Negotiate your annual credit card fee

Negotiating your annual credit card fee may be an option! It doesn’t cost anything to ask and it can pay off. In practice, how is this done? Here are our tips.

What to do when the first year of your credit card expires?

There are many welcome offers with the first year free. But then comes the time for renewal: the first year ends and the membership fee will be charged.

Many people feel that in order to keep the benefits of their card, they have no choice but to pay their fees in order to remain a good customer of the bank. But is this always the case?

Annual contributions: what should be negotiated?

Everything (or almost everything) is negotiated nowadays. It is the same for the payment of invoices for a service. Electricity, Telephone, Internet, car insurance.

The market offers change, evolve. The renewal of a contract provides an opportunity to discuss it with suppliers in order to obtain a discount, compensation if the service has been little used or even to leave for another supplier offering more advantageous services.

The ideal is to keep up to date with the market in order to know the current arguments. For example, the airport lounge you were entitled to with the credit card was closed for most of the year?

Like any business, the supplier is looking to keep your loyalty. He has room to maneuver to persuade those who would like to jump ship… Retention measures, shall we say.

Let’s take the case of Mathieu C. concerning his contribution

This is a question that was recently asked in the milesopedia Facebook group by Mathieu C.

To which we replied: Call!

Only 11% of credit card holders call to negotiate their annual fee. But of these 51% receive a full reduction in these fees and 31% a partial reduction.

And here is the testimony of our reader after our advice

What are the factors that contribute to a reduction in the annual fee on his or her membership?

We are not financial analysts but some factors are obvious: if you use your card a lot (and pay for it!), then you are a good customer so they will be more inclined to make a commercial gesture in your favor.

It also depends on the amount of the fee, which represents substantial revenue for the financial institution. Finally, mentioning a possible closure of the card can also trigger a retention process with an offer at the end. But this is only a last resort if closing is really an option for you.

What can you get?

You can be granted during this negotiation:

In the latter case, before giving an answer, do a quick calculation if it is worth it. When renewing an Aeroplan card for example, use our calculator.

One Aeroplan point is worth 1.7 cents, so if you are offered 5,000 points that’s a discount of about $85. In the case of the Scotiabank American Express card, the rate is 1 point = 0.01 cent, so the 10,000 points often offered by Scotiabank entitle you to a $100 fee reduction.

What if you don’t get your way?

Our best advice: if your arguments hold up, hang up and call back! Every representative is different and you may find someone more accommodating. Don’t waste your time being stubborn with the person, you have the right to ask for a second opinion.

Finally, remember “ Nothing ventured, nothing gained! “Dare!