Is My Annual Fee Worth It? It Just Might Be, But That Doesn’t Mean You Have To Like It.

Is an annual fee worth it? There was a time when I would have scoffed at all annual fees. Why pay a creditor for the privilege of putting their card in my pocket? What nonsense! Besides, aren’t they charged to people with damaged credit, for whom the amount is a slap on the wrist for being bad? The answer to that is “sometimes”.

It is true that sub-prime cards are available to those who have had problems with getting into debt or delinquent payments, and in those cases the issuers will add on a punitive fee. Typically there are few rewards for use, and instead the money goes toward the creditors own sense of security.

However, the fees on high-end cards are similar to VIP admission charges. So, is an annual fee worth it? If it gives you enough privilege. Sure, you are out some cash, but what you gain in ex-change can be well worth the price. To understand if annual fees are worth it, understand how they work.

Annual fees range dramatically, from less than $50 to $500 and beyond. Always carefully read the rewards program that comes with these fees. You will want to know exactly what you get for the expense, and calculate its worth to you. Do you love airport lounges and make use of them whenever you travel the globe? You know that access (if you can even get in) is around $50 per day. Ten visits per year and you’ll break even for the card that charges the top price – and that’s just for that one service.

The deals you get on car rentals and hotel rooms can also be simply deducted from the price. Save $100 per day on the combination of those two and you’ll make money with the fee in less than a week.