[quote=bearishgurl][quote=four walling]I tried to cancel my Discover card a couple of weeks ago because I never use it. I was willing to take the hit on my FICO due to a smaller amount of revolving credit availability if I got rid of it.
Discover threw 3 people at me to try to convince me to keep it open. I agreed to do so just in the interest of saving time-it is a lot of work trying to close a credit card account.
I rewarded their effort by spending $37 with it.
The lesson learned is that no credit card company will ever make people pay to use their card even if they pay off the balance monthly and espcially if they have a client with a superior credit history.
That is important to keep in mind if somebody wants to charge you for the priveledge of carrying their card.[/quote]
I disagree on the Rewards cards, four walling. When you can transfer purchase points to air mileage, car rentals, hotels and just about anything else, including your kid who needs enough points for a flight, these services can be VERY valuable, IMO. Many give two free RT plane tickets just for signing up and using the card once. You also get preferential seating at concerts and events when using the card to purchase tickets.
These cards are typically marketed only to people with very good and excellent credit. With AMEX, outstanding balances have to be paid in full until you are a “seasoned cardholder” at which time you can get deferral privileges on large purchases and travel expenses.
Rewards programs (including “cash-back” for points) are a great way to get more bang for your buck and are WORTH a nominal $150 to $175 per yr. There are too many services offered and available to the cardholder for this fee to be eliminated.
Fees above that only make sense for a VERY frequent traveler and/or high-level outside salesperson. The rest of humanity has no need for the type of perks that these high annual-fee cards offer, IMO.
I use a Rewards card to pay most monthly bills, pay it off every month and . . . well, use the rewards! Got a free hotel night coming right now (up to $108). I’ve used (or given away) five free round trip plane tickets in the last year and several cash rebates of $25 each from another rewards card (which has NO annual fee).[/quote]
A couple of points to make here.
* Amex has changed from it’s old “pay in full” model – it’s a pretty standard revolving credit card now. Even newly issued cards have ‘minimum payments’ etc… This changed about a decade ago.
* If you get your Amex through Costco – they waive the annual fee. And give cash back. No point conversion – just a check in the mail once a year. It’s one of the best deals ever since cash can be used for anything – not just travel. You can use it to pay your mortgage or rent if you want. The only hassle is the cash back has to be cashed in at Costco… But that’s not an issue for me since I go there regularly anyway.
