When it comes to paying huge annual fees on credit cards, I always tend to err on conservative side as far as perks/coupons are concerned. Priority Pass can be useful, but only if you actually fly. Monthly Uber (and Uber Eats) credit is relatively easy to use, but the company may stop serving my area at any point.
I’m not a pessimist in real life, but with credit cards I tend to look at the worst-case scenario and plan accordingly. I’m probably an anomaly in this hobby, but there have been long periods of time when I didn’t have any cards with Priority Pass benefit. In fact, I was too stingy to even pay $95 renewal fee on Chase Sapphire Preferred. And you know what? I didn’t usually miss anything.
So, it’s more than a little ironic that my husband and I currently have five ultra-premium credit cards in our possession. And yes, we did pay the annual fees that come with them. I’m a freak who drives an old van with 225k miles on it, but pull out a shiny Amex Platinum at the drive-thru.
In our household, I’m the one who handles finances, and am not really obligated to notify my husband of any large purchases I make. Of course, I do it anyway as a courtesy. My husband normally doesn’t react, but lately he started raising his eyebrow after I told him about yet another “investment”, AKA $695 annual fee. In fact, I think his eyebrow is permanently raised now.
In the last eight months, we got US Bank Altitude Reserve ($400 fee), Amex Platinum X 2 ($1,390 in annual fees), Amex Hilton Aspire ($550 fee) and Chase Sapphire Reserve ($550 fee locked under old rules). Some fees haven’t hit yet, but will soon enough. As you’ve probably guessed, the main reason I got these cards is the signup bonuses. I received tons of various credits, several award hotel nights, $750 off travel purchase and should get 325k Amex MR points when all is said and done.
The perks are nice and all, but they rarely sway me at the time of renewal. The only exception is Chase Sapphire Reserve which I’ve recently upgraded to without any bonus. I had 125k Ultimate Rewards points and wanted to use them towards a cruise at 1.5 cents apiece. I also may utilize the $250 Edit hotel credit, plus StubHub and restaurant perks since we are planning to be in Las Vegas at the end of the year anyway.
But like I said, the main reason was the ability to get 1.5 cents towards cruises. I should also be able to utilize $300 travel credit twice before downgrading. And yes, I will absolutely be downgrading before the next fee hits. BTW, the current offer is worth considering, at least in my opinion. Read Nancy’s post here
My referral link for CSR or CSP
Nancy’s referral link for CSR or CSP
All the other cards will also be axed except Amex Hilton Aspire, which I will get to in a moment. In all likelihood, we won’t have Priority Pass access after next August, though I plan to cut back on flying at that point anyway. But who knows, maybe something else will turn up that will have this perk on top of signup bonus. I’m an optimist and always assume things will somehow work out. And they usually do.
Why I will likely hang on to Amex Hilton Aspire card
My new annual fee will hit next January. While $550 is a lot of money, we should get much more than that in value. And not the inflated kind (20 CPP!), but real value that aligns with our pre-existing travel plans. You see, we are hoping to take my daughter to Japan next year and I’ve already booked most of the award flights.
We will need to stay in Osaka for just one night, and I should be able to use free hotel certificate from renewal at either Conrad Osaka or Waldorf Astoria Osaka. Due to Diamond status, we would get lounge access and a magnificent spread at breakfast. It’s not worth $550, but I would probably pay $300 for something like that. On top of this, we also have existing plans to stay at a local Hilton resort where I would be able to use $200 credit from Aspire card. Even though the prices are always inflated, it’s so much easier to dine on-property. And yes, there is also $50 quarterly credit towards flights, but it’s not something I value highly.
But wait, the combined total is still less than $550 fee. True, but I plan to downgrade Aspire card to no-fee Hilton product five months after the fee hits. Under current unofficial rules, I should get over half of it back. No guarantee, of course, but to me, our travel plans make paying the fee worthwhile regardless. At the very least, we should be close to breaking even, while staying in a fancy hotel ($1k per night) I would not splurge on otherwise.
I should mention that my daughter wants to stay in a nearby capsule hotel, so it will likely be just me and my husband. But if she changes her mind, we can use a certificate on a standard room at Conrad Osaka and pay a fee to add a rollaway. I’m not sure how all of this will work out in practice, but hopefully we will end up paying $275 for a $200 resort credit plus a free night at Conrad where most of our food will be included. That’s a deal I can live with.
Final thoughts
While I’m getting a lot of value out of my “investments”, that’s still a small fortune in annual fees, wouldn’t you agree? I never cared about the term “free travel”, though don’t go out of my way to correct others. It’s often a matter of semantics anyway. To me, travel is something I value highly, and am willing to spend money on. I’m also very much aware that most of these points can be redeemed towards gift cards, so they have inherent value that I give up by using them towards trips. It’s still an investment, but in future memories.
For now I’m OK with the tradeoff, but at some point tough choices may have to be made. For example, in the next few years we need to replace flooring in our house. Would redeeming 100k Amex MR points on $1k Home Depot gift card make more sense? I’m not quite there yet, but you may decide that it’s the best option for your family. Don’t feel guilty if you have to give up your “free” travel. It was never free anyway.
See related post How much does your “free” vacation cost you per hour?
Author: Leana
Leana is the founder of Miles For Family. She enjoys beach vacations and visiting her family in Europe. Originally from Belarus, Leana resides in central Florida with her husband and two children.
@Aleks You’ve just reminded me that I need to try to convert my Altitude Reserve card to Altitude Connect, so I can have those 4 Priority Pass entries. I totally forgot about this product, and was planning to cancel. Thanks!!
In fact, if it works, I’ll try to convince my husband to also convert his US Bank Cash+ because we are not really using it that much anyway. Having 8 passes per year should be sufficient for my family, and you can’t beat the fact that it’s a no-fee card. Paying annual fee while getting a juicy bonus is usually worth it. But there is no way I’m dropping $700 just to clip virtual coupons.
All valid points Leana. Also doing card “weeding” every other year to eliminate excess fees. Used to carry Aspire card while the fee was $0-$95/yr with some nice value from it, but bulged once Amex increased it to $550.
Most other “premium” card don’t appeal much as the fees jumped sky-high while benefits squeezed into monthly/quarterly coupons – I rarely use Uber, food delivery and United credits, so most of those are nonsense to me. Preferred card is the one I keep for few good benefits and relatively low annual cost of $45. We have 4 lounge passes per year thru no-AF card and it’s enough, as some business-class/premium econ tickets will get you lounge access as well.
You might watch out for increased value (2cpp) on Reserve as Chase said to have some cruises bumped for the promo. While the “free cruises” gravy-train is gone now, it was fun to use. I was also eyeing Virgin Voyages via Delta miles, but holding off new sailing for couple of years. Hope you’ll find some good options for Alaska.
Happy travels!!