Phobic
When I first got into the points and miles game roughly 5 years ago, I was very fee phobic when it came to annual fees connected to rewards cards. That phobia has subsided some and full disclosure, I willingly paid the $450 annual fee for the Amex Business Platinum. Thus far though, it’s been worth every penny. Even with that said, I still earn and manufacture points as cheaply as possible. Two general rules still follow me in the points game, I don’t like paying for points, and I don’t like annual fees. You might say that everyone doesn’t like credit card annual fees, but some people, bloggers among them, don’t seem to mind much.
I’ve had the Flexperks (which used to be a Delta linked card many years ago) for about 20 years now and it’s the oldest credit line in my file. So keeping that credit line open, especially with many new rewards card applications on the horizon, is very important to keeping a high and healthy credit score. With plenty of redemption use in the past 2 years, I still have upwards of 300,000 Flexperks, so I don’t feel a big pull to keep earning these rewards. I’ve instead opted to downgrade into a no annual fee version – the US Bank FlexPerks Select+ American Express card.
If you’re new to points and miles, Flexperks is a propriety bank points currency. As long as you hold one of the bank’s linked rewards earning credit cards, your points won’t expire. So my downgrade into a no annual fee Flexperks card will keep my earned points safe. Flexperks has lost some of the luster it had in the past when it changed to a fixed 1.5 cents per point redemption value in January 2018. For domestic and cheap international flights, I still find value in the currency.
The annual fee on the Flexperks has become obsolete for my needs and uses
Rewarded?
Credit card annual fees are prepayment for a future reward. You’re shelling out money up front to get some reward or benefit in the future. Points and miles runners are usually quite adept at getting the most out of those fees, but annual fees can pile up quickly with plenty of justifications after. Some of those justifications make sense, while others have much thinner validity. I did a recent rundown of my credit cards (20 currently) and separated them into cards that I’m keeping, cancelling, and downgrading. Those with annual fees that don’t earn outsized rewards (rewards that are far beyond the annual fee) are on the chopping block.
The U.S. Bank Flexperks card has a $49 annual fee. It’s annual fee is low for a rewards card, but the main draw for me has been 2x on grocery. Grocery manufactured spend (MS) has become expensive, and cost per point is important to me. My area only has 1 reliable supermarket that sells $500 debit (gift) cards that can be purchased with a credit card. I also do most of my grocery shopping at local co-ops and Whole Foods. The co-ops offer members good discounts every month and Whole Foods earns me 5x (via gift cards purchased at Staples with the Chase Ink Plus). When earning 2x Flexperks vs. 5x Ultimate Rewards and co-op discounts is compared, Flexperks doesn’t really stack up.
Downgrade
Downgrading from the U.S. Bank Flexperks to the FlexPerks Select+ American Express card was simple. Just call in and ask. On my call, the representative didn’t bother to try and persuade me to see the card or sell me into another product. She just let the downgrade happen and did so quickly. She said that I’d most likely see a statement credit on my next statement credit.
The FlexPerks Select+ American Express earns 1 point for every dollar spent plus I’m still able to redeem Flexperks at 1.5 cents per point. By downgrading, I’m keeping my card’s history with the bank alive which will positively impact my credit score. I can still MS the card if need be too, so for me it’s an all around win. In the past I’ve used points to pay for the annual fee, but I’m tightening some strings around annual fees and only spending what’s really necessary. I don’t view this card as absolutely necessary, plus I’m guessing that upgrading back into the regular Flexperks wouldn’t be an issue down the road if I desired to do so.There are other Flexperks downgrade options such as the US Bank Cash 365 American Express Credit Card, which earns 1.5% cash back on all purchases. I’m a high utilizer of cash back and 1.5% isn’t competitive with other options in my wallet, so that card isn’t of interest to me.
I know plenty of people in the same boat that I’ve been in. They hold the U.S. Bank Flexperks card and have done so for many years. The annual fee is quite low, which makes it easy to keep and pay. For those who have high grocery spend or viable MS options at supermarkets in their area, the card still holds outsized value beyond the annual fee. I’ve just opted to take a different path. If you’re still holding the card and paying an annual fee, are the rewards that you’re getting justifying the fee?
