you have to pay $80 to $100 in annual fees per year every time you get a new card. That makes the whole game much less profitable.
[See: The Best Credit Cards.]
What many folks don't know, however, is that you just might be able to get that annual fee waived for a second year as well, just by making a phone call.
Now, not everyone will be able to do so -- those with the best credit get the most breaks -- but it can be done. I'm living proof.
Here's what happened ...
I've had my Citi AAdvantage Platinum Select World Elite MasterCard for about a year now and planned to cancel it. I had long since met the minimum-spending threshold and gotten my 50,000-mile bonus, and I knew that I'd be facing an annual fee of $95 soon if I didn't cancel. (Note: I wasn't worried about the impact of cancelling on my credit score. Generally speaking, as long as you don't carry a balance on your cards, the card you're cancelling isn't by far your oldest and you don't cancel a bunch of cards at a time, the impact of cancelling a card is pretty minimal.)
Still, I liked the card. I travel a bit with my family and for my job, and I like that the card gets me and my family Group 1 boarding when we fly American. I also like that it gets us each one free checked bag. The card comes with other perks, too, but those are the most impactful to me. I didn't want to lose them, but I didn't particularly want to pay $95 per year to keep them, either.
[See: The Best Cash Back Credit Cards.]
I decided to take a chance. I've written for MyMoney about data showing that a surprisingly large number of people who ask to have a late payment fee waived or an interest rate reduced are successful -- 89 percent and 79 percent, respectively -- but hadn't seen similar data on getting annual fees waived. With that in mind, I decided to follow my own advice: Make the call. The worst that can happen is they say no, but often they say yes.
I called Citi and told them my situation: I like the card and its perks, but I'll cancel it unless Citi can waive the annual fee for another year. I was polite and pleasant when I said it, but I was also direct and to-the-point. I also really was willing to walk away, which gave me extra leverage.
They said yes, with a twist.
They told me that if I spent at least $95 on the card in the next 30 days, they'd credit me the $95 cost of the upcoming annual fee.
Initially, I didn't know what to do with their offer. I had expected either a simple "Yes, we'll waive the fee," or a "No, we won't waive the fee." This wasn't quite either of those. This was "Yes, we'll waive the fee, but we'll need you to spend a little bit on the card for us first."
After thinking about it for a few moments, I took the deal. I would simply put on that card $100 worth of purchases that I had planned to make anyway. For doing that, I'd get the cost of my annual fee waived and keep the card that I liked and the perks that go along with it. I couldn't see a downside for me.
[See: 12 Simple Ways to Raise Your Credit Score.]
The moral of this story is simple: If you want something from your credit card issuer, always, always ask. You won't always be successful, especially if you ask too often or for too much. However, the truth is that your chances of success are far better than you'd expect in this hyper-competitive credit card marketplace, especially if your credit is strong.
Matt Schulz is the senior industry analyst at CreditCards.com, a site dedicated to helping people make smart decisions about obtaining and using credit. You can follow him on Twitter at @matthewschulz.
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