High credit card annual fees are typically associated with premium cards that offer exclusive rewards. Premium travel credit cards, in particular, often come with steep annual fees but provide a wide range of valuable perks such as travel credits, airport lounge access, and enhanced rewards. These cards have long been favored by savvy cardholders seeking elite benefits usually unavailable with no annual fee cards.
Cardholders often justify the high yearly fees by leveraging benefits like airport lounge access, considering the annual fee a “drop in the bucket” compared to the cash value of the perks received. Loyalty programs further enhance the appeal of high-end cards by offering ongoing perks, elite status, and incentives that encourage repeated use and foster customer loyalty.
However, recent price increases on some premium cards, including some of the most popular and arguably the best premium credit cards on the market, threaten to erode their value. For instance, the Chase Sapphire Reserve Card and the American Express Platinum card have both seen notable hikes in their annual fees, reflecting a broader industry trend of rising fees among premium travel credit cards.
The bottom line question, given such increases, is are credit cards with annual fees still worth it? When considering a card with an annual fee, it’s important to weigh the benefits against the costs to determine if the perks justify the expense. The short answer is…it depends. Let’s dive deeper to help you decide if such a card suits your needs or if it’s time to reassess the value of your current premium card.
Credit card issuers raise annual fees despite consumer pushback
Chase Sapphire Reserve(R) increases to annual_fees
Chase Sapphire Reserve(R) cardholders received notice earlier this year regarding a price hike. However, the notice didn’t contain all bad news and included the following enhanced benefits:
- Increased earning rates on purchases through Chase Travel℠
- A variety of statement credits for things like DoorDash, Global Entry, TSA PreCheck, and Lyft
- Complimentary Priority Pass airport lounge access for authorized users
To help justify the higher annual fee, the card’s perks are periodically updated or enhanced, providing more value and appealing to high-spending customers.
If you’re an existing cardholder, you may be wondering if the card is still offers a good return on investment (ROI). Megan Daniels, a travel writer and founder of JourneyCurrencies.com, notes that a “card’s value depends a lot on whether you’d already pay for the benefits it offers” and adds, “I love a lot about the Chase Sapphire Reserve including the easy $300 travel credit and lounge access. But the other credits that go to offset that annual fee include things like Lyft, StubHub, Apple Music, and Peloton. I don’t use any of those, so the value doesn’t add up for me. For someone who already pays for those services, though, it can be a no-brainer card that easily pays for itself.”
➤ SEE MORE:Should you downgrade Chase Sapphire Reserve®? Real numbers compared
American Express Platinum Card(R) fee jumps to annual_fees
The popular American Express Platinum Card(R) discontinued_disclaimer also recently saw an annual fee increase. This hike will be effective for renewals on or after Jan. 2, 2026, but is already in effect for new applicants. To offset the increase, Amex announced it is offering several new and enhanced credits for such things as hotel stays, Lululemon, digital entertainment, and dining through Resy. These are annual credits provided upon renewal, designed to help offset the increased annual fee. Amex states that these new benefits can be worth more than $3,500 per year, which is a whopping $2,000 more than their previous claim of $1,500 per year in benefits. (American Express is a CardRatings advertiser. Enrollment may be required for select benefits. See Rates and Fees)
Despite this claim, your individual results will vary. Daniels explains that when she signed up for the card at an earlier price point, she derived considerable value, especially during her first year of card membership. In particular, the welcome bonus she earned covered the fee in and of itself.
However, she noted that the ongoing value was lacking for her beyond the first year, stating, “I expected to use most of the credits, but some ended up being harder to use than I originally thought. So I closed my account soon thereafter. After the revamp [increased fee], I’m thinking about applying for their Business Platinum Card.”
Her takeaway is simple. The lucrative bonus can make the first year easy to justify. What really matters, however, is whether the card still earns its spot in your wallet after that.
Other cards follow with smaller hikes
The card industry is often “monkey see monkey do” when it comes to perks and fees. Not surprisingly, other cards have increased their fees, including cards that are not considered premium and have lower annual fees. Many popular cards have raised their annual fees in recent years, with issuers often using welcome bonuses to attract new cardholders and help offset the initial cost.
Similarly, some well-known cards have increased their fees while promoting new benefits to balance the higher cost. For example, certain cards now offer perks like statement credits for everyday expenses, which can help cardholders get more value from their annual fee.
