Credit Cards Archives - Page 3 of 10

Apr 25 2017

Chase Sapphire Reserve for Dummies

I came up with a brilliant idea the other day. Write about a credit card almost half a year after everyone stopped hyping it! People will love it! Joking aside, a friend of mine, who will remain unnamed to protect her innocence, apparently did not know the Chase Sapphire Reserve offered a Global Entry credit. So she stood in line for forty five minutes watching her parents breeze through TSA Precheck. A lot of people who signed up for the Chase Sapphire Reserve have dipped their toes into the miles and points game for the first time with this good card for beginners.

If you’re one of those beginners (aka one of my tens of real life Facebook friends), here’s how to get the most Chase Sapphire Reserve value. If you’re one of the many experienced hobbyists who reads this blog, feel free to tell me why my advice is terrible!

Consider this a rough guideline of benefits you should take advantage in the first year of card membership. I’ve semi-ranked these benefits in order of importance, though of course I’m subjective and you need to adjust to your own life situations. Also, I’m assuming this may be your first foray into the miles and points world. Remember, the card carries a $450 annual fee that gets charged within the first month or two of card membership, so your goal should be to make that fee “worth it”. Hope this helps you to do that!

Meet the minimum spending towards the sign up bonus

When the Chase Sapphire Reserve first hit, everyone frothed at the mouth at the huge sign up bonus. While the bonus decreased to 50,000 points after $4,000 in spending, the card still presents a lot of value for beginners. So make it a priority to focus on spending that $4,000 in three months. Hopefully someone has told you to make sure you pay your balance off in full. If you’re getting charged interest you’re basically negating all the value you would get!

I’m not going to tell you how to spend $4,000, but you probably had a plan going in. When I first started out I usually signed up for a new card when I knew I might have a big purchase coming up (insurance payment, vacation, etc.). That’s a good way to bang out a chunk of the minimum spend. Anyway, make sure you have a plan for this first that doesn’t require you buying a bunch of crap you don’t need!

Use your $300 travel credit

I’m assuming you got this card to make traveling a little cheaper. So make sure you use the card to pay for travel expenses. The first $300 will be reimbursed. Chase applies the travel category pretty liberally, meaning you can get this credit for plane tickets, trains, hotels, even taxis and subways in some cases. You don’t have to worry about the credit, it gets automatically applied, usually within a couple of days.

To check how much of the credit you’ve used, navigate to the Ultimate Rewards page of your online account at chase.com. Here you can check your balance information and how much of the travel credit you’ve received.

Here's a guide to help you get the maximum Chase Sapphire Reserve value if you're one of the many new people to get this card. — 31 points only? Gotta work harder

Use the card overseas (no foreign transaction fee)

If you travel overseas, make sure you use the Reserve to pay for stuff. It doesn’t charge a foreign transaction fee which means you don’t get charged extra. Just make sure to pay in the local currency otherwise you’ll get charged a mostly hidden fee. Part of your annual fee goes into eliminating the foreign transaction fee. Take advantage of it!

Sign up for Global Entry and get TSA Precheck

Global Entry enables you to get through customs quickly, and the Chase Sapphire Reserve offers a $100 credit for the application fee. But a lot of people plan to stay domestically for the travel. They then assume that Global Entry has no use to them but don’t realize that it also qualifies you for TSA Precheck. Or some people think going into the airport for an interview presents too much of a hassle.

So let’s ask a question, an honest one. What will be more of a hassle for you in the next 5 years? (That’s how long Global Entry lasts). Going to the airport for the interview, or taking out your laptop and taking off your shoes every time you fly. Not to mention the aforementioned line! If going to the airport really hassles you more, then I guess pass on Global Entry. (Or if you live in stupid Boston which has no interview availability for the next 500 years).

If you have trouble finding an interview, you can schedule at airports other than your home airport. I wasn’t joking about Boston’s availability, but I scheduled for Newark which tends to have a lot of space. Though you have to go to Newark…

Use the Chase Sapphire Reserve for your rental car

The Chase Sapphire Reserve (man I’ve typed that so many times imagine if I sold cards!) helps rent cars in multiple ways. First, you can get Avis Preferred and National Emerald, which mostly helps you cut lines. That matters in airports like MCO. Secondly, you can use the Reserve’s discount rate to get 25-30% off your rental reservation. Finally, Chase Sapphire Reserve offers primary car rental insurance.

