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Updated October 25, 2016

These Credit Cards Have a $95 Annual Fee, but Here's Why It's Worth Considering

Editorial Note: This content is not provided by the card issuer. Opinions expressed here are author's alone, not those of the issuer, and have not been reviewed, approved or otherwise endorsed by the issuer.
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These credit cards have an annual fee, but if you have great credit, we will explain why they are worth it.

If you spend less than $334/month, then consider no annual fee cards instead.

Many people are quick to dismiss credit cards with an annual fee. After all, why would you pay to use something you're meant to spend on?

But if you're regularly spending $1000 a month on your credit card, here's why you should consider it:

Credit cards with annual fees typically offer much better rewards than their no annual fee counterparts. Whether they offer bigger sign-up bonuses, better rewards, or more flexibility in redeeming travel, depending on your lifestyle, the rewards you receive could far outweigh the annual fee.

We find that cards with a $95 annual fee fits that sweet spot of good rewards and good perks, while still being affordable enough for the everyday user.

You Wouldn't Believe Its Rewards

Do you like to travel? Travel credit cards can help you earn flights and hotel stays.

Our favorite is the Chase Sapphire Preferred. It has a huge bonus point offer and premium travel benefits.

Chase Sapphire Preferred
Apply for Chase Sapphire Preferred Card
Chase Sapphire Preferred lets you earn 50,000 bonus points after you spend $4,000 on purchases in the first 3 months from account opening. That's $625 toward travel when you redeem through Chase Ultimate Rewards®. You can earn 5,000 bonus points if you add your first authorized user and make a purchase within the first three months from account opening. This card lets you earn 2X points on travel and dining at restaurants & 1 point per dollar spent on all other purchases worldwide. The points can be transferred 1:1 to leading frequent travel programs including airline transfer partners. The card has a $0 foreign transaction fee. The card also comes with premium travel and purchase protection benefits (including trip cancellation/trip interruption insurance and auto rental collision damage waiver). There is an Introductory Annual Fee of $0 the first year, then $95.

Imagine what you would do with $625?

A flight to Las Vegas? A weekend hotel stay in New York?

While $4,000 might sound like a lot to spend in 3 months, keep in mind that the average household spends over $10,000 a year on just food, apparel and entertainment. How much do you spend a month on your credit card?

Tip: Here's an airline miles trick that airlines don't want you to know. You don't have to fly to earn airline miles. A few credit cards, like the Chase Sapphire Preferred, lets you earn reward points that can transfer into airline miles with airline transfer partners at a 1:1 ratio.

Chase Sapphire Preferred airline transfer partners include Southwest Airlines, United Airlines, British Airways (oneworld), Air France (SkyTeam), Korean Air (SkyTeam), Singapore Airlines (Star Alliance), and Virgin Atlantic.

This is a great way to help you rack up more miles toward free flights and upgrades.

Chase Sapphire Preferred also has hotel transfer partners if you rather convert your points toward free hotel stays. Hotel transfer partners include Marriott, Hyatt, IHG, and The Ritz-Carlton.

But this card has a drawback. It is only for people with excellent credit.

To learn more about the Chase Sapphire Preferred, including the online application, click here to visit Chase's secure website.

Remember, banks change their promotional offers all the time, so if you have great credit, now is the time to apply.

Grocery and Gas

Do you spend over $334 per month?

Do groceries, gas and department store shopping take up most of your budget? Blue Cash Preferred from American Express, a CreditDonkey partner, has an interesting rewards structure. Read on.

Blue Cash Preferred
Apply for Blue Cash Preferred Card from American Express
Blue Cash Preferred offers $150 back if you spend $1,000 on purchases within the first three months of opening your new credit card account. This card earns 6% at U.S supermarkets (on up to $6,000/year in purchases, then 1%), 3% at U.S gas stations, and 1% on other purchases. The cash back is earned in the form of Reward Dollars that can be redeemed as a statement credit. There is a $95 annual fee.

Plus, there is a 0% introductory APR for 12 months on purchases and balance transfers. After the introductory period, a variable APR applies, currently 13.49% to 23.49%. Terms and limitations apply.

