Like many of you, I recently applied for the Citi Executive / AAdvantage World Elite MasterCard, which is still offering 100,000 bonus miles after spending $10,000 in 3 months. However, a few weeks later I got an email notifying me that the annual fee was due on my existing Citi Platinum / AAdvantage Visa Signature.
I have two American Airlines credit cards, and the one I’d just applied for has arguably has better benefits. It’s hard to find a better argument to cancel the old card. While you don’t need a reason to close a credit card, it certainly helps make the process move along and even negotiate for a retention offer to keep the card open. The card company doesn’t like it when you close a card. You shouldn’t like it, either, since it lowers the average age of your accounts. (Open cards keep adding to the average. Closed cards stay young.)
Whenever possible, you should try to get a retention offer rather than close your account. Think of it as a miniature sign-up bonus. Usually there’s a small spending requirement in order to earn a statement credit or extra miles. It makes it much easier for you to hold onto travel rewards cards for their other benefits without paying the fees meant to cover those benefits’ costs.
Citi made me a good offer this time, so I’ll share it in case any of you are in a similar predicament. In exchange for paying my $95 annual fee and keeping the Platinum / AAdvantage card, I’ll get a $95 statement credit within the next two billing cycles. Furthermore, I’ll receive 1,000 bonus miles for each of the next 16 billing cycles when I spend $1,000 or more. That means I can put general expenses that don’t ordinarily qualify for any category bonuses on the Platinum / AAdvantage card and get the same 2 miles per dollar (up to the first $1,000 each billing cycle) that I would get for American Airlines purchases. It helps a lot, and the phone rep acknowledged that otherwise I’d probably have a lot of better options for charging my everyday expenses.
As for crediting back the annual fee? Well, I don’t need to pay $95 for things like a free checked bag that I already get with the $450 annual fee on my Executive / AAdvantage card — or for that matter, my Executive Platinum status. So I’m glad the bank saw reason and made me whole. I was actually surprised they didn’t require any minimum spend in the next few months to earn the statement credit.
But by keeping the card I’ll also continue to get a 10% rebate on miles redeemed, up to 10,000 miles rebated each calendar year. That’s something the Platinum / AAdvantage card offers and its higher-priced sibling leaves out. Altogether I stand to earn up to 22,000 extra miles for no additional cost.
We’ll still have to see what happens at next year’s renewal and whether I keep one or both cards or even close both and apply for another. But for those of you who haven’t tried something like this before, I suggest the next time you find an annual fee on your statement that you ask if the card issuer can do anything to make it worth your while. A quick check on FlyerTalk suggests my experience isn’t atypical.