That means if you get into an accident, Chase Sapphire Reserve covers you first. If that’s not enough, then you go to your regular auto insurance policy. (Cards that offer secondary insurance are the opposite.) So unless you visit excluded countries (Ireland and a few others), you can happily waive the collision damage waiver companies want to charge you.

Fall back on other coverages when necessary

I’m not going to go through all the benefits, you can find them here. I will point out that the Chase Sapphire Reserve offers Trip Cancellation/Interruption insurance, Lost Baggage insurance, Baggage Delay insurance, Roadside Assistance, and various emergency insurances when traveling. If you’re new to miles and points, just put everything on this card – you might be protected and not even know it. If something goes wrong, it’s more than possible the Reserve has you covered. You can check out Free-quent Flyer’s experience with the Preferred trip deal coverage here, Reserve coverage is equal or better. (He also describes trip delay insurance here.)

Enroll in Priority Pass

Priority Pass is a decent, but not great lounge benefit. Still, you might get access to lounges in a few places (I think I’ve used it…twice?). You get two companions to go in with you so that’s nice too. You need to activate this. The easiest way? Go to this page, then click on “Learn More” under Lounge Access. Login and it’ll bring you to the page below, click activate now, profit.

Transfer points to partners or use to pay for travel?

To me, you can get the most value out of your points by transferring to partners like Hyatt, United, or Korean Air. For example, if you can rent a $500 room for 25,000 points transferred to Hyatt, you get a value of 2 cents per point.

But maybe you don’t define value in fancy hotel rooms or first class flights (I don’t think everyone should). Then you can use the Chase Travel portal to book flights for a value of 1.5 cents per point. That means your 50,000 point sign up bonus is worth $750 towards travel. Families on a tight budget should definitely consider this, though you might want to avoid booking hotels through the portal.

Most important rule? Use your points. You can’t take them with you and there usually isn’t a good reason to hoard them. They’re worth nothing until you redeem them, so just use them in any way that makes travel less expensive for you and your family.

Final Thoughts

Hopefully this gives a good overview of the benefits you can get with the Chase Sapphire Reserve. It’s a great card and I’m likely to keep it next year (though I’ve canceled/downgraded a bunch of cards since I realized how much I was paying in annual fees!). I’m fairly certain I can squeeze $150 of value out of it (after you subtract out the $300 airline credit).

So, were there any great benefits I missed? Let me know!

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Mar 25 2017

Easy travel rewards for non hackers

One of my favorite Saverocity personalities, Robert Dwyer, and I both enjoy listening to the Mighty Men of Mouse podcast (Disney stuff). On Episode 306 they had a brief discussion about travel rewards. Their sensible conclusion was that they don’t want to expend the mental bandwidth to keep track of it all. Travel hacking takes a lot of mental bandwidth (otherwise you might make potential costly mistakes), and I’m experienced enough now to know it’s pointless trying to convince people the value they present. But I thought it might be fruitful to discuss some easy travel rewards that don’t require a lot of mental bandwidth.

Travel reward programs can be complicated and confusing. But here are some easy travel rewards programs that you can use to save money on your travel! — If you can handle this, you can probably handle some simple travel rewards

A couple of notes. First, I think it’s perfectly reasonable for people to think they don’t want to expend the mental energy required to keep track of a million award programs. We all have our hobbies. Secondly, the easy travel rewards programs I’m discussing in this post don’t necessarily represent the most monetary value. Instead, they present travelers the opportunity to save money casually – without being insane like some of us.

I’ve split the rewards programs into categories, moving from simpler to more complicated within each category (in my opinion).

One organizational step – get a good password manager

While you can save money on your travel expending very little mental bandwidth, you should really get a good password manager before you get started. I use Lastpass, which will autofill my passwords in for me when I’m logged in – that saves a lot of mental time and effort.

