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THE UlTiMATE gUidE TO FREqUENT FlyER MilEs

Cards that earn points with a company are a great choice because instead of earning miles or points
with only one airline or only one hotel chain, you are earning points that can be used with any partner
of that card. This gives you great flexibility (always a great thing when making travel plans), as partners
typically include 2-4 airlines, a few hotel chains, and even others, like rental car companies.

Annual Fee

Most of these cards will have an annual fee attached to them. These can range from $50-$450. How-
ever, many companies will waive the annual fee for the first year, meaning that you can earn the miles
by making the minimum spend and then canceling them 11 months later, before you get hit with the
annual fee. This will not affect the miles you earned as a sign up bonus. Once you earn the miles, they
are yours.

So what if you do not want to cancel the card but you also don’t want to pay the annual fee? There are
two little tricks that you can try:

1. Try to get a retention bonus. Credit card companies don’t want to lose customers and
sometimes they will offer you an incentive to stay. Call the company and simply tell them you
are thinking about canceling the card because you don’t want to pay the annual fee and
they don’t offer any type of anniversary bonus. They just may offer you miles or a statement
credit to stay!

2. Downgrade the card. A lot of the cards will have a lesser, more basic version of the card.
Usually, this card will have a lower signup bonus, but since you’ve already gotten the better
one, you don’t care about that. The key is that this lower card will often have no annual fee.
Instead of simply canceling, ask if you can downgrade to a lower version of the card with
no annual fee. This way, you get to keep the credit line open and won’t pay anything, year
after year.

My rule of thumb is that I’ll keep a card for two reasons;

1. If it is one of my daily users

2. If it offers an anniversary bonus, such as 10,000 miles or a free night stay, that it offsets the
annual fee.

Foreign Exchange Fees

Unless they specifically mention it that they charge no foreign transaction fees, most cards will charge
3% when you use your card abroad. If you live abroad or are planning on traveling even a decent
amount, it is always good to have one of these cards in your arsenal.

The three most popular cards that have no foreign exchange fees are the Chase Sapphire Preferred
(my personal favorite), any Capital 1 card, or the American Express Platinum (although this comes with
a hefty $450 annual fee). It should be noted that in recent months, many cards are jumping on the “no
foreign transaction fee” bandwagon, a welcome sign for us!

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