The average credit card annual fee was $127 in 2025, according to data from the Consumer Financial Protection Bureau,
Some widely used credit cards don't charge fees, such as Capital One Quicksilver Cash Rewards and the Citi Double Cash® Card. But access to the best rewards credits usually comes at a premium.
Before applying for a card with an annual fee, here's how to determine whether the benefits are worth the cost.
Terms apply to American Express benefits and offers. Visit americanexpress.com to learn more.
Offers in this section are from affiliate partners and selected based on a combination of engagement, product relevance, compensation, and consistent availability.
Earn a limited-time $300 Capital One Travel stays credit, plus earn 75,000 bonus miles
Terms apply.
Earn a bonus of 20,000 miles once you spend $500 on purchases within three months from account opening, equal to $200 in travel
$0
What is an annual fee?
A credit card annual fee is a yearly charge a card issuer applies for the privilege of owning a particular credit card. The charge is typically a flat fee applied regardless of whether you use the card that year.
Some credit cards have no annual fee, but cards that offer cash back, miles, points, lounge access or statement credits often do — as do cards aimed at consumers with poor credit.
Lower-tier cards with modest perks may charge $25 to $99, but some high-end cards have annual fees in the high-three-digit range. (In addition to its one-time $10,000 initiation charge, the American Express Centurion Card, a.k.a. the "Black Card," has a staggering $5,000 annual fee.)
What to consider when evaluating a credit card annual fee
The annual fee eats into any rewards you may enjoy, so it's important to calculate how much value those rewards will bring.
1. Welcome bonuses
Whether it's cash back, miles, a statement credit or a membership, a generous welcome bonus can help offset a card's annual fee, especially if you can comfortably meet the spending requirement without buying things you wouldn't otherwise purchase.
But it's important to consider whether the card will retain its value in year two, when the welcome bonus is no longer a factor. Look at the annual fee and other card benefits, both with and without the welcome bonus. You can also calculate the value of the welcome bonus over the number of years you expect to keep the card to determine its true value.
The Chase Sapphire Preferred credit card has a $95 annual fee, but members earn 75,000 bonus points after spending $5,000 in the first three months from account opening.
The Chase Sapphire Preferred® Card packs a punch for a $95 annual fee card, offering annual travel credits, comprehensive travel protections, flexible rewards and more.
- You can transfer rewards to all of Chase's travel partners including World of Hyatt, Southwest Rapid Rewards and many more
- Long list of travel and shopping protections
- Annual Chase Travel hotel credit
- Has an annual fee
- Requires a high credit score
Highlights
Highlights shown here are provided by the issuer and have not been reviewed by CNBC Select's editorial staff.
- Earn 75,000 bonus points after you spend $5,000 on purchases in the first 3 months from account opening.
- Enjoy benefits such as 5x on travel purchased through Chase TravelSM, 3x on dining, 3x on vacation homes at top brands, 3x on gas & EV charging, 3x on top streaming services and online groceries (excluding Walmart, Target, and wholesale clubs), 2x on all other travel purchases, 1x on all other purchases.
- Earn up to $100 in statement credits each account anniversary year for hotel stays through Chase TravelSM.
- Count on Trip Cancellation/Interruption Insurance, Auto Rental Coverage, Emergency Evacuation and Transportation, and more.
- Get a year of complimentary Apple TV when activated by December 31, 2026 - a value of $180.
- Complimentary DashPass membership, a $120 value for 12 months. Enjoy $0 delivery fees and reduced service fees on eligible DoorDash orders, plus exclusive Chase savings on grocery, everyday essentials, and more. Activate by 12/31/29.
- Receive one statement credit of up to $120 every four years as reimbursement for the application fee charged to your card for a Global Entry, TSA Precheck® or NEXUS application.
- Transfer points to leading airline and hotel loyalty programs.
- Member FDIC
Balance transfer fee
Either $5 or 5% of the amount of each transfer, whichever is greater
2. Ongoing benefits
You also need to look beyond the welcome bonus and consider whether you'll use the card's regular benefits year after year. These may include travel insurance and airport lounge access, purchase protection, credit monitoring and even roadside assistance.
See if you can assign a monetary value to the perks that are most beneficial to you. The more often you'd use them, the easier it is to justify the annual fee.