Of course programs like Award Wallet really help too, but the simple easiest thing you can do is use something like Lastpass. That way you don’t really need to remember any of your logins and passwords.

If you’re paranoid about security, you could always make a spreadsheet for yourself, but that will really hurt your bandwidth. Programs like 1Password, which cost money, might be worth the cost in bandwidth saved alone.

Airline Rewards

If you’re flying, I find it easiest to focus on fixed value rewards programs like Southwest and Jetblue. That way you never need to worry about different award levels, demands on space, etc. etc. Each point you earn from Southwest or Jetblue has a monetary value to it. In fact they make redeeming the points a simple matter of clicking on “points” instead of “cash” when you search.

One feature propels Southwest to the top of the “easy to redeem” list: fee free cancellation. You can cancel or change your ticket any time up to 10 minutes before your flight. While you don’t get the money (or points) back to your account, you can apply that credit to future travel on Southwest.

One reason casual travelers avoid airline rewards is it’s hard to keep track of your frequent flyer number and how many miles you have. Solve that problem using the password manager you installed above. With Southwest or Jetblue, it doesn’t even matter how many miles you have since you can pay with cash or points – just try to pay with points every once in awhile and you’ll be saving money! The amount of bandwidth required to do this is only the amount of bandwidth you need to remember to login.

Hotel Rewards

While I’m not a huge fan of the program, I have to admit: hotels.com 10th night free program remains the easiest hotels rewards program. Basically, as long as you book all your hotels through their site you will earn one free night for every ten nights you purchase. Credit towards free nights expire in 12 months if you don’t redeem or stay within that time period.

The value of that free night will be equal to the average of the cost of the ten paid nights. It doesn’t get any easier than that, bandwidth wise. Also, Disney fans – you can book Disney hotels through hotels.com and redeem free nights at Disney.

Orbitz also has a rewards program – you earn 5% back for hotel bookings and 1% back for airline bookings. You can only use the rewards for hotel stays and all rewards expire in 12 months regardless of activity. The benefit of this program lies in being able to redeem more quickly (i.e., you don’t have to wait until ten stays).

When it comes to simple options, these hotel rewards are as simple as remembering to login and remembering to have activity once a year. Minimal mental bandwidth!

Credit Card Rewards

I swear I do not have affiliate links, but I still think the Barclays Arrival Plus card remains one of the easiest cards to use for travel rewards and a great card for travel hacking beginners. However, the annual fee scares casual travelers looking to save money and I get that. But if you think the $89 annual fee is worth the decreased bandwidth, then 2.1% redeemed towards travel will be pretty good for rewards.

Another great option is the Bank of America Travel Rewards card which comes with no annual fee. If you are a Platinum Honors Preferred client you’ll get 2.625% back per dollar spent, otherwise you’ll get 1.5%. Capital One Venture offers 2% back as well but with a $59 annual fee. All three of those cards are easy to use because you just redeem points against your travel purchases.

Of course the best option for the casual traveler? Invest in a 2% cash back card. The Fidelity Visa and Citi Double Cash both offer 2% cash back for no annual fee. But these options aren’t as “casual” because you need to mentally organize your money and dedicate that to your travel. Or alternatively, you can tell yourself to feel better about spending money on travel since you’ve been earning 2% back. Either way, it’s not as “clean” as the travel rewards card options.

Credit cards of course require more bandwidth than either the easy travel rewards from the airline or hotel programs I listed above. You need to keep track of things and you need to pay your balances off in full. What you receive in return for that extra bandwidth comes in the form of more savings, including savings you can “stack” (you can earn 2% cash back if you use your Fidelity card at hotels.com on top of the free night you are working towards).

Car Rental Rewards

One quick note here: it’s worth it to sign up for car rental programs. All you need to do is remember your number and add it to your reservation and you can generally skip the lines when picking up the car. All the different companies have different names but for the most part, have an account with them, skip the line. This even works sometimes for me when I book through sites like Priceline (even though it shouldn’t per terms and conditions). Worth the mental bandwidth especially in a place like Orlando where car rental lines are nuts.

