Ever glance at your credit card bill and wonder, Why am I still paying this annual fee? What benefits am I receiving?
This week, financial expert Vivian Tu joins us to answer pressing questions about credit cards: How many cards are too many? Are those premium travel cards worth their hefty fees? What should you do if a card no longer serves you?
We'll discuss evaluating whether the perks are worth the costs and how to use credit card points effectively — without it feeling like a part-time job.
Are High-End Credit Cards Worth Their Fees?
Jean Chatzky: I've been curious about premium travel cards like the Amex Platinum, Chase Sapphire Reserve, and Venture X. Are they really worth the expense? How do you determine if you're getting enough value?
Vivian Tu: It all comes down to how much you utilize the benefits. Review the introductory materials or the card's website. Check the perks and assign a dollar value to each. Consider: How often do I use these benefits, and do they offset the fee?
These cards can cost around $795, $695, or $395. Think about how frequently you take advantage of their offerings. Does it balance out?
Airline Cards vs. Flexible Points: Which is Best?
Jean Chatzky: I've committed to American Airlines with their business card. Since I fly out of Philadelphia, it's often my go-to. It just makes sense.
Vivian Tu: It really hinges on your travel patterns. If you're frequently flying from a hub, an airline-specific card might be beneficial. I don't have a loyalty card since I travel across various airlines, but if I had a stable job location, I'd probably pick a primary airline for my loyalty.
Vivian Tu's Key Takeaway: Fewer Cards with Purpose
Having more credit cards isn't always advantageous. Vivian Tu advises keeping three to five cards, which is typically sufficient for building credit, earning rewards, and maintaining low utilization without overcomplicating your finances.
Each card should serve a clear purpose: managing daily expenses, enhancing travel experiences, or providing protections you would otherwise incur costs for. If a card no longer aligns with your life, like if you don't fly that airline anymore, it may be time to reassess your options.