The Capital One Venture X Rewards credit card has an annual fee of $395. But it includes up to $800 per claim for cell phone damage or theft, with a $50 deductible and a maximum of two approved claims per 12-month period.
It also offers primary rental car collision coverage, President's Circle® status from Hertz and a variety of travel perks.
The Capital One Venture X Rewards Credit Card is a premium credit card with a myriad of benefits and a lower annual fee than other high-end cards with similar features.
- Annual $300 credit for bookings through Capital One Travel
- 10,000 bonus miles after every card anniversary
- Unlimited complimentary access to 1,300+ airport lounges, including Capital One Lounge and Landing locations
- Long list of valuable travel and shopping protections, including return protection, rental car coverage and trip delay reimbursement (Benefit(s) only available to accounts approved for the Visa Infinite card. Terms apply.)
- Limited bonus spending categories compared to other premium credit cards
- High annual fee
- High credit score requirement (excellent credit)
Highlights
- Earn 75,000 bonus miles when you spend $4,000 on purchases in the first 3 months from account opening, equal to $750 in travel
- Receive a $300 annual credit for bookings through Capital One Travel, where you'll get Capital One's best prices on thousands of trip options
- Get 10,000 bonus miles (equal to $100 towards travel) every year, starting on your first anniversary
- Earn unlimited 10X miles on hotels and rental cars booked through Capital One Travel and 5X miles on flights and vacation rentals booked through Capital One Travel
- Earn unlimited 2X miles on all other purchases
- Enjoy access to 1,300+ lounges worldwide, including Capital One Lounge and Landing locations and participating Priority Pass™ lounges, after enrollment
- Use your Venture X miles to easily cover travel expenses, including flights, hotels, rental cars and more—you can even transfer your miles to your choice of 15+ travel loyalty programs
- Enjoy a $100 experience credit and other premium benefits with every hotel and vacation rental booked from the Premier Collection
- Receive up to a $120 credit for Global Entry or TSA PreCheck®
- Top rated mobile app
Balance transfer fee
$0 at the Transfer APR, 4% of the amount of each transferred balance that posts to your account at a promotional APR that Capital One may offer to you
Foreign transaction fees
$0
3. Annual credits and rewards
Some cards offer recurring credits that can substantially offset the annual fee, especially co-branded airline and hotel cards. (One free night's stay a year can more than cover the cost of a card.)
Rather than assuming you'll receive the full advertised value, add up the credits you're realistically likely to use each year. Then factor in the value of any rewards you expect to earn.
You could easily offset the American Express® Gold Card's $325 annual fee (see rates and fees) with the more than $500 in statement credits from participating restaurants, hotels and ride-share companies.
The American Express Gold Card is great for earning valuable Membership Rewards® points at restaurants worldwide and U.S. supermarkets. Membership Rewards® points transfer to many of the top airline and hotel loyalty programs, which makes this card one of the best options for earning travel rewards.
- You can earn $400+ in dining and rideshare credits every year (Enrollment required for select benefits mentioned)
- Exceptionally rewarding for eligible restaurant and U.S. supermarket purchases
- No foreign transaction fees
- Large annual fee
- Credits are more complicated, you earn them monthly or semi-annually
- Spending caps on the top bonus categories
Highlights
Highlights shown here are provided by the issuer and have not been reviewed by CNBC Select's editorial staff.
- You may be eligible for as high as 100,000 Membership Rewards® Points after you spend $8,000 in eligible purchases on your new Card in your first 6 months of Card Membership. Welcome offers vary and you may not be eligible for an offer. Apply to know if you're approved and find out your exact welcome offer amount – all with no credit score impact. If you're approved and choose to accept the Card, your score may be impacted.
- Earn 4X Membership Rewards® points per dollar spent on purchases at restaurants worldwide, on up to $50,000 in purchases per calendar year, then 1X points for the rest of the year.
- Earn 4X Membership Rewards® points per dollar spent at US supermarkets, on up to $25,000 in purchases per calendar year, then 1X points for the rest of the year.
- Earn 5X Membership Rewards® points on prepaid hotel stays booked through AmexTravel.com or the Amex Travel App™.