Final Thoughts

Again, while these programs won’t save you the most money, they are some of the simplest programs to use. If you’re traveling a lot, why not at least give it a shot. Every dollar counts – if you save $50 that’s like…ten Mickey bars!

Any other easy to redeem programs I missed?

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Travel reward programs can be complicated and confusing. But here are some easy travel rewards programs that you can use to save money on your travel!

Mar 23 2017

Save your gift card receipts – and thus you shall be saved

I experienced the nightmare scenario the other week – a lost gift card. Two, to be precise. I had loaded of these Simon gift cards with the standard amount. I remember taking them out to use and then finding my desired purchase at Staples out of stock (shocker).

Fast forward a day and I looked for the cards in my bag and couldn’t find them. Nor could I remember anything I had done with them! My brain obviously lacks the processing power it once had, if any. Anyway, here’s how I handled the situation and how I could have made my life so much easier.

Quick aside, I always debate writing about stuff like this because

I’ll likely get grief from my wife telling me I’m a moron
I’ll likely get grief from the community telling me I’m a moron

But hey, if I help people avoid a similar situation, it will be worth it. I’m a moron, might as well learn from my mistakes!

Contacting Simon Gift Card Services

Did I mention the gift cards were in the bag with the gift card receipt in it? This story gets more embarrassing by the minute. Anyway, I didn’t have the receipt but Simon has an incredible customer service team. I’ve taken a screen shot of the relevant information from the Simon help section:

So if I had registered my gift card I would have been able to access the number no problem, but that’s way too time consuming and I would never do that. Obviously what I should have done was keep my receipt separate – I used to be very good about this but got lazy as I got more experienced. Pride comes before a fall, as they say.

Anyway, I did exactly what the highlighted section suggests: I e-mailed Simon and gave them the date I purchased, the number of cards purchased, load amounts, and the last four of my credit card number. I also included the last four digits of other cards I had purchased in the same transaction.

I received an e-mail the next day asking for some more information – issuing bank of my credit card and type of gift card which I had some how forgotten to put in my first e-mail. After replying to that I received an e-mail within the hour with my receipt attached. That’s customer service.

Why having your receipt matters

Once I had my receipt, everything was pretty simple. Simon customer service wrote back with this helpful e-mail:

“I have attached the receipt from that transaction. You will need to call Visa Cardholder services at 1-866-325-6238 with the proxy numbers (numbers starting with 60395) to get the actual card number as we have no way of obtaining those. You can compare those numbers to your records to find the card number of the ones you lost. Please discuss replacement cards for the lost giftcards with Visa as well.”

I made a quick phone call (amazingly quick, really) and spent a couple minutes figuring out which cards were missing. Once we figured it out, the two cards I lost were canceled and they sent out replacement cards.

Basically, your activation slips that you receive with your cards have proxy numbers that match up with the cards that you have bought. As long as you have those, you should be able to be made whole. While I doubt other companies are as quick and helpful as Simon was (they might be!), as long as you have those activation receipts you don’t need to panic. And if it’s Simon and you keep good enough records you should be able to get a copy of the receipts anyway.

Avoiding this in the future

Don’t be a moron (me)
Save receipts and keep them separate from where you keep the cards
Sign up for digital receipts if you can (CVS)
Use your cards quickly
Stay calm
Only float money you can afford to lose

Final Thoughts

While not an ideal situation, I’m thankful Simon customer service was so on top of things and that I was able to be made whole in relatively quick fashion. Oh, and the kicker? TURNS OUT MY BAG HAS FOUR POCKETS NOT THREE. Yes, I spent two days trying to locate these lost cards and somehow, despite checking my bag six times, never opened that fourth pocket. I blame the fact that I had to get a new backpack. And I’m sure you know what I found in there…

Bottom line: I’m a moron.

But if you ever have lost gift cards, you don’t have to be.

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Mar 17 2017

Best Travel Credit Cards for Beginners

Anyone who writes in this space inevitably gets asked, “So, what credit card should I sign up for?” Experienced vets know that’s a very complicated question, dependent on your travel goals, budget, liquidation bandwidth (if applicable), family size, etc. etc. But that won’t stop people from asking the question, so I thought I’d put together a list of my best travel credit cards for beginners. Easier than typing the same e-mail over and over.

