Your ultimate guide to credit card retention offers

May 5, 2020

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Editor’s note: This is a recurring post, regularly updated with new information.

Although we at TPG love sign-up bonuses, savvy award travelers are always looking for opportunities to earn extra points and miles to keep balances high for the next vacation. Today we’re going to talk about credit card retention offers, which can be a great way to earn bonuses with the cards you already have.

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(Photo by Getty Images.)

In This Post

What are retention offers?

Once a credit card issuer has spent hundreds of dollars (in the form of a cash or points welcome bonus) to entice you to open a card, they need to find a way to recoup that investment. If you close your card after only a year or two, the issuer will lose money on you.

So some (but not all) issuers will offer you a retention bonus to keep a card open longer. These bonuses can take the form of points, statement credits or even reductions or waivers of an annual fee — anything that helps persuade you to keep the card open (and, in the issuer’s eyes, keep spending on the card).

Related reading: 5 ways the global recession is affecting credit cards and banks — and the upside for some cardholders

How to ask for a retention offer

One common misconception about retention offers is that you can only get them if you’re trying to close a card. It’s true that you’ll generally have the most success asking for a retention offer right around the time your annual fee posts (since that’s when many people decide to cancel a card), but you can try your luck at any time.

Related reading: My Amex Platinum retention bonus: 20,000 Membership Rewards points

With more companies using automated phone systems, how you phrase your request is very important. Instead of saying, “I’d like to close my credit card,” and hoping the agent makes you an offer, you need to say, “I’m considering closing my card,” or, “I’m not sure I want to keep paying the annual fee on my card.” I’ve heard horror stories of people who said they wanted to close their card and the automated system shuttered the account before they could ever speak to a human being about it.

Each issuer handles retention offers differently. Some, like American Express, have a dedicated retention department you can ask to be transferred to. For other cards, a front-line customer service representative might be able to help you. You can adapt the script to suit your own needs, but my calls usually go something like this:

“Hi, I noticed that the annual fee on my ______ card just posted and I’m really not sure I can justify paying it for another year. I really like (insert your favorite benefits), but I’m just not sure about this annual fee. I was wondering if you could check if there were any retention offers available on my account that might help me make up my mind?”

American Express is using this graphic to show the value of the Amex Platinum Card. (Image by American Express)
American Express is using this graphic to show the value of the Amex Platinum Card. (Image by American Express)

At this point, you can expect the corporate marketing to kick in and the agent will read you some talking points about why the card is so great and worth keeping. You’ll need to deflect, which you can do by bringing the discussion back to the annual fee you don’t want to pay, by mentioning that you have other cards with similar perks (especially if you have multiple Marriott/Delta/Hilton cards, for example), or by saying that you just don’t find yourself spending much on the card. Remember, at no point should you actually say, “I want to close the card” — only that you’re thinking about it.

This is purely anecdotal, but I’ve found Amex to be the most generous with retention offers. Chase almost never gives them out. Other card issuers may do so, but much less frequently.

What types of offers are there?

Depending on the issuer, there are three different offers you might receive:

  • Annual fee reduction or waiver: Depending on the card, this can be as good as cash. Even if you don’t plan to use the card much, if you get an annual fee waiver, you can keep the card open for another year, boosting your credit score. When you factor in perks like statement credits or elite status, an annual fee reduction may be enough to push the card past its break-even point.
  • Bonus points: Sometimes you’ll simply be given points for agreeing to keep the account open, though more often than not it will be an offer similar to an initial welcome bonus: Spend X amount of money in the next three months in order to earn bonus points.
  • Statement credits: Same as above, sometimes applied directly to the account but more often requires some spending to earn.

It goes without saying that the more you spend on a card, the more likely you are to receive an offer. Issuers want to keep their most valuable customers. Sometimes you might even be given a choice between a statement credit or bonus points, in which case you can quickly pull up TPG’s monthly valuation series and decide which offer is better.

(Photo by Eden Batki/The Points Guy)
(Photo by Eden Batki/The Points Guy)

As an example, I recently received a retention offer on my Marriott Bonvoy Brilliant™ American Express® Card after reminding the representative that I spend more than $100,000 a year across all my Amex cards. I was given the choice between a $100 statement credit or 30,000 bonus points after spending $5,000 in the next three months. TPG values those points at $240, and I value them even higher with my Marriott Titanium status, so it was a no-brainer for me to pick the points.

A number of readers in the TPG Lounge also shared some retention offers they’ve received in the last year:

  • Barclays AAdvantage® Aviator® Red World Elite Mastercard®: I’d otherwise spend zero, but [I received] a $100 statement credit for spending $1,000 a month on the card for three months (which I’ve done for two years now).” — Brandon P.
  • The Platinum Card® from American Express: 30,000 Membership Rewards® points for $4,000 in spending; American Express® Gold Card: 20,000 points for $3,000 in spending in three months. — Martin F.
  • Amex Platinum: 30,000 for $3,000 in spending in three months. “I’ve had the card since 2007 and this is the first time I asked, based on reading Lounge posts! The points posted immediately. I put next to no spending on this card; I only use it for the 5x airfare.” — Loren G.

Coronavirus-related exceptions

Retention offers tend to be highly targeted and personalized for each individual account, but in light of the ongoing coronavirus pandemic, some issuers are making more general policy changes. One of the biggest problems is that customers are currently unable to use the travel credits and benefits on most of their cards, even if they pay hefty annual fees each year to keep the card open. These are slightly different than traditional retention offers. Here’s a roundup of current coronavirus related exceptions that might encourage you to keep your travel rewards cards open for another year:

  • Chase is offering Sapphire Reserve customers with card renewal dates between April 1 and July 1, 2020, a $100 statement credit toward their annual fee. This directly offsets the $100 increase in the CSR’s fee that occurred earlier this year at the same time that DoorDash and Lyft benefits were added to the card.
  • Amex is rolling out a broad suite of limited-time perks, bonus categories and statement credits across its credit card portfolio. You should read this guide for full details and to see if any of your cards are covered, but the offers include elevated bonus categories, expanded statement credits and repurposing travel credits so that they can be used at restaurants and for food delivery.

Bottom line

Every time an annual fee hits on one of your cards, you have to make the decision to keep it open or cancel it. Even if you think you know what you want to do, you can’t be sure until you have all the information in front of you. Spending five to 10 minutes on the phone might net you enough points for a free one-way flight to Europe on a card you already wanted to keep open. In terms of pure return on time, there aren’t many deals better than that.

Featured photo by Fox Photos / Hulton Archive / Getty Images

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Editorial Disclaimer: Opinions expressed here are the author’s alone, not those of any bank, credit card issuer, airlines or hotel chain, and have not been reviewed, approved or otherwise endorsed by any of these entities.

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