American Express and Chase Just Raised the Bar on Credit Card Fees — Here's Exactly What to Do
American Express and Chase — two of the most widely held credit cards in the country — have just set a new precedent for credit card fees, and if you’re not paying attention, you’re going to pay for it. Literally.
This isn’t the first time card issuers have quietly nudged fees upward. But this move is different. When the two biggest names in premium credit cards move in lockstep on pricing, it signals a structural shift in the industry — not a temporary blip. Every other issuer is now watching, and most will follow. That means the math on your current card setup may have just changed, whether you’ve noticed it yet or not.
Here’s what’s actually happening, what it costs you if you do nothing, and the five concrete moves to make right now.
What American Express and Chase Actually Changed
The details are still rolling in, but the direction is clear: both issuers are raising annual fees and restructuring rewards redemption rates on several of their flagship products. Premium cards — think the kind with airport lounges, travel credits, and high sign-up bonuses — are getting the biggest increases.
This follows a well-worn playbook. In 2023, the Amex Platinum annual fee was raised to $695. Chase’s Sapphire Reserve has sat at $550 since its own increase. Now both companies appear to be resetting the baseline again, pushing fees higher while adjusting the benefit math that justifies those fees.
Why it’s happening: Card issuers are dealing with rising customer acquisition costs, higher fraud losses, and pressure on interchange revenue following ongoing regulatory scrutiny of swipe fees. They’re making up the margin on the consumer side. Meanwhile, the arms race for premium cardholders — who spend more, carry fewer balances, and generate massive interchange on big purchases — continues to escalate.
What it means for the average cardholder: If you’re paying $550–$695 a year for a premium card and not extracting at least that much in tangible value, you are subsidizing wealthier, higher-spending cardholders. That’s not a metaphor. It’s the math.
The True Cost of Ignoring This
Let’s put real numbers on what inertia costs you.
Say your current premium card has an annual fee of $550. You use it casually — some travel, some dining — but you’re not aggressively redeeming rewards. Research consistently shows that a large portion of credit card rewards go unredeemed every year. One industry estimate puts unredeemed loyalty points at over $16 billion annually across U.S. consumers.
If your card’s effective annual benefit — the real dollar value you extract from credits, points, and perks — is only $200, you’re losing $350 a year. Over five years, that’s $1,750. Invested at a conservative 8% annual return, that’s over $2,570 you didn’t build toward your future.
Now layer a fee increase on top of that gap, and the math gets worse fast.
This is not a small thing. For people in their 20s and early 30s who are serious about building wealth intentionally, credit card fees are a category worth auditing every single year — not just when an issuer sends you a notice.
5 Moves to Make Right Now
1. Run the “True Annual Value” Audit on Every Card You Hold
This is non-negotiable. For every card with an annual fee, calculate your net annual value:
Net Annual Value = (Benefits You Actually Use) − Annual Fee
Benefits to count:
- Statement credits you actually redeem (travel credit, dining credit, streaming credit, etc.)
- Points earned in the past 12 months × their real redemption value (not the inflated “up to” number in marketing materials)
- Protections you’ve actually used: purchase protection, travel insurance, extended warranty
Benefits to not count:
- Credits for services you wouldn’t otherwise pay for
- Lounge access you used once
- Sign-up bonuses (they’re one-time events, not recurring value)
If your net annual value is negative — even by $1 — you have a decision to make.
2. Know Your Downgrade Options Before You Cancel
Canceling a credit card outright can ding your credit utilization ratio and shorten your average account age — both factors in your credit score. Before you cancel, call the issuer and ask about downgrading to a no-fee version of the same card.
Both Amex and Chase have no-annual-fee cards in their product lineups. Downgrading preserves your account history and your credit limit while eliminating the fee drag. You’ll lose some premium perks, but if you weren’t using them, that’s a net win.
Key script for the call: “I’ve been reviewing my annual fee and I’m not finding enough value to justify it at the new rate. Can you tell me what downgrade options are available on my account?”