Note: I do not have credit card links, therefore every link to a credit card in this post earns me $0. They are literally the links I found from Google.

Before we start, one quick note. Freequent Flyer made an astute comment to me the other day (paraphrased): “Sometimes I recommend certain credit cards to people because if they can’t even handle one or two new credit cards, they can’t handle playing this game in full.” (He’s also written on similar themes here and here).

This is the stark reality. Playing the travel hacking game often requires juggling a lot of different things at once; it challenges even the most experienced. You need to keep track of your annual fees, avoid falling for the sunk costs fallacy, manage tens of different accounts – the mental space required can be exhausting. I’m at a point in my life where I’m simplifying my game, not expanding it.

So these credit card recommendations come with those things in mind. They provide you options to save money on your travel, but will also help you determine how equipped you are to handle the game. Baby steps, as it were. There ain’t no shame in not getting deep in the game – better to save a little money on travel than waste a lot of money due to disorganization. And yes, please do remember to pay your statement off in full every month – otherwise your rewards will cost you way more than you think.

I’ve organized these cards from least to most complicated – the further down the list you go, the more mental energy you will need to glean maximum value. Remember, the best card is the best card for your situation. Hopefully my descriptions will help you determine that.

Barclays Arrival Plus

My mother in law texted me the other day alerting me to a 50,000 point sign up bonus for the Barclays Arrival Plus card. This card used to be hot hot hot, but nobody really talks about it much anymore as it presents less value than in the past. Still, the Arrival+ represents a great entryway into the game for beginners. You need to spend $3000 within the first three months to earn those 50,000 points – can you organize your spending in a way to accomplish that without purchasing more than you normally would?

The Arrival+ is a classic “cash equivalent” card. The points that you earned can be redeemed against your travel purchases for statement credits. Any travel purchase you make over $100 can be “zapped” through your online credit card account website with Barclays. Each point represents 1 cent of value, so 50,000 bonus points can subsidize $500 of your travel.

You also earn 2 points per dollar you spend along with a 5% rebate of points spent. So the Arrival+ functions effectively like a 2% cashback card, albeit one whose “cash” you need to spend on travel. But you can use that to travel anywhere you want to go, just plan your vacations as you normally would and make sure you use the Arrival+ to pay for it.

Some downsides include the need to make a > $100 purchase before redemptions. Also, unless you are a huge spender, the $89 annual fee (waived first year) isn’t really worth it, so this card will give you practice in canceling cards or asking for retention bonuses.

Why card is good for beginners

plan travel as you normally would, use Arrival+ to pay for it and earn a statement credit

Skills practiced

organizing spending to earn a sign up bonus
redeeming cash equivalents for flights
canceling cards/getting retention bonuses

Downsides for beginners

must redeem for at least $100 in travel purchases, can be tough for some
may not be worth keeping for more than one year causing more work for a beginner

Discover it Miles

It’s a bit weird to me to put a no annual fee card down as “more complicated” than an annual fee card like the Arrival+ but bear with me. Discover it Miles presents a fairly simple reward scheme. You earn 1.5 points per dollar spent, those points can be redeemed for cash or a travel credit. The travel credit works very similarly to the Arrival+ credit.

One thing that makes this card more “advanced” is the introduction of the option of cash or travel credit. Ostensibly, these credits can be used the same way. The question becomes how do you organize your finances mentally? Are you setting aside your rewards for travel or are you redeeming for cash back if your finances warrant it.

Note – I think if you need the cash, you probably should be redeeming for cash back not travel. Maybe you shouldn’t be traveling in the first place. Or maybe you should! I don’t know your situation. The point is, once the option of redeeming for straight cash back is introduced, you get to start making decisions based on your priorities and goals. That represents higher order thinking in travel hacking.

In fact, I ignored a great 2% cash back card, the Fidelity Visa, when I introduced the Barclays Arrival+. But you could just earn money on a cash back card and set it aside for your travel expenses, if you can organize yourself that way.

