My Latest American Express Retention Offer
Credit cards are probably the easiest way to earn a bunch of miles, quickly, in order to take those awesome first class trips and stay at luxury hotels. And it’s no secret that the signup bonuses for these cards range from 30,000 to over 100,000. The problem is that most of these cards limit those signup bonuses to once in a lifetime. Enter, the retention bonus.
What is a retention bonus?
Credit card companies go to great lengths to capture “wallet share.” There’s only SO much room in your wallet for cards, and they want to make sure that their card is in there. After all, they’re earning swipe fees on each and every purchase, so it’s a pretty lucrative business. So if you call in to cancel your card, they’ll usually offer you a little (or sometimes not so little) bonus to stick around.
Types of Bonuses
There are three main categories of credit cards: Points earning, Miles earning, and cash back cards. Depending on the type of card you have, you might be given an annual fee credit, a points/cash bonus after meeting a qualified spend, or some extra cash back after meeting a certain goal.
Don’t go for the fee waiver
The first thing that they’ll try and offer you is a fee waiver. They’ll usually come at you with “Oh, if you don’t want to pay the fee, as a valued card member, we can waive that for you for another year…” This is the first offer they’ll throw out, and most people bite!
So, what did I get offered?
The annual fee on the credit card I was cancelling is $195, and the offer to stay was a $75 fee credit. Hardly what I was hoping for. I then asked if there was a way to earn any extra Skymiles for sticking around an extra year. He perked up and said “well, we can give you a very generous 2,500 miles now and another 5,000 miles when you spend $2,000 in the next 3 months.”
So… $195 for 7,500 miles? Naw, I’m good! I know that’s 2.6 cents a mile, but that’s a lot of money for not a lot of miles. 25,000 miles and I would have stuck around.
In the past, I’ve received a 25,000 Delta miles for one card, 5,000 American miles AND a fee waiver for another card, and 25,000 points on a different card, so this offer just wasn’t as good.
Anyone else have any retention bonus success they’d like to share?