Credit cards offer incredible perks that can improve your travel experiences. And the ability to earn miles, points, and cash back on your everyday purchases makes this form of payment hard to beat.
But what happens when credit cards start reducing or eliminating benefits? You’ll need to re-evaluate whether to keep the card because an annual fee that made sense before may not be worth paying when the bill comes due again.
Banks Are Reducing And Eliminating Benefits
Consumers are learning to sign up for credit cards for their lucrative sign-up bonuses. However, experts know that there are even more powerful perks that cardholders can use every year. These benefits make paying the annual fee worth it, even when those fees top out at $550 per year.
But now that credit cards are starting to cut or eliminate these benefits, does it make sense to keep the card any longer? It depends.
Here are five examples of incredible perks that are being reduced or eliminated on some of the travel industry’s favorite credit cards.
American Express Centurion Lounge Access
The Centurion Lounges are some of the best domestic airport lounges around. Travelers can access these lounges if they hold the Platinum Card from American Express, the Platinum Business Card from American Express Open, or the American Express Centurion Card. Once inside, you’ll be treated to delicious food, comfortable seating, and premium drinks. Some of these lounges even offer complimentary showers, massages, and manicures!
Effective March 2019, the benefits were reduced in a meaningful way. Access to the Centurion lounges was limited to departure flights only and you can only enter a maximum of three hours before your departure time. This means that you can no longer visit a Centurion lounge at your final destination to freshen up or grab something to eat or drink.
Additionally, the number of guests that you could bring into the lounge was reduced to two guests per cardholder (which is frustrating for families of four, like mine). In order for all four us to enter, I would need to pay $175 per year to add my wife as an authorized user.
Unfortunately, if you want to access the Centurion Lounges, you’ll need to keep your Platinum Card from American Express. If any airline lounge works for you, then look at a card like the Chase Sapphire Reserve. Not only is the annual fee lower and the $300 travel credit more flexible, but you also receive a complimentary Priority Pass Select airport lounge membership.
Chase Price And Return Protection
A lot of cardholders do not take advantage of price or return protection, but these benefits can be a real money-saver. Unfortunately, Chase began eliminating these benefits in August 2018.
Price protection gives cardholders a way to receive a refund of the price difference if they find the same item at a lower price within a short period of time. I love this benefit because I can buy the item I need when I want it, then submit a claim if the price drops, even if the lower price is at another store.
Return protection guards against a merchant not accepting your return. Some stores have restrictive return policies or just don’t have good customer service. When this happens to a covered category of purchases, return protection will refund you the money when the store will not.
These shopping benefits can be very valuable when used correctly. Since Chase no longer offers these benefits, consider switching to the American Express Gold Card. Not only will you keep price and return protection, but you’ll earn 4x on dining and groceries, enjoy a $100 annual travel credit, and treat yourself with $120 in annual dining credits.
Citibank Price Rewind
I love shopping on Amazon, and Citi Price Rewind has been my best friend for years. This benefit has saved me thousands of dollars over the years.
Price Rewind is price protection on steroids because you could be reimbursed up to $200 per item for a total of $1,000 per year. Previously, these limits were $500 per item for a maximum of $2,500 each year.
Citi is eliminating Price Rewind and trip cancellation and interruption protection on all of its credit cards. Other important benefits to travelers are being eliminated on many of their cards, including:
- Trip cancellation and interruption protection
- Worldwide travel accident insurance
- Baggage delay and lost baggage protection
- Worldwide car rental coverage
- Travel and emergency assistance
- Trip delay protection
- Damage and theft protection
- Medical evacuation
- Extended warranty
Contact Citibank to determine which benefits of your card are being eliminated effective September 22, 2019.
I really like the Price Rewind feature and am sad to see it go. The closest I’ve seen to replicate this money-saving perk is from the Capital One Venture. Capital One has partnered with Paribus to find potential savings on all of your online purchases.
American Express Priority Pass Removes Restaurants
When you travel, airport lounges are one of life’s affordable luxuries that I believe all travelers should invest in. With airport space at a premium, Priority Pass established relationships with certain restaurants in airports that didn’t have space in a lounge. Priority Pass members can spend up to $28 per person at most participating restaurants.
American Express offers a complimentary Priority Pass membership with many of its premium credit cards. Effective August 2019, Amex discontinued access to Priority Pass restaurants to its cardholders. This places Amex at a competitive disadvantage to other premium credit cards that continue to offer this benefit.