- Earn 3X Membership Rewards® points on flights booked through AmexTravel.com, the Amex Travel App™, or purchased directly from airlines.
- Earn 2X Membership Rewards® points on prepaid car rentals booked through AmexTravel.com or the Amex Travel App™ and cruises booked and paid through AmexTravel.com.
- Earn 1X Membership Rewards® point per dollar spent on all other eligible purchases.
- Pay It® lets you tap in the American Express® App to quickly pay for small purchase amounts throughout the month and still earn rewards the way you usually do. Plan It® gives you the option to split up big purchases into equal monthly payments with a fixed fee. You'll know upfront exactly how much you'll pay.
- $120 Dining Credit: Earn up to a total of $10 in statement credits monthly when you pay with the Gold Card at Grubhub (including Seamless), Buffalo Wild Wings, Five Guys, The Cheesecake Factory, and Wonder. This can be an annual savings of up to $120. Enrollment required.
- $100 Resy Credit: Get up to $100 in statement credits each calendar year at over 10,000 qualifying U.S. Resy restaurants after you pay for eligible purchases with the American Express® Gold Card. That's up to $50 in statement credits semi-annually. Enrollment required.
- $84 Dunkin' Credit: Earn up to $7 in monthly statement credits after you pay with the American Express® Gold Card at U.S. Dunkin' locations. Enrollment required.
- $120 Uber Cash on Gold: Enjoy up to $120 in Uber Cash annually with your Gold Card. Just add your Card to your Uber account and you'll get $10 in Uber Cash each month to use on orders and rides in the U.S. when you select an Amex Card for your transaction.
- Enjoy complimentary Hertz Five Star® Status benefits like skipping the counter at select locations, adding an additional driver at no additional cost*, and vehicle upgrades**. Benefit enrollment and Hertz Gold+ registration are required. *Additional drivers must meet standard rental qualifications and must be a spouse or domestic partner to qualify as complimentary. Other additional drivers subject to fees. **Benefits are subject to availability and vary by location. Additional Hertz program Terms and Conditions including age restrictions apply.
- Book two nights or more with The Hotel Collection through AmexTravel.com or the Amex Travel App™ and receive a $100* credit towards eligible charges at over 1,400 upscale hotels worldwide. *Eligible charges vary by property.
- Book your travel through the Amex Travel App™ with added peace of mind – backed by American Express® service and support. Only for American Express® Card Members.
- Whenever you need us, we're here. Our Member Services team will ensure you are taken care of. From lost Card replacement to statement questions, we are available to help 24/7.
- No Foreign Transaction Fees.
- Annual Fee is $325.
- Terms Apply.
- See Rates & Fees
Foreign transaction fee
None
4. Rewards rates
Frequent travelers and people who spend heavily in bonus categories may find it easier to justify an annual fee.
Compare how much you could earn with the card against an alternative with no fee — and be sure to be realistic about whether the rewards align with your everyday spending habits.
A higher rewards rate isn't necessarily better if you don't spend much in those categories.
Offers in this section are from affiliate partners and selected based on a combination of engagement, product relevance, compensation, and consistent availability.
On Chase's site
Earn $200 cash back
See rates and fees. Terms apply.
When paying a credit card annual fee may be worth it
A credit card annual fee is usually worth it when you determine the welcome bonus, ongoing benefits, annual credits and rewards provide a value that is greater than paying for those features out of pocket.
It might not require that much analysis: A standard Priority Pass membership costs $99 per year, plus $35 per visit. "The Hilton Honors American Express Surpass Card, for example, has a $95 annual fee and currently includes 10 complimentary Priority Pass visits per year.
If you're in doubt about whether a card is worth the fee, ask yourself these questions:
- Does the welcome bonus provide enough value to justify the fee?
- Will I earn enough rewards to offset the annual fee?
- Will I regularly use the card's benefits?
- Will I take advantage of statement credits?
Remember, you don't have to use every benefit a card offers to justify the annual fee, just enough to offset the cost.
When a credit card annual fee may not be worth it
A credit card annual fee may not be worth paying if you're unlikely to use enough of the card's benefits and rewards to offset the cost. This can be especially true if you rarely travel, don't spend heavily in the card's bonus categories or can get similar rewards from a no-annual-fee card.
