Tuesday, January 20, 2015

Retention Year 2

Last year, my father called up his favorite banks and asked if there were any offers to compel him to keep their credit cards open for another year. After all, spending $65-95 every year for each premium credit card can start to add up... especially when we have 30+ cards. So either (a) the banks will have to give him more than that in value each year or (b) will have to waive the fee.

Some cards that we will keep open forever include the Starwood American Express cards (as it helps us re-qualify for Starwood Platinum status each year, offers 2x on Starwood spend and has great Amex promotions) and United Select Visa (as it helps my father re-qualify for United Gold status each year and offers 3x on United spend).

But coincidentally, these were the ones we threatened to cancel last year in the hopes to receive an attractive retention offer. Recall that last year, my father received 2,000 SPG points in exchange for paying the $65 annual fee for his SPG Amex and an additional 5,000 United miles for paying the $95 annual fee for his United Select Visa.

But every year is different.

This time around, my father called Amex and asked to be transferred to an Amex Retention Specialist. My father said he was doing some planning for which credit cards to use and which to cancel for 2015, then asked if there were any upcoming Amex promotions he should know about. Unfortunately, he was told that since he received a promotional offer last year, he was ineligible for another one this year. No harm, no foul.

He did, however, fare better with Chase when he called to inquire about his United Select Visa. This front line customer service representative was authorized to offer my father a $100 statement credit if he kept his card open another year. That would more than offset the $95 annual fee, so he was actually being paid $5 to keep the card. This offer was on top of the regular 5,000 United miles that he receives each year anyway.

Then another day, we called for my mother's Chase British Airways Visa. We signed up a year ago when they were offering 100,000 BA Avios for spending $20k in the first 12 months. We used those BA miles to fly us to Chicago last year and to fly our friends to Orlando last week. When we discussed waiving the annual fee, they told us it wasn't an option. So we told them we'd like to close the account. Then came an offer to give us 9,000 Avios for spending $1,500 in the next three months. That comes out to 6x vs. the usual 1.25x per dollar spent.

So my father accepted that offer and kept the card open. We quickly found a way to spend $1,500 in a few transactions that week and now are awaiting the bonus to post in the Feb 1st statement. Even though we receive the bonus, we'll still close the card afterwards, since the bonus was only contingent upon spending $1,500 on the card and not paying the $95 annual fee.

We still have to call Citi (for my mother's American Airlines Amex) and Barlcays (for my father's US Airways Mastercard), but we'd be OK with closing those down if no compelling offers are made.

[UPDATE: For my mothers American Airlines Amex, we were given a $95 statement credit if we made a $95 purchase, which was actually $10 more than the $85 annual fee. For my father's US Airways Mastercard, they refunded him $89 for the annual fee, though he was only charged $44.50 for the annual fee.]

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