Issuers will sometimes offer a retention bonus — points, a statement credit, or a temporary fee waiver — to keep you on the premium tier. Ask directly: “Is there any offer available to help offset the annual fee?” Cardholders who call and ask get retention offers far more often than those who don’t.
3. Reassess the No-Annual-Fee Card Landscape
The narrative that you need a premium card to earn good rewards is increasingly outdated. Several no-annual-fee cards now offer:
- 2% flat cash back on all purchases (some even offer 2.5%)
- 5% rotating category bonuses on groceries, gas, or online shopping
- Solid travel insurance protections
- No foreign transaction fees
If you spend $2,000/month on a 2% cash-back card, you’re earning $480/year — with zero annual fee. That’s real money, and it compounds your net worth instead of draining it.
For people investing even modest amounts monthly, redirecting a saved $400–$700 in annual fees directly into a Roth IRA or brokerage account is a meaningful wealth-building lever.
4. Stop Optimizing for Points, Start Optimizing for Cash
This is controversial in the travel-hacking community, but it’s the honest take: points are a liability, not an asset. Issuers can and do devalue points programs — often with little notice. When you hold unredeemed points, you’re holding an asset whose value is controlled entirely by the issuer.
Cash back, by contrast, is cash. It doesn’t expire. It doesn’t get devalued in a program overhaul. And it’s instantly usable for anything — including investing.
If you’re not a frequent traveler or you don’t have time to optimize redemptions, a simple cash-back setup almost always beats a points-heavy premium card on a net-value basis. The math favors simplicity.
5. Set a Calendar Reminder for Annual Fee Review — Every Year
Card issuers are betting on your inertia. They raise fees gradually, restructure benefits quietly, and count on most cardholders not doing the math. The antidote is dead simple: set a recurring calendar reminder 30 days before each card’s annual fee hits.
Use that window to:
- Run the net annual value audit (see Move #1)
- Call and ask for a retention offer
- Compare current alternatives in the market
- Decide: keep, downgrade, or cancel
Thirty days gives you enough time to act before the fee hits and to avoid the hassle of fighting for a refund after the fact. Most issuers will refund a fee if you cancel within 30 days of it posting, but why scramble when you can plan?
What This Signals for the Broader Credit Card Market
When Amex and Chase move together, the rest of the industry follows. Capital One, Citi, Barclays, and every other major issuer will be watching consumer response to these fee increases. If cardholders absorb the increases without pushback — which the data suggests most will — expect more increases within 12–18 months.
At the same time, regulators are still circling the interchange fee debate. The Consumer Financial Protection Bureau has been scrutinizing credit card late fees and certain pricing practices, and while the regulatory environment under the current administration is relatively issuer-friendly, that can shift.
For now, the smart play is to treat this moment as a forced audit — one that most people won’t do. The cardholders who optimize now will be better positioned regardless of where fees land next year.
The Bigger Picture: Debt Is a Tool, Not a Trophy
Credit cards, at their best, are a cash-flow management tool and a rewards engine. At their worst, they’re an expensive habit dressed up in points and prestige.
The people building real wealth in their 20s and 30s treat credit cards instrumentally — extracting value where it makes sense, cutting where it doesn’t, and never letting a high annual fee become a fixed cost they’re too lazy to question. Your emergency fund, your retirement contributions, your investment accounts — those are wealth. A metal card with an airport lounge is a perk, and perks don’t compound.
If this fee news is your wake-up call, use it. Run the audit, make the calls, and redirect whatever you save into something that actually builds your net worth. If you’re still figuring out where to park that extra money once it’s freed up, the breakdown on Roth IRAs vs. 401(k)s is a good place to start — and for anyone with a less predictable income, budgeting around irregular cash flow makes sure that freed-up money actually sticks.
The issuers are betting you’ll do nothing. Prove them wrong.
— The Dropout Millions Team
