Potential Fee Increases for American Express Cards

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Potential Fee Increases for American Express Cards. American Express announced that many of its top credit cards might soon undergo changes. This includes possible fee hikes. Current and future cardholders should be prepared to weigh the benefits and perks against the potential higher costs.

The Announcement

Recent statements from American Express CEO Stephen Squeri indicate that fee increases are likely. In a quarterly earnings call with investors, Squeri emphasized that refreshing the card lineup is a top priority. These changes often come with fee hikes. According to Squeri, these refreshes are a vital part of the company’s business strategy. They help boost demand for Amex cards and have proven successful in the past.

Cards Likely to See Fee Increases

Squeri did not specify which cards will see changes, but there are a few likely candidates:

The Platinum Card® from American Express

The Platinum Card® from American Express is a prime candidate for a fee increase. The last significant update to this card was in the summer of 2021 when the annual fee was raised from $550 to $695. Given the company’s history of modifying this card every three to four years, another update seems imminent. At the end of 2022, Squeri hinted that the card’s fee could rise even higher, noting that the fee for the Platinum Card® in Mexico is $1,000.

The American Express® Gold Card

The American Express® Gold Card is another card that might see a fee increase. This card hasn’t had a major refresh since 2018, and its annual fee has remained at $250 for several years.

Other Cards Could Also See Increases

While the Platinum and Gold cards are the most likely to experience fee hikes, they are not the only ones. Squeri mentioned that most or all of Amex’s 40 cards might undergo changes. Recent updates to Delta cobranded cards illustrate this trend, as these updates often include price increases.

Delta SkyMiles® Cards

The Delta SkyMiles® Reserve American Express Card recently saw its fee increase by $100 when new perks were added, such as credits for hotel stays, ride-hailing services, and Resy. Other Delta cards in the Amex lineup also experienced fee hikes. For example, the Delta SkyMiles® Gold American Express Card saw its fee increase from $99 to an introductory annual fee of $0 for the first year, then $150. Squeri stated that these changes exceeded the company’s expectations, indicating that this strategy will likely continue.

Impact on Consumers

If American Express raises fees on popular rewards cards, most consumers are expected to stay with the company. Historically, Amex has seen strong retention rates despite fee increases. In the first quarter of 2024, the company reported a 16% increase in revenue from annual fees.

However, whether you should keep your card depends on your personal situation. You need to consider how high the new fee is, which perks you will actually use, and whether the benefits outweigh the costs. If the new fee is justifiable based on the benefits you receive, you may decide to keep the card. If not, there are many other great credit cards available that might better suit your needs.

Conclusion

American Express cards offer many benefits, but they come at a cost. With the potential for fee increases, it is essential for cardholders to assess whether the perks justify the higher fees. If you find the benefits worth the price, the card might still be a valuable tool. If not, exploring other credit card options could be a wise decision.

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