Tip: Is the $95 annual fee worth it? If you spend over $61/week at U.S. supermarkets, you'll get more value out of this card than it's no annual fee counterpart (Blue Cash Everyday).

To learn more, read our Blue Cash Preferred review or visit American Express' secure website.

Rewards Are Almost Impossible for Some to Resist

Do you spend over $1,000 per month?

Starwood Preferred Guest Credit Card from American Express, a CreditDonkey partner, lets you earn Starpoints.

If you like to travel, Starpoints are hard to resist, in my opinion. Here's why:

  • You can redeem Starpoints for hotel stays at Starwood hotels such as Sheraton, Westin, St Regis, W Hotels, Meridian, Element, Loft, and Four Points.

  • You can also convert Starpoints to airline transfer partners such as Alaska Airlines, American Airlines, Delta, and Hawaiian Airlines.

Starwood Preferred Guest
Apply for Starwood Preferred Guest Credit Card from American Express
Starwood Preferred Guest offers 25,000 bonus Starpoints® if you spend $3,000 on purchases within the first three months of opening your new card account. You earn 2 Starpoints® for each dollar of eligible purchases spent on the Card at participating SPG® & Marriott Rewards® hotels. You earn 1 Starpoint for all other purchases. You can redeem points at over 1,300 participating hotels and resorts in over 100 countries with no blackout dates. There are no foreign transaction fees. There is a $95 annual fee ($0 introductory annual fee for the first year). Terms and conditions apply.

It gets better. Redeem Starpoints for 5 consecutive nights and get the 5th night free (excluding Category 1 and 2 hotels). Or transfer Starpoints to an airline transfer partner and get 5,000 bonus Starpoints for every 20,000 Starpoints you transfer at one time.

To learn more, read our Starwood Preferred Guest review or visit American Express' secure website.

Fly Delta? Here's Why It's Special

Do you spend over $334 per month?

Do you want to check in your first bag for free on every Delta flight? Do you want to get Priority Boarding on Delta?

Gold Delta SkyMiles
Apply for Gold Delta SkyMiles Credit Card from American Express
Gold Delta SkyMiles offers 30,000 bonus miles if you spend $1,000 on purchases within the first three months of opening your new account. In addition, you can earn a $50 statement credit after you make a Delta purchase with your new card within the first three months. This card earns airline miles: 2 miles per dollar spent on purchases made directly with Delta and 1 mile for every dollar spent on all other eligible purchases. There is a $95 annual fee ($0 introductory annual fee for the first year).

If you fly Delta, here's what you should know: you can check your first bag free on every Delta flight with this card - that is a savings of up to $200 per round trip for a family of 4. Plus, you can enjoy Priority Boarding. Terms and conditions apply.

To learn more, read our Gold Delta SkyMiles review or visit American Express' secure website.

Bottom Line

Credit cards with annual fees are not right for everybody. But for some, they are brilliant.

  • If you don't have great credit, focus on improving your responsible credit management with either credit cards for people with fair credit or no credit. Avoid prepaid debit cards as those cards do not help you build credit history.

  • If you don't pay off your bills in full, focus on a credit card with low interest rates instead. Credit cards with annual fees are better suited for folks who are looking for premium rewards and benefits.

  • If you don't spend over $334 per month, focus on a credit card with no annual fee instead.

Terms and limitations apply.

Charles Tran is the founder of CreditDonkey, a credit card comparison and financial education website. Write to Charles Tran at charles@creditdonkey.com. Our data-driven analysis has been recognized by major news outlets across the country and has helped consumers make savvy financial and lifestyle decisions. (read more)

Editorial Note: Any opinions, analyses, reviews or recommendations expressed in this article are those of the author's alone, and have not been reviewed, approved or otherwise endorsed by any card issuer. This site may be compensated through the Advertiser's affiliate programs.

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CreditDonkey is a credit card comparison website. We publish data-driven analysis to help you save money & make savvy financial decisions.

Editorial Note: Any opinions, analyses, reviews or recommendations expressed on this page are those of the author's alone, and have not been reviewed, approved or otherwise endorsed by any card issuer.

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