What to do When Annual Fees Post

Many credit cards with annual fees waive the annual fee the first twelve months. Twelve months have passed since I got my first credit cards with an annual fees (AFs) so my twelve months of waived annual fees have ended. This means I have to decide what to do with these cards.

My three options are:

  1. Cancel the card and not pay the annual fee;
  2. Keep the card and pay the annual fee; or
  3. Keep the card, but product change the card to a no-AF version

Keeping a budget for the entire year has meant I budgeted enough money each month to be able to pay any annual fees (AF) once it came time to pay up. However, a year of use has helped me learn more about my spending habits, and how much I value each of the cards I have acquired.

So what am I doing with these cards?

The biggest reason I’m okay with signing up for credit cards is knowing I am building credit history, so I prioritize options 2 and 3 from above.

Now, I could cancel all of my cards and the accounts would continue to increase my Age of Credit History for 10 years until they fall off my credit report (10 years from now), but I’d rather keep them forever and have 30+ year old accounts. Plus, keeping as many accounts open helps me build a relationship with banks.

Product Changing

I wrote about flying to Hawaii using points from the United MileagePlus Explorer card and flying to the east coast to visit family using American Airlines miles from the Citi AAdvantage Platinum card last year. And I decided to product change these two cards instead of canceling or paying the AFs.

By product changing (PCing) these cards within 30 days of the AF posting, the $95 annual fees were refunded to my accounts. If the cards did not have fee-free versions, I would have canceled the cards and still been refunded the annual fees.


Another card mentioned in the post about flying to Hawaii was the American Express Premier Rewards Gold card. I am still unsure of what to do with this card because it offers good category bonuses, but I’m not sure if I would benefit from earning Membership Reward points since I don’t spend enough to accumulate enough for a full trip. Fortunately, I have a couple more months to decide whether I will cancel the card or pay the AF.

A third card I used during my Hawaii trip was the Barclaycard ArrivalPlus. This card allowed me to redeem points to zero out the cost of the GoCity Card I bought to hit all the tourist attractions. These points are very flexible, but the ArrivalPlus requires a minimum of 10,000 points ($100) to redeem against a travel expense. I could have changed the card to the no-AF version, but I had too much trouble with the card so I ended up canceling it.

Keeping and Paying the Annual Fee

At the other end of the spectrum, I am planning to keep the Hyatt and IHG credit cards from Chase and pay the annual fees because I get a free 1-night stay from each card every anniversary. The Hyatt certificate restricts use to category 1-4 hotels. However, the IHG annual certificate has no restrictions on hotel categories, so I could spend the night in Times Square for the $49 annual fee on the card.

Advantages of the Barclaycard Arrival Plus Credit Card

The Arrival Plus from Barclaycard is a travel rewards card with an $89 annual fee (waived the first year), 2 points/$ on all purchases, but most important has Chip + PIN functionality (for use outside the USA).

Barclaycard Arrival Plus

I signed up for this card with a waived first year annual fee and 40,000 points after spending $3,000. While I have not used the Chip + PIN functionality of this card yet, I have utilized the travel rewards and intended to let my parents use the card during their trip to Europe last month.

Free Dinner in Hawaii

Polynesian Culture Center, where I enjoyed the luau and dinner show

Leading up to my trip to Hawaii in June I knew a few things I wanted to do: I wanted to snorkel in Hanauma Bay, to rent a bike so I could train for the Santa Cruz Tri and get around, and to attend a luau. Through my searches I found the Go City Card.

The Go Oahu Card allows for travelers to either select their own attractions and rentals (like individual ships at the Pearl Harbor museum or the Pearl Harbor-City Tour) or buy an all-in-one pass. The 3-, 5-, and 7-day all inclusive passes offer 1 premium attraction, so I picked the Alii Luau & Dinner show to go along with the Polynesian Culture Center entry because I purchased a 3-day all-inclusive pass.

Using the points earned from the 40,000 point sign-up bonus for the Arrival Plus card I paid off the $185 3-day pass. The Alii Luau & Dinner show alone was $113 making it easy to recoup the full price of the all-inclusive pass with visiting only a few more attractions. I stayed on Oahu for 5 days and the 3-day all-inclusive pass was perfect for my needs as a solo traveler.

Saving for a Triathlon

Ocean Pacific Lodge

I raced in the Santa Cruz Tri and book a stay at the Ocean Pacific Lodge (review soon to come) for ~$300. This was a perfect price because after my sign-up bonus and spending then redeeming points on my Hawaii trip I had just enough points for a 1 night stay. It was not until I visited Santa Cruz a few weeks before the race that I was able to see that the hotel was not only a block away from the beach start but it was also directly across the street from the transition area. The proximity of the hotel to the start and transition area were easily enough to make this hotel and points redemption a great value.

Putting the Chip and PIN to Use in Europe

My intentions were to give my parents Authorized User cards for my Arrival Plus for when they needed Chip + PIN (not Chip + Signature) functionality on their Europe trip, but the cards did not arrive in time. I guess I will have to try this card at Target to see if the Chip + PIN is triggered.fd