Issuers justify fee hikes with expanded perks and competition
Travel credits and lounge access as key incentives
Airport lounge access, as referenced above, can be a great asset, particularly for frequent travelers. Daniels sums it up best by stating that “it gives you a place to eat, recharge, and reset during long days in the airport.” Earning elite status through airline or hotel loyalty programs can also provide additional benefits such as upgrades, late checkout, or even enhanced lounge access, making travel even more rewarding.
However, she clarifies that how useful it is really depends on the airports you fly through the most. The bottom line is that if they have good lounges, it’s a great benefit. If not, this perk often goes to waste.
To quantify this benefit, you need to consider the typical access fees for individual airport lounges. For example, annual memberships for lounges like those of American Airlines can cost up to $850, depending on the user’s status and level of access.
While several issuers tout this as a “lifestyle type perk” that is hard to put a price tag on, a few issuers are actually adding restrictions. Jason Steele, a nationally recognized expert on card rewards, opines that “in particular, both Amex and Chase have eliminated your ability to bring guests into the lounge, unless you meet a large annual spending requirement,” possibly diminishing the value of this perk for some cardholders.
His key takeaway is that “these cards still make sense for frequent travelers who have a participating lounge at their home airport, but I no longer consider them a must-have for those who don’t travel at least once a month.”
Travel credits can be similar. Some are easy wins, but others aren’t worth the extra effort. And unused credits obviously translate into no value whatsoever.
Steele cautions that issuers have “added numerous fee credits to justify their annual fee price hikes, but these are often with merchants that you might not be interested in, or they are numerous small, monthly or quarterly credits that are challenging to keep track of.” He adds that “while in the past the fees were justified by numerous valuable benefits and a few fee credits, the benefits in some cases have shrunk, and the fee credits are now more numerous and difficult to use. Premium cards offer perks designed to provide added value and help justify the higher annual fees, but it’s important to assess whether you can fully utilize them.”
BONUS TIP!
Daniels warns against overspending to cash in on a credit. “I’ve even caught myself spending more than I planned just to use a credit, which defeats the purpose. Credits are best when they genuinely help cover the annual fee and fit how you already spend,” she says.
How competition between issuers drives benefit inflation
“Benefit inflation” is a fascinating phenomenon often seen in the competitive world of premium credit cards. Simply put, card issuers strive to outshine their rivals by offering increasingly impressive and unique benefits. This competition can lead to a cycle of rising fees, funded in part by merchant fees charged to accept cards, commonly known as swipe fees. These fees represent a significant revenue stream for credit card companies and help support the premium perks that make these cards attractive.
On a related note, “coupon book fatigue” is a complaint among some cardholders. As premium cards offer more small monthly credits, some consumers are complaining that the hassle factor outweighs the monetary value of such credits.
Gerri Detweiler, a credit expert and author of “The Ultimate Credit Repair Action Plan,” isn’t a fan. In fact, she believes that such credits can lead to overspending. “I don’t love the coupon book approach because it can encourage unnecessary spending. I don’t shop at Lululemon or Saks, for example, and I don’t like to feel that I’m missing out if I don’t,” she says.
In short, card fees are climbing, but so are the bonuses, credits, and benefits. While it’s somewhat helpful to be aware of this process, what matters most is how it impacts your ROI on your own individual card(s).
Daniels is quick to teach her readers that “it all comes down to value in, value out.” And that you should “be realistic about what those benefits are actually worth to you.” She adds that “card issuers keep adding new credits and features to stand out, but more doesn’t always mean better. It’s easy to get caught up in the list, but what really matters is value in, value out. You want the math to work in your favor. Consider the benefits that make sense for you and ignore the rest.”
Consumers weigh value: Are credit cards with annual fees worth it?
It’s often easy to quickly access the value of some reward cards with nominal annual fees in the $50-$200 range. However, the math can become trickier for premium cards, especially when evaluating annual fee credit cards that offer travel credits, lounge access, and enhanced rewards. When considering these options, it’s important to determine if the annual fee is worth paying by comparing the value of the rewards and perks to the cost of the fee.
Detweiler believes that “when a card is no longer a no-brainer, it’s time to take a closer look and figure out if you’re getting enough value to justify the fee.” She speaks from personal experience. For annual fee credit cards, she notes that assessing annual fee worth requires a careful look at the benefits and whether they make the fee worth paying.
“Honestly, I’m struggling with this myself as I have two premium cards that have hiked their annual fees recently,” she says. “One I’ve held for years and the other I’ve had less than a year. One will have to go, as I just can’t justify spending that much on annual fees. And I may downgrade both!”
