Annual Fees on Rewards Cards Increasing

Rewards credit cards are very popular with consumers. They are also becoming increasingly more expensive. These types of credit cards that offer rewards and rebates in the form of cash back, travel and so forth are also very popular with banks. They market them heavily in both print and television commercials.

Fees on rewards credit cards used to be the exception as opposed to the rule. Not anymore. Now, depending upon what credit card issuer you apply with, there is a pretty good chance that you’ll see annual fees on rewards cards. And that’s a trend that looks to continue to arc higher and higher.

Statistics from market research company Synovate show that in the third quarter of 2008, 21% of rewards card offers came with an