The Synchrony Premier annual fee is $0 per year. Synchrony Premier’s $0 annual fee is lower than the average annual fee among new credit card offers right now. It’s not the only fee you need to worry about with the Synchrony Premier World Mastercard®, though.
Credit cards have annual fees to help cover the cost of rewards programs, benefits like travel insurance, and account services such as billing and customer support. Annual fees also help credit card companies profit more, especially on cards that people don’t use much. And in the case of credit cards for people with limited or bad credit, annual fees help credit card companies reduce the risk of lending to unproven borrowers.… read full answer
The most common types of credit cards with annual fees are high-end rewards cards (especially the travel variety), business credit cards, credit cards for bad credit, and rewards cards for people with fair or limited credit. The more perks offered or the more risk there is for the issuer, the more likely there is to be an annual fee.
Do all credit cards have annual fees?
Not all credit cards have annual fees. There are hundreds of no annual fee credit cards available. And some annual fees are a lot bigger than others. They can range from $25 to $550 and up, depending on the card. Some will also waive the fee for the first year. When a card does have an annual fee, that fee is automatically charged to your account once a year. The first fee will be charged to your first month’s credit card statement.
Whether or not a credit card has an annual fee shouldn’t be the only factor you consider when shopping for a card. That’s because whether an annual fee is worth paying depends on what you get in return and what other options are available. You can learn more below.
Here is more on why credit cards have annual fees:
Credit cards assess annual fees mainly to offset the cost of their benefits, rewards and account services. But they’re also a way for credit card companies to make greater profits.
The Credit CARD Act helps explain why credit cards charge annual fees. It limits penalty fees, over-limit fees and APR increases but not annual fees.
Rewards cards, including airline and hotel cards, tend to have the highest annual fees. But their benefits are often worth it if you use the card frequently.
Some major credit card issuers don’t charge annual fees on any of their cards. Others charge fees on about half of their cards.
Business credit cards are more likely to charge annual fees than personal credit cards.
Whether or not you should have a credit card with an annual fee depends on your spending habits and credit standing. If you’ll save more with a card that charges a fee, even with that fee considered, it makes sense. But if you don’t plan to make a lot of purchases, a no annual fee card probably is the way to go.
Credit cards with annual fees are worth it when they save you more than they cost you, especially if your savings exceed what the best no annual fee credit cards available to you would provide. Paying an annual fee on a credit card can unlock bigger initial rewards bonuses, higher ongoing earning rates, and a variety of additional benefits. But you need to make sure you get your money’s worth and actually use the perks you’re paying extra for. If you don't, a credit card that does not charge annual fees may offer better long-term value.… read full answer
Times When a Credit Card Annual Fee Is Worth It
When you can spend enough on the card to earn rewards worth more than the annual fee
Rewards can come as cash back, points, or miles, and if you spend enough to earn lots of them, the rewards alone can pay for your annual fee. If your card gives 1.5% back on purchases and the annual fee is $95, for instance, you’ll have to spend about $6,350 annually to break even with ongoing rewards alone.
When the perks your card offers are things you’re going to buy and use anyway
Annual travel credits, airport lounge memberships, TSA Pre-Check application credits, and free hotel nights are a few high-value perks offered by some credit cards. If you were planning to spend money on these things anyway, the annual fee on a credit card might start to seem like a deal.
When it would save you more than the best card with no annual fee
If you crunch the numbers and determine that a card with an annual fee would save you the most money at the end of the day, even considering the fixed yearly cost, then go for it. Just make sure to reevaluate if your spending or payment plans change.
To figure out if a credit card’s annual fee is going to be worth paying, consider how much you spend – overall and in the card’s major rewards categories. Then calculate how much you would earn with each card’s rewards structure. And evaluate the practical value of the card’s other perks – it’s good to be realistic about how often you’ll use them. Finally, subtract the annual fee. The remainder is how much the card could save you, assuming you pay the bill in full every month and avoid finance charges.
However, there are a number of no annual fee credit cards that offer rewards such as cash back or rewards earned on purchases. But you will need good credit or better to qualify for most of these cards.
A good go-between is a credit card that waives the annual fee for the first year you have the card. After the first year, the fee will be charged to your account. If, after that first 12 months, you’ve determined that having the card isn’t beneficial, you can close the account. Keep in mind that closing a credit card account, especially after only a year, could have a negative effect on your credit score. In addition, when your card is closed, you will be unable to redeem any rewards you’ve earned with the card.
Whether you should have a no annual fee card depends on your spending habits and preferences. If you’ll earn enough in rewards to warrant the cost of an annual fee, it might be worth the investment. But if you know you won’t make too many purchases over the course of a year, your best bet would be to stick with the no annual fee card.
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