Consider skipping or downgrading a card if:
- The welcome bonus is doing all the work.
- You won't use the card's benefits.
- The rewards categories don't match your spending habits.
- You're paying for credits you won't use.
- A card with no fee offers comparable value.
- The rewards requirements encourage you to overspend.
Let's say you're comparing a card with a $95 annual fee that earns 3% cash back on all purchases.
Assuming there are no other card benefits, you'd have to spend $9,500 each year (or $792 per month) to cover the $95 charge.
3% vs. 2% = 1 percentage point of additional rewards
$95/0.01 = $9,500
If you know you charge less than $9,500 a year, it doesn't make sense to get the card with an annual fee.
Of course, in the real world, credit cards rarely have just one type of benefit. If you're on the fence, you can consider other perks you reasonably expect to get good use out of.
Offers in this section are from affiliate partners and selected based on a combination of engagement, product relevance, compensation, and consistent availability.
On Chase's site
Earn a limited-time $300 Capital One Travel stays credit, plus earn 75,000 bonus miles
Terms apply.
Annual-fee vs. no-fee credit cards
A no-fee card may be accepted at the same locations and offer the same credit limit as a card with an annual fee.
The main difference is added value — sign-up bonuses, premium rewards, access and protections. The key is deciding whether those intangibles are worth the fee and the effort of meeting the requirements to enjoy them.
How to get a credit card annual fee waived or lowered
If you're looking for a new credit card, some issuers will waive the annual fee for the first year.
If you're debating whether your current card is worth the annual fee, you can try asking for a retention offer — it could be a one-time waiver, a lump sum of points or a rewards offer after spending a certain amount.
Call customer service and ask for the retention department. Make your case, stating why you no longer get full value from your credit card — this may include that the fee has recently increased, you use other cards more often, or your spending habits or finances have shifted.
If you don't receive a retention offer, you can ask to be downgraded to an alternative card with a lower (or no) fee.
Closing a line of credit like a credit card can have a negative impact on your credit score, but it may be worth it if you don't get value from the card anymore. Let the representative know you're considering canceling the card if there is no alternative.
FAQs
When do you pay the annual fee on a credit card?
Credit card annual fees are typically first paid when you open a new account, though some cards waive the fee for the first year. Cardholders will then pay again each year the account remains open, usually in the anniversary month of the account's opening.
Can you get the annual fee on a credit card waived?
You can ask a card issuer whether it will waive the annual fee or offer a retention offer, such as bonus rewards or a statement credit. There's no guarantee it will work, but it's worth asking before you decide to cancel or downgrade the card.
Do you have to pay an annual fee if you don't use the card?
Yes, a credit card annual fee generally applies whether or not you use the card. If you don't think you'll get enough value from the card to justify the fee, you can ask the issuer about waiving the fee, offering a retention incentive or downgrading the account to a card with no annual fee.
Is a credit card annual fee worth it?
Whether a specific card's annual fee is worth it depends on the rewards it offers, as well as your spending habits and budget. A card with a handsome welcome bonus may be worth the fee for the first year, but no longer provide adequate value in year two.
The CNBC Select Recommends newsletter delivers practical money tips each week along with expert-picked financial product recommendations. Sign up here.
Why trust CNBC Select?
At CNBC Select, our mission is to provide our readers with high-quality service journalism and comprehensive consumer advice so they can make informed decisions with their money. Every credit card article is based on rigorous reporting by our team of expert writers and editors with extensive knowledge of credit card products. While CNBC Select earns a commission from affiliate partners on many offers and links, we create all our content without input from our commercial team or any outside third parties, and we pride ourselves on our journalistic standards and ethics.
Catch up on CNBC Select's in-depth coverage of credit cards, banking and money, and follow us on TikTok, Facebook, Instagram and Twitter to stay up to date.
Read more
For rates and fees of the American Express® Gold Card, click here.
*The American Express® Gold Card welcome offer: To view your personalized offer, you must first submit an application. If approved, you will: (1) receive your Welcome Offer details, (2) have the option to accept the Card with that offer, (3) be required to spend $8,000 on eligible purchases within the first 6 months of Card Membership, and (4) earn Membership Rewards® points. Welcome offers vary and you may not be eligible for an offer.