One final note on Discover it Miles – your rewards are doubled after your first calendar year. So you effectively earn 3% back that first year, introducing you to another hallmark of travel hacking: hitting certain deals hard for the limited amount of time available.

Why card is good for beginners

no annual fee
easy to redeem rewards for cash back or travel credits
plan travel as you normally would

Skills practiced

deciding between redeeming for travel or cash back
hitting a good deal hard (double bonus the first year)

Downsides for beginners

little to no sign up bonus (can get $50 from a referral)
may be tempted to just take the cash back instead of use for travel (only a downside if your goal is to travel more)

Chase Sapphire Preferred

The Chase Sapphire Preferred (CSP), like the Arrival+, fell out of favor to some degree. But it’s still a great card for beginners! Currently, you need to spend $4000 in the first three months to earn the 50,000 Ultimate Rewards point bonus. For the extra $1000 you need to spend (over the Arrival+), you gain quite a bit in value.

First, you can use your Ultimate Rewards to book travel through Chase’s travel portal. If you do that, you will get 1.25 cents of value per point. So as a cash equivalent currency, your Ultimate Rewards points get you more than your Arrival+ points. You can use 50,000 point bonus for $625 worth of travel ($125 more than Arrival+).

Secondly, the CSP also gives you the ability to transfer your points to travel partners. You can transfer miles to a lot of go-to programs for travel hackers, including but not limited to British Airways, United, and Hyatt. Thus you have more options for how you want to redeem your points.

This brings you to the next level of travel hacking – you can learn to start making decisions about how to get the most value out of your points. More options means more potential value but also more mental energy devoted to value proposition determinations.

Do note that you only earn one point per dollar spent (2 points on travel and dining), so your regular earning rate isn’t as good. However, after the first year (and it’s waived $95 annual fee) you can easily downgrade the card to a Chase Freedom Unlimited (1.5 points per dollar), though you will lose a lot of the travel benefits.

Why card is good for beginners

easy redemption for $625, but the option to branch out into using loyalty programs
card can be downgraded to Chase Freedom Unlimited after first year

Skills practiced

organizing spending to earn a sign up bonus
redeeming cash equivalents for flights
transferring points to travel partners
canceling cards/getting retention bonuses OR downgrading to no annual fee card

Downsides for beginners

regular earning rate of only one point per dollar
learning how to use different loyalty programs can be confusing (too many options)
$4000 in 3 months may be a lot for a beginner

Chase Sapphire Reserve

I hesitated putting the Chase Sapphire Reserve on this list but ultimately decided that as a potential training tool it fits the bill. Up front you should know this card carries a hefty $450 annual fee, not waived the first year. In terms of benefits, it pretty much mirrors the Chase Sapphire Preferred. 50,000 point sign up bonus after spending $4000 in three months, the ability to transfer to travel partners, and the ability to use the points to book travel through Chase.

The Reserve does offer you 1.5 cents per point used towards travel through Chase, better than the Preferred’s 1.25 cents. The real reason I put this card on here is the $300 annual travel credit you get with the Reserve. Lots of premium cards come with this credit, the Reserve makes it the easiest to redeem. Basically any purchase you make that codes as travel will get reimbursed up to $300 per calendar year. (Note: Make sure you use up all $300 before your December statement closes).

You can get this travel credit twice in your first year of card membership, something travel hackers like to take advantage of. Then you get to practice determining whether a card is worth keeping, downgrading, or canceling. Personally I’ve decided to keep this one. Either way, you’re juggling all the skills you can hone with the Chase Sapphire Preferred with the added challenges of managing the travel credit. Thus I believe this to be the most complicated card I’m recommending for beginners, but it can really jumpstart your skills in this game.

One final note on Chase. They won’t approve anyone who has gotten more than 5 new credit cards in the last two years. That’s why conventional wisdom states go with Chase first. I mostly agree with that conventional wisdom but it’s highly dependent on how deep you plan on going in the game. Of course, nobody ever plans to go neck deep from the outset, so…

Why card is good for beginners

easy redemption for $750, but the option to branch out into using loyalty programs
card can be downgraded to Chase Freedom Unlimited after first year
practice earning travel credits

Skills practiced

organizing spending to earn a sign up bonus
redeeming cash equivalents for flights
transferring points to travel partners
earning travel credits twice in first card year
canceling cards/getting retention bonuses OR downgrading to no annual fee card

Downsides for beginners

regular earning rate of only one point per dollar (though 3X on travel/dining)
learning how to use different loyalty programs can be confusing (too many options)
$4000 in 3 months may be a lot for a beginner
can be confusing juggling travel credits
$450 annual fee very expensive if you don’t get the value back

Final Thoughts

I’ve changed quite a bit since I started this blog years ago. Now that I have a family, I recognize how great cash back cards can be in their simplicity. Earning 2% cash back on every purchase is great for travel, if you set that money aside to travel! Cash back cards notwithstanding, the cards I recommended above are some of the easiest entry level cards I can think of for beginners. Each card will help you practice a different skill that you can build on to save further on your travel budget. Feel free to e-mail me anytime with questions, but note I’m not financial professional, just giving my opinion from experience.

For you old timers out there, what card would you recommend to a pure beginner?

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Mar 11 2017

Credit card annual fees worth paying

Early this week, I started taking stock of my annual fee cards. Although all my annual fees hit at different times throughout the year, I found myself asking “How many annual fees do I actually have and are these credit card annual fees worth paying?”

What sparked this? The annual fees on both my Citi Prestige and American Express Platinum are due this month and I realized that I have a lot of high annual fee cards. I somehow ended up with three Platinums in the past calendar year, something I need to rectify soon.

Anyway, in my mind there are two ways to evaluate annual fees. You can evaluate the benefits and whether they are worth the fee, or you can evaluate the fee in light of how much benefit you can glean from the card via MS.

For our family, I’ve basically decided that the MS stuff is a wash – I’m never going to MS enough to make any credit card annual fee worth paying. That’s just not my game. If that’s a factor it’s just gravy. It all comes down to whether the annual fees benefit my family. Here are the annual fee cards I have and how I personally decided whether they were worth paying or not in light of our family’s situation.

IHG Card ($49)

Everyone says these IHG credit cards have credit card annual fees worth paying. I’ve only heard one contrarian view (Freequent Flyer) that I can remember, but I’m starting to come around to that view. My wife and I each have this card, so we have two free nights between the two of us.

You’d think this be ideal but between the fact that we travel less than we used to, our unflinching loyalty to Hyatt Diamond (sarcasm, but we did migrate many stays in that direction), and our favoring apartment rentals more, these free nights have become much more difficult to use. I ended up using our 2016 credits for my in laws, which I’m happy to do of course but which is also indicative of how often I have a chance to book these nights.

This card often gets praised for the ability to redeem a room at an Intercontinental for $49, but that’s not really realistic for my situation. Still, I’m enamored with the free night (or the idea of it?) so I’m keeping this card.

Bank of America Alaska Air ($75)

There’s a companion pass, but I’m actually not sure why I haven’t cancelled this card yet.

Barclays AAviator ($89)

I keep telling myself 10,000 anniversary miles a year make the $89 annual fee worth it. I’m not sure why, though. The fee also gets mitigated by free check bags, which we use quite a bit as a family.

Chase Ink Plus ($95)

I earn enough Ultimate Rewards points at office supply stores to justify this annual fee. People often compare cards like the Ink Plus to 2% cashback cards, which is a good rule of thumb. However, I’d never MS that much on a 2% cashback card so I personally don’t use that criteria. Remember, just because it makes logical sense doesn’t mean you need to apply that criteria, especially if it doesn’t apply to your situation.

American Express Delta Gold ($95)

I strongly considered canceling this card last year, but decided that the odds of the family taking two domestic roundtrips on Delta were high enough to keep the card. Checked bags for four segments cost more than $95 so the fee pays for itself. Now I couldn’t guarantee that we’d take that many trips on Delta, so I inherited some risk keeping the card. It worked out this year but I’ll have to reevaluate again for the coming year.

Barclays Jetblue Plus ($99)

Checked bag fees factor in again here, but the big reason why I’m keeping this card is the ability to earn Mosaic status with $50,000 in spend. I fell in love with Mosaic status last year when I status matched, mainly due to the ability to cancel tickets without fees. This comes in super handy for family travel, because when you book 4 tickets being able to change to a lower price without a fee is incredibly clutch. This will be the first time I’m earning status via spend – should be fun!

Citi Prestige ($350 due to Citigold)

I consider my Citi Prestige a $100 fee due to the $250 airline credit I end up getting every year (it’s so easy to redeem). So the question I ask myself is whether I can get $100 back from the fourth night free benefit. This proves harder than you would expect, because we don’t often stay four nights in one hotel (plus the factors I mentioned for the IHG card). Like the Delta Gold, I’m gambling that I’ll use the benefit which will cancel out the annual fee. If saving money was my only priority, this would be easier, but I can’t use the fourth night free benefit as much as others might because hotels don’t always make sense for my family.

Chase Sapphire Reserve ($450)

Like the Citi Prestige, the $300 travel credit on the Chase Sapphire Reserve isn’t difficult to use. So the question I ask myself for this card is whether the card justifies paying $150. Since I’m keeping the Ink, I don’t need the Reserve in order to transfer points to travel partners. So most of the extra value I can get from this lies in the ability to get 1.5 cents per Ultimate Reward point on travel. However, since I already get 1.25 cents per UR through my Ink card, the marginal benefit is only 0.25 cents.

So to make up the $150 I’d need to spend at least 60,000 Ultimate Rewards points towards booking travel. That’d be worth $900 with a Reserve and $750 with just an Ink. I’ll be booking four tickets per trip starting in July so that’s not unrealistic, though put a pin in this for later.

American Express Personal Platinum ($450X2)

Nevermind why I grabbed these cards, the $200 airline credit just doesn’t cut it anymore. I never use Ubers, which AMEX uses to justify it’s upcoming increase of the annual fee to $550. We totally panned these “enhancements” on Episode 50 of the Saverocity Observation Deck podcast so you can hear my full thoughts there, but basically, so long AMEX Personal Platinum cards. Oh, and how could I forget their middle finger towards families!?

American Express Business Platinum ($450)

I’m totally on the fence about this card though I don’t have to decide for awhile. I’m fairly certain I can glean $250 of value out of the 50% points rebate, but I’ll need to do some more thinking about this. That leads me to my final point though.

It’s impossible to evaluate these cards in a vacuum – time to be realistic

You’ve probably noticed a fairly large flaw in my evaluations here. Well, if you’re a parent you probably have. Now for a family with two kids under 5, our family travels quite a bit, despite how messy it can get.

But let’s add up what I need to do to justify all these annual fees (of the cards I’m leaning towards keeping):

2 nights in IHG properties
2 domestic roundtrips on Delta
Some Jetblue flights to justify earning Mosaic
A four night stay with Citi Prestige that saves me at least $100
At least $900 in flights booked through Chase Travel with the Reserve
At least $500 worth of travel booked through AMEX Travel with Business Platinum

If I can do all those things, I’ll at least break even on the FIFTEEN HUNDRED DOLLARS of annual fees across those cards. But almost all these benefits are mutually exclusive. I can’t fly Jetblue and Delta at the same time. If I’m booking through Chase Travel, I can’t use my Mosaic status.

To use all these benefits I’m looking at a minimum of three domestic trips realistically. Combine that with our travel goal of one or two international trips (which probably don’t factor into these valuations at all since we try to book those in business class or above), and my travel demand schedule for the year is maxed out at best or exceeded at worst.

Put simply, we probably won’t fly enough to justify all these cards. Especially considering we’ve already completed two of our domestic vacations and booked the international one! So I’m going to be making some cuts in the upcoming months, despite what I said above. My comments above evaluated each card in a vacuum, but I can’t really do that, can I?

Final Thoughts

My one thing I hope people take away from this post? It’s easy to justify paying the annual fee on almost every single card you can get. But make sure your justifications don’t operate in a vacuum. They need to reflect your actual travel goals and capacity.

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