Points & Miles

Why I Like Paying Credit Card Annual Fees

Annual fees are the devil! Is something you might have heard when you first started applying for credit cards. I kept up with that for a few years until I started getting into the hotel points and airline miles game. Now 80% of my cards are made up of travel credit cards with annual fees. What changed my mind? One word: value.

After a lot of research, I started weighing the overall value I would receive relative to the cost of the annual fees. This includes the rewards/earning program and the perks of the card. The card that opened my eyes to annual fees was the Hyatt VISA card by Chase, which is now my favorite card that I never use. That’s a story for a different blog post though. It worked out great before I had a kid, and as a parent, it works out even better.

Who Doesn’t Love Free Hotel Nights?

After you’re approved for the card, you can get two free nights to use at any Hyatt property around the world. The only catch is that you have to spend $1,000 in the first three months of having the card. This kind of diminishes the value of the free nights but Hyatt has some really nice properties that can allow you to come close to matching, or even exceeding, the $1,000 you had to fork over.

As an annual perk, you get a free night certificate to use at any Hyatt property within categories one through four. Even though the free night can’t be used at Hyatt’s top tier hotels, there are a number of middle tier properties in the Hyatt portfolio that can easily net you three to five times the value of the annual fee. Even on the low end, you should be able to get at least twice the value, or come close to it. It’s nice to have that free night stashed away for a romantic staycation away from the kids, a last minute trip, or to tack on to a family vacation to reduce some of the cost.

The Perks of Being a Wallflower

While the free nights are the big draw for this card, another useful perk is Hyatt Gold Passport Platinum status. Normally you would reach this status after five paid stays but if you have the card and continue to pay the annual fee each year, you’ll have this status indefinitely. Here are some of the best perks of Platinum status:

  • Complimentary premium internet
  • 2pm late checkout upon request (no charge for an additional night)
  • Preferred rooms (larger rooms or rooms on higher floors, subject to availability)

The preferred rooms are nice because who doesn’t like a higher floor with a nicer view? Hotel internet can be hit or miss but it’s better than nothing if you have spotty cell coverage or if you have a low data limit. The 2pm late checkout is the big benefit. You get to relax for a couple of extra hours and you don’t have to worry about finding a spot to get the kids down for nap time.

Did you ever think you could have a free hotel night and loyalty program status every year without ever stepping foot into a hotel?

The Value Breakdown

To recap, you pay $75 each year on your card anniversary and receive the following benefits:

  • A “free” hotel night that can easily be valued at twice the annual fee. ($150)
  • Platinum status which requires five paid stays. According to statista.com, a site that measures statistics and studies, the average nightly hotel rate in 2015 was $121. ($121 x 5 = $605)

These figures are pretty conservative, but I’d rather give a more realistic view of what’s possible since YMMV (Your Mileage May Vary). Whether or not you use/need the Platinum status, you’re getting hotel status that would normally cost at least $605 if you actually stayed in the hotels. Even if your only Hyatt stay throughout the year is with the help of the free night, you’re getting a great value. In fact, if you’re looking at a hotel that only costs about $150, I would recommend not using your free night. See if you can save it for a room that costs $300+. Last year I used my free night on a room that cost $400. There’s no greater feeling than knowing you maxed the crap out of that free night.


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