Just because American Express eliminated this benefit, it doesn’t mean that you have to lose out on nice meals at the airport. Several credit cards still offer Priority Pass restaurant credits, including the Chase Sapphire Reserve, Citi Prestige Card, and US Bank Altitude Reserve Visa Infinite.
Citi Prestige Card Limits 4th Night Free
For travelers that pay cash for their rooms instead of points, the Citi Prestige Card 4th night free benefit offered up to 25% off their hotel stays. When you book through the Citi Prestige Card concierge or travel portal, you will receive the 4th night free on an unlimited number of hotel stays each year.
Effective September 2019, cardholders are now limited to two 4th night free reservations each calendar year. For the frequent traveler, that is a major blow to your travel budget. And when you add in the elimination of unlimited Admirals Club access and three free rounds of golf each year that were removed a couple of years ago, it is hard to justify paying $495 each year for this card.
For occasional travelers, the savings from using the 4th-night free option twice a year may be enough of a reason to keep the Citi Prestige card. Unfortunately, no other credit cards offer the same benefit. However, Marriott Bonoy and Hilton Honors provide the 5th-night free on award reservations. Chase IHG Rewards Club cardholders get the 4th-night free when booking with points.
If you must book a room with cash, look into the Luxury Hotel Collection for Visa Signature cardholders, like the Chase Sapphire Reserve. Booking on that site provides exclusive benefits, including complimentary upgrades and daily breakfast, and some hotels offer 4th-night free promotions.
What Are Your Options When Benefits Are Eliminated?
People in the miles and points world are used to regular changes. Unfortunately, changes like this are not uncommon, so we have to simply tweak our strategy each time they happen.
Ask For A Retention Bonus
Banks spend a lot of money to get someone to apply for a credit card. They want your business and don’t want you to leave. This is especially true if you spend a lot of money on the credit card or have many products with them. For example, you may also have a mortgage, bank account, or investments that make you a customer they don’t want to lose.
Instead of canceling the card, call customer service and tell them that you are considering closing your account. Explain that the negative changes to benefits are the reason why you are unhappy. They will transfer you to the retention department so you can speak with an agent who is authorized to make offers that may make it worthwhile for you to keep the card.
Examples may include waiving the annual fee, bonus points, or a “spend challenge.” Spend challenges offer extra perks when you meet certain spending hurdles.
Downgrade The Credit Card
If you like the bank, you can continue to do business with them by downgrading your credit card. In most cases, you’ll keep the same credit card number and account history while reducing or eliminating the annual fee.
Transfer Credit Line And Close The Account
If you decide to close the credit card and have other credit cards with the bank, transfer your credit limit to one of the remaining cards before you close this account. Keeping that credit limit benefits your credit score by helping to lower credit utilization.
Most banks will allow you to do this between personal accounts. However, a transfer of credit limits between personal and business credit cards is not as easy.
Apply For A Better Credit Card
Closing a credit card can be a frustrating experience. You enjoyed the perks of the card. And the credit limit was great for big purchases or simply to keep your credit utilization low.
Whenever I close a credit card, it is as an opportunity to shop around and find a better credit card. Although banks are reducing benefits on some cards, they are introducing new credit cards all of the time. Different perks on these new cards are being tested on a regular basis because the market is so competitive. Use this opportunity to be a “free agent” and explore what each bank offers. You may end up with a credit card that meets your needs even better than your previous one.
The Bottom Line
I view annual fees as the paychecks that each one of my credit cards earns each year. When the annual fee comes due, I do a “performance evaluation” to see whether or not that credit card has earned its paycheck. Then I decide whether or not they’ll continue to work for me in the future.
With banks changing the benefits and raising annual fees on so many credit cards, a card that worked perfectly for you in the past may no longer be the right one going forward. I encourage you to review your wallet and see which of your credit cards are no longer pulling their weight.
When it is time to cancel a card, call the bank and see what retention bonus they will offer you. If the offer isn’t good enough, downgrade or cancel the credit card. Then shop around to find one with a sign-up bonus and benefits that fits your needs.
Have any of your credit card benefits changed recently? What did you do about it? Share your story in the comments below.
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If you really want to maximize your travel rewards check out ChooseFI’s free travel rewards course.