➤ SEE MORE:Are credit cards with annual fees worth it?
How to calculate the break-even point on rewards
Calculating your break-even point on rewards is vital. I like Detweiler’s simple approach. She recommends cardholders to “go line by line through the rewards to figure out which ones you use, whether you are more than covering the fee, and whether you still are getting enough value to keep your card.” Your spending habits and card usage play a crucial role in determining if you get enough value from the card to justify the annual fee.
Daniels’ approach is similar, but she likes to focus on smart spending and budgeting. “If the rewards cover things already in my travel or everyday budget, I’m not overspending. I’m just paying for them in a smarter way,” she says. “If I’m paying close to nine hundred dollars for a premium card, then I want to get back much more than that in flights, hotels, or credits for things I already pay for. That’s not overspending. It’s saving money and often upgrading how I travel in the process. Those are things already in my budget.”
Real-world example: Spending vs. point value
Over the years, I’ve found that real-world examples are incredibly helpful when analyzing a card’s return on investment (ROI). I share some of these insights in my book, “How You Can Profit from Credit Cards: Using Credit to Improve Your Financial Life and Bottom Line.” Daniels offers a compelling personal anecdote that illustrates this well.
- When she opened the Amex Platinum Card, the annual fee was $695, and she earned a 175,000-point welcome bonus. She also earned points through normal spending — groceries, gas, and bills — nothing extra.
- She used those points to book two business-class flights to Europe that would have cost her about $2,500 in cash. Between the annual fee and flight taxes, she paid around $900 total. For the sake of comparison, two economy seats on the same route would have cost more.
At the end of the day, Daniels says she “paid less, flew business class, and finally understood why people pay for premium cards.” She looks at premium cards differently now.
“Even with the higher fee of annual_fees now, I’d look at whether it helps me travel better and spend less on the trips I’d already be taking,” she says. “That trip flipped my perspective. I paid less than economy prices and got a business class experience.”
Statement credits vs. actual usage
Travel or dining credits are attractive if you already are spending in those areas (and most consumers are). But more specific credits, like streaming services or shopping credits, can end up being a hassle. When redeeming rewards, using them as a statement credit can directly offset charges on your card, helping to reduce your out-of-pocket costs and maximize the value of your rewards.
Daniels notes that “the same card can look completely different depending on how you travel. A business traveler might value upgrades and lounge access, while someone else might focus on using points to take more family trips.”
She reminds her readers that “the right card isn’t about how many benefits it offers, it’s about how many actually fit your life.” When choosing a card, evaluate the full range of credit card benefits—such as travel credits, lounge access, and purchase protections—to ensure they align with your needs. She gives another personal testimony to underscore her point.
“I thought the Amex Platinum’s hotel credit would be great for an anniversary trip, but the properties were farther out than we planned to stay and ended up costing more. It felt like I’d be sacrificing convenience and paying more just to use the credit, which defeats the purpose. Now I pay closer attention to which credits actually save me money or make things easier.”
BONUS TIP!
Like any rewards card, it doesn’t make sense to earn rewards if you carry a balance and pay interest, as these cards normally have higher APRs (than non-reward cards). You can’t out-earn interest charges with points or perks, so paying it off in full each month is key.
Final thoughts and alternatives for infrequent travelers
In closing, premium cards are still worth it for consumers who travel on a regular basis. If you don’t travel frequently, it probably makes sense to look for cheaper options. Daniels suggests starting with a lower-fee reward card, such as a card branded with a particular airline, in the same points system.
Hotel cards are another alternative, offering perks like free night awards, room upgrades, and elite status for loyal customers. Some hotel cards even provide a free night award each calendar year on your account anniversary, adding significant value for occasional travelers.
Alternatively, a card with a more palatable annual fee, like the American Express(R) Gold Card discontinued_disclaimer, is a good way to dip your toes in. “You still get strong earning rates and useful credits, but without the pressure of making a high annual fee pay for itself,” says Daniels. The thinking here is that once you know which benefits you actually use, you can tell if a premium card would actually be worth it.
Furthermore, you have to be an aggressive spender to make these cards work for you. Specifically, if you’re only charging $1,000 a month or less, consider other options.
Detweiler astutely notes that “the individuals who get the most out of the highest priced premium cards are probably spending a lot” to take advantage of various bonus point offers. If that’s not you, a simpler, less expensive, even no-annual-fee card would likely be the wiser choice.
See Rates and Fees for the American Express Platinum Card(R)
