I use two main cards right now for almost all spending and they both have annual fees - Scotiabank Momentum Visa Infinite ($99) and the Capital One Aspire Travel World Mastercard ($120). When I got these cards I considered the annual fees and still decided having them would pay off.
The Scotiabank card pays 4% cash back on gas and grocery purchases, and you’d need to spend over $200 per month on gas and groceries alone for the card to be worth it. I easily meet this threshold and last year I earned about $500 with this one card.
The Capital One card has an annual fee of $120 but when I applied for it also came with an annual bonus (no longer available) of 10,000 reward miles worth $100 - that means the annual fee is essentially $20. Not bad for a card that pays 2% back on all spending with no category restrictions.
Annual fees need to be taken into account when determining which card is right for you, but there is also the possibility of having your annual fee waived or refunded.
How To Get Your Annual Fee Refunded
We’ve all read about companies giving a small credit or rewards bonus for minor issues like a billing error or bad customer experience - but is it possible to wipe out the annual fee? I didn’t know for sure, but I wanted to find out!
Turns out both credit card companies were willing to negotiate on the annual fee which I was impressed by. I managed to get about $200 in bill credits simply by discussing the annual fee with the company and mentioning that I was willing to switch to another card (which I was) if there were better deals elsewhere. I didn’t get the fees waived completely but came quite close.
Use My Transcript For Yourself
Here is how the conversation went – anyone can use this as a guide on exactly what to say to increase the chances you’ll get your fee waived too:
Customer Service Agent (CSA): Hello, how can I help you today?
Me: Hello. I would like to cancel my credit card.
CSA: Sorry to hear that. Can I ask why you want to cancel your card?
Me: Yes – the annual fee. I find it to be too expensive.
CSA: I can understand where you’re coming from. You do realize you are earning rewards with your card, right? And your rewards are higher than the annual fee so you’re actually ahead every year.
Me: I realize this, but I also noticed there are other cards out there with great incentives for new customers. There aren’t any incentives for this card.
CSA: I see. Do you have any other products with our bank? I’ve noticed you’ve had the card for two years, would you be interested in another card?
Me: I’m not interested in another card. I like my current card but the annual fee is too high. I’ve always paid my bills on time, I have a high credit rating, and as a customer of over two years I would like to have the fee waived. If not I would like to cancel the card.
CSA: Okay. Let me see if there is something we can do about that. Please hold while I speak with my supervisor.
At this point I was put on hold for a few minutes while the agent discussed my file with her supervisor. If this happens to you – it’s a good sign. It means the issue has been escalated and they are considering whether they can waive to annual fee or offer a credit to your bill to keep you as a customer.
CSA: Sorry for the wait, I spoke with my supervisor who told me we are able to give you a one-time credit of $90. We value your business and don’t want to lose you as a customer.
Me: That sounds good. Thank you. I will keep the card.
CSA: Excellent. The credit should appear on your next statement within 3-5 business days. Thank you for calling.
Tips For Negotiating Your Annual Fee Refund
Here are some basic tips anyone can follow when attempting to have their annual credit card fee refunded:
- Mention how valuable a customer you are. Whether you’ve had the card for years and always paid your balance on time, or you pay interest monthly (which is easy income for them) – let the customer service rep know how valuable you are as a customer. If you already have other products with the bank, this makes you even more valuable and you should mention this. Banks are more willing to waive annual fees for customers that already have other products they offer such as mortgages, insurance or investments.
- Be polite, but call with a purpose. You should be willing to cancel the card if you aren’t able to get a credit for the annual fee. The easiest way to do this is to be polite at all times no matter how long you’re placed on hold. It can be frustrating but it can also be worth your while if you can get your annual fee waived.
- It never hurts to ask. So, don’t be afraid to ask for what you really want or counter their initial offer with something better. The worst they can say is no, and the best outcome is you get more money in your pocket.
- Don’t be afraid to escalate the call. If the front-line customer service rep isn’t able to answer your questions or isn’t willing to discuss waiving an annual fee, escalate the call to a level above so that you can get the answers that you need. In some cases customer service reps don’t have the authority to refund an annual fee so you’d need to speak to a supervisor.
- Use competitor new customer incentives. Existing customers almost never get the best offers. So, you need to do your research and use those new customer offers to your advantage. Do a quick google search to find sign up incentives for other cards in the same category (such as travel rewards or cash back). You can then mention this when calling to have your annual fee waived. As a longstanding customer, you should be given an incentive to keep the card you have because other companies are offering you plenty of incentives to switch.
Top Credit Cards With Annual Fees
If your credit card spending is more than $1,000 per month, then choosing a credit card with an annual fee starts to make sense. At that point you will usually end up with the same or more rewards as a no fee card and get better insurance coverage and perks included.
Consider cards listed here if you want the best of the best:
Your Negotiation Story
Have you ever tried to get an annual fee refund or reward bonus on your credit card before?
If so, which card was it and how did it go?