Now, I’ve written plenty of credit cards annual fees, and first year waived annual fees alike. It goes without saying that each credit card issuer varies when it constitutes upcoming fees and just when you need to cancel in order to avoid the annual fee for the next year. Here are some things you should take initiative on prior to canceling your card, whether it be to avoid paying the annual fee next year, or to get a prorated refund or even a retention bonus of some sort!
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Before you call in for whatever reason, be sure to:
- Reach the retention line to see if they’ll offer you anything along the lines of waived annual fee or bonus
- Pay off any excess balance in full
- Transfer any points/miles before closing your account, if necessary
- Call before the statement closes
- If an Annual Membership fee applies, they will refund this fee if you notify us that you are voluntarily closing your Account within 30 days of the Closing Date of the billing statement on which that fee appears. For cancellations after this 30 day period, the Annual Membership fee is non-refundable. If an Annual Membership fee applies to your Account, it is shown on page 1 and page 2 of Part 1 of the Cardmember Agreement.
- AMEX will still pro-rate annual fees for upgrades or downgrades, just not cancellations.
American Express Best Downgrade Options:
- AmEx EveryDay: This is a well-balanced, rounded credit card that offers no annual fee and allows you to earn American Express MR points, meaning if you downgrade to this card, you’ll still have the option to transfer your points to airlines and hotel providers. You will earn points based on 2x points at US supermarkets, on up to $6,000 per year in purchases (then 1x); 1x points on other purchases.
- Blue Cash Everyday: This card has no annual fee and Earned Cash Back: 3% at U.S. supermarkets on up to $6,000 per year in purchases, 2% at U.S. gas stations & select U.S. dept stores, 1% on other purchases.
- Gold Delta SkyMiles® Credit Card to Blue Delta SkyMiles® Credit Card – 27 days after annual fee posted
- Platinum Delta SkyMiles® to Blue Delta SkyMiles® Credit Card – 7 days after annual fee posted
Editor’s Note: You cannot downgrade a charge card to a credit card. Your best option could be downgrading rather than cancelling considering you may be at risk of losing all of your Membership Rewards points if you do so.
Bank of America
- Bank of America typically refunds you on your annual fee based on your banking history with them. If you’ve made all your payments on time with them, then it’s safe to say that you could receive a refunded annual fee IF you’re cancelling within one statement period.
- Barclaycard typically refunds your annual fee so as long as you cancelled your card within 60 days of it posting to your account.
- Before closing, if you have a Barclaycard Arrival Plus® World Elite Mastercard® or Barclaycard JetBlue Plus Mastercard®, downgrading to their no annual fee variant cards could be a lot easier on you than closing.
- So as long as your payment history is on point, Capital One will offer to waive your annual fee on their credit cards. Here’s how it works: After your annual fee has posted, you’d have a 30 day’s statement credit window to call and ably get the annual fee refunded. It may take a try or two.
- There’s been plenty of cases where Capital One Venture cardholders downgraded and received an annual fee refund, so as long as you’re within the 30 day’s period after annual fee posting.
- You will now have a 30 days period after your annual fee is billed/posted to cancel and receive a refund. This would include not only Chase’s personal selection of cards but their business card portfolio as well.
JP Morgan Chase Best Downgrade Options:
- Chase Freedom Unlimited®: The card is basically your fat 1.5% everywhere at no annual fee and allows you to earn Ultimate Rewards Points, so if you downgrade to this card, you’ll still have the option to transfer your points. Note that Chase Sapphire Card Customers Limitations allows you to only have one Sapphire product in possession per 24 months. If you have a Chase Sapphire Preferred® Card or Chase Sapphire Reserve Card, downgrading to a freedom product may be a viable option.
- If you have an annual fee United Card, downgrading to the no annual fee Chase UnitedSMTravelBank Card that just dropped may also be an option. Note that downgrading would result in no bonuses.
- Citi may refund the annual fee and all it’s entirety if you cancel your card within 30 days of it posting. After 30 days, they would offer a prorated refund based primarily on the month the annual fee posted in, so if you have a Citi ThankYou Prestige with a $450 annual fee and the annual fee post in January and you cancel in March, there’s a good chance that you’d receive a 9 month’s refund.
- U.S. Bank will refund an annual fee if the card is cancelled within 30 days of annual fee posting to the account.
- You will now have a 90 day’s period after your annual fee is posted to cancel and receive a refund.
Various Credit Card issuers have there own policy regarding cancelling and annual fee refunding. Before taking such initiatives, I want to remind you that calling retention could be a viable option. In such a case, you could receive a bonus or a waived annual fee out of it. Also, note that canceling a card could hurt your credit score, so it could be a better option to downgrade to a no annual fee card. Don’t forget to also check out our full list of Credit Card Promotions, for any and all of your credit card necessities!
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