Annual Credit Card Fee: How to Decide if It Is It Worth

The annual fee is how a lot of?

I’m not the only one asking about this when I’m a newbie in the credit card world and saw the fees on premium credit cards for the first time. Many of these annual fees are high at $500, which is a fair response.

If you actually say this to the person who pays this, they may soon tell you how the card makes their lives better and why they pay hundreds of dollars in privileges to use it every year.

In many cases, we do get much more value from the card than we pay for the annual fee.

However, as the card landscape changes, we see many cards refreshes with longer benefits lists and receive annual fees. That’s the case with Chase SapphireReserve®, which is making many changes with this year’s $795 annual fee (although the current annual fee is still $550).

With this news in mind, how do you determine if the card’s annual fee is worth paying? That’s how we break it down.

View your card portfolio

After evaluating the values ​​you actually get from the card, check out your entire portfolio. It is often easy to justify that the annual fee for a single card is enough time, and you can pay a lot of fees every year with multiple cards.

Take a look at the benefits of your card and consider the following.

What are the benefits of not using it?

It’s easy to get excited about a card and apply for it, just find that you’re not maximizing what it offers. Please note that if there are points you have forgotten to use or no longer need them.

Where do I have the benefits of overlap?

If you have been using a credit card for a while, it is very likely that you have some duplicates of the same interests. Consider whether you have multiple cards that give you the same elite status, global admission or TSA Precheck credit or lounge access.

How has this card been changed since I got it?

While some cards have changed significantly over the past few years, others have lost one or two benefits recently.

If you get PlatinumCard® from American Express, in part because its annual $240 Digital Entertainment Statement Credit* covers your auditory subscription (no longer available) or Chase Sapphire Reserve in Priority Pass restaurant visits (no longer available), benefits changes to these cards may play a role in determining whether their annual fees are worth paying.

*Register required; automatic renewal.

Consider card declaration credits

One of the easiest ways to determine if a card fee is reasonable is to check the value of the card’s available statement credit.

For example, we regularly point out that if you can take advantage of the number of annual statement credits, it is easy to make sense for the American Exprion® gold medal annual fee of $325 (see Rates and Fees). This seems to be simple math, but you need to do some other research before jumping.

If you are like me and have already spent a lot of budget on takeaway, the points of Amex Gold are easily maximized.

When I order Uber meals, I use up to $10 in Uber cash and will be able to declare a credit of up to $10 per month for meal statement when I order through GrubHub (registration is required). However, if you don’t order takeout or ride a bike with Uber frequently, you probably won’t maximize these credits, and the annual fee may not be worth paying. When you add Amex Gold as a payment method and redeem it with any Amex card, Uber cash is deposited into only one Uber account. Uber cash is valid for US purchases.

Related: Who should (who shouldn’t) get Amex Gold?

Is the credit limit for something you have already spent?

If you haven’t spent money on your card that will give you a credit limit, then the card won’t save you any money.

For example, Amex Platinum has an Equinox declaration credit of up to $300 a year (automatic renewal is required; registration is required). If you are currently out of pocket to pay for the Spring Equinox membership, this will effectively give you $300. If not, you will end up spending more money on leveraging credit instead of you having no card (or membership) at all.

Are points easy to use?

Furthermore, not all credits are equal.

For example, both Capital One Venture X Rewards Credit Card and Chase Sapphire Reserve have $300 annual travel credit. The credit of Sapphire Reserve is automatically applied to any code as a purchase of a trip – as long as you spend money on your trip with a card, you will almost certainly use credit.

As for the credit of the Venture X, it can only be used for travel booked through Capital One Travel. This means at least, you have to go through the portal to book a trip.

This may also mean you won’t get the full $300 value from your credit, as you may not get the best price on the portal and will most likely sacrifice any elite identity allowance you book directly.

Related: Which travel credits are easiest to redeem?

Calculate the value of other privileges and interests of the card

While declaring points is the easiest way to determine if an annual fee for a card is worth paying, they are far from the only benefit you get with a card. Many cards (especially co-brands) carry other privileges to provide value, although the exact value will vary by the person who uses them.

For example, a common branded airline card with free check bags can provide hundreds of dollars worth each year to those who regularly check bags. But if you’re carrying it with you on a team, this revitalization may be worthless to you.

