Signing up for credit cards to earn huge miles and points is exciting as you earn lot of Free Travel but one big drawback with is that they come with an annual fees. Most credit cards do not have annual fees the first year just like honeymoon where everything is rosey and fine!! It’s the second year you have to pull up your socks and call the bank to either cancel the card or negotiate the annual fees. You should not cancel too many credit cards after earning the bonus in the first year because bank does not consider you a lucrative customer and it may reduce your chances of getting approved for credit cards later, consider converting it to a no annual fee card. This may help you keep a healthy credit score by not lowering your average age of credit. If you have to absolutely cancel the card then make sure you transfer the credit card limit to another card from the same bank. This will help you keep a healthy credit.
Carefully evaluate the benefits associated with the card and then make the decision. But hey the second year may not be necessarily that bad if you follow a few tips I’m about to share to negotiate credit card annual fees. Here is a transcript from my phone call this morning to Barclays to waive annual fees of the recently converted US Airways credit card to the AA Red Aviator Mastercard
My Call :
She – Hello, I am XYZ How can I help you?
Me – I just saw that my credit card was charged for the $89 annual fees. I am not too certain if I should keep the credit card and was hoping you could assist me in keeping this card by adjusting the annual fees.
She – Certainly, let me see what I can do. Can you please hold?
Me – Sure
After a minute silence
She – Sir, I will transfer you to a relationship manager who will assist you further
Me – OK, Thanks
Manager – Good Afternoon, Mr Desai How can I help you?
Me – The lady I was speaking with transferred me to you and she said you could help me waive off the annual fees on my credit card
Read carefully – I am putting words in his mouth. I pretended as if the lady who was helping me first had already agreed to waive off the annual fees and now the manager thinks I am speaking with him to seal the deal.
Manager – Sure Sir, I can waive off the annual fees for you. You should see the refund on your annual fees in next 3-5 business days. Is there anything else I can assist you with?
Me – Great, Thanks (with a BIG HAPPY GRIN). Could you check if there are any bonus spending offer on my credit cards?
Manager – Let me check.
After a brief pause
Manager – Sir, I can offer you 15000 Bonus miles if you spend $500 each month for the next three months. Will you like to accept this offer
Me – With a much bigger smile – absolutely. Are there any other offers?
Manager- Yes, there is an additional offer where you can earn 2X miles up-to 1000 miles each month for the next three months when you shop for groceries, gas and utilities using your Aviator card. Will you like to accept this offer as well?
Me – The smile is getting even bigger – ABSOLUTELY.
Manager – Read some T&C
Me – Thanks appreciate your help and I hung up
Just after a 5 minute phone call not only I was able to keep the credit card open but have my annual fees of $89 waived and earned 15000 bonus AA miles after completing a simple spending offer.
By simply calling the bank I was able to get the $89 annual fees waived on the Barclay Aviator Red Mastercard and was offered additional offers to earn 15,000 AA miles. My Indian genes probably played a big role in helping me waive off the annual fees. This may not work all the time but you should always call and check what banks can offer. Remember, it costs banks a lot more money to find new customers so you definitely have an upper-hand especially if you spent quite a bit on the credit card. But remember you need to call either before your annual fees is charged or the within a few days, dont procrastinate.
Here’s the rundown on the time banks will let you waive off the annual fees:
- American Express – Can be waived for up to 1 billing period after the fee is assessed, and prorated on an 11 month basis after.
- Bank of America – No set policy, though generally if you pay your balance off and close an account a fee waiver could be considered
- Barclaycard – 60 days after the fee hits.
- Chase – Many cards give you 60 days after the annual fee hits your account, which is often on the 1st of the month. There are some exceptions. United co-branded cards for example have a generous 180 days during which you can get the fee waived if you change products or cancel.
- Citibank – 30 days after the statement with the fee is generated. After that it can be prorated based on what month you make your decision.
- US Bank – 30 days after the charge is assessed.
Still confused? Have a question?
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