Again, priority access to the lounge can be very valuable – but if you already have access via another card. For example, priority access through Select Access is a benefit that can help demonstrate the high $650 annual fee for the Marriott Bonvoy Brinlig® American Express® card (see Rates and Fees). Registration is required.

However, if you already have access through Chase Sapphire Reserve, that benefit won’t add value if you decide to get Bonvoy Brilliant. In this case, you need to make sure that the other benefits of brilliant will be valuable enough to make it worth paying.

Will benefits actually make your life easier?

If you have to work hard to achieve it, then the benefits are not valuable.

For example, you might be excited about Amex Platinum getting Centurion Lounge Access, but if you haven’t flew over an airport that has Centurion Lounge regularly, you might find yourself trying to plan your trip specifically for a stopover in the airport, where you can take advantage of this access.

If you are not careful, you may spend more time and money on taking advantage of the card. Make sure your card benefits work for you and vice versa.

Will you pay these benefits from your pocket without a card?

This question is an easy way to determine how the card serves you. I can praise Global Entry and TSA Precheck all day and are one of many TPG employees who are happy to pay for this even if I don’t get this access fee through my credit card.

However, I don’t have the same thing for clear membership. I’ve never seen a clear line much faster than my TSA Precheck series, so I don’t need to fork over $199 per year for the occasional savings. So a clear credit is not a card that saves me money.

However, it is easy for people who do want to add a membership to clearly demonstrate that the annual fee of American Express® green cards is $150, as the benefits of one of the cards are the full honor of that membership.

Information on American Express green card has been collected independently by Points Guy. The card details on this page have not been reviewed or provided by the card issuer.

Related: 7 Free or Discounted TSA Precheck, Global Entries and Clear Ways

View the card for travel and shopping protection

If you have a card with solid travel protection, you know what it’s worth when your luggage fails to reach its destination or finds yourself stranded by a canceled flight. Instead of shelling your own hotel room or waiting for airlines to pay, your credit card can provide hundreds of dollars in reimbursement in these sticky situations.

For example, if your luggage is delayed, you will be happy to put a Chase SapphirePreferred® card in your wallet (see Rates and Fees). Chase will reimburse you (up to $100 a day, up to five days, when your luggage is delayed by more than 6 hours) so you need to buy items on your trip, such as toiletries and clothes, while you wait for your luggage to arrive. Even if you only use the benefits value for one day, you can make up for the $95 annual fee from Sapphire Preferred.

Similarly, if you go bankrupt by just a large-scale purchase within a year or two, you know the differences between the card’s purchase protection and the extended warranty can offer.

While these are not always the first benefit we need to consider when evaluating annual fees for a credit card, they are worth keeping in mind. Before canceling or downgrading a card with substantial protection, take a moment to think that if something goes wrong and is not protected by a credit card, you will pay.

Related: What is covered by your credit card’s travel protection and nothing

Request to retain the offer

If you are considering canceling or downgrading your credit card, please request to retain the offer before you decide. Sometimes, issuers will provide the opportunity to earn bonuses or miles through spending as your motivation to keep the card for one year.

For example, TPG contribution editor Matt Moffitt published an annual fee of $695 to his Amex Platinum (see Fees and Fees). He always offers retention offers using the AMEX chat feature on his online account.

According to TPG’s June 2025 valuation, he would typically spend $3,000 in three months, worth $200 to $400 in three months, thus providing 10,000 to 20,000 bonus points. Essentially, this reduces his annual fee to $295 to $495, which is much more delicious.

Related: The Final Guide to Credit Card Retention Offers

Bottom line

At TPG, we believe that many annual credit card fees are usually worth paying. Still, we know that these fees can add up, and it is important to think carefully about whether the annual fee is worth paying, which is when you consider buying a new card and consider reducing one you already have.

To help you decide, check out the entire card portfolio and evaluate the credit and other benefits of the card that add to your life. If not much, you know you can downgrade or skip applying for the card. If the card adds significant value, you will be confident that you will pay for it every year.

Related: Considering canceling your credit card? That’s why you might want to “downgrade” it

For Amex Platinum rates and fees, click here.
For Amex Gold rates and fees, click here.
For Amex Bonvoy Brilliant rates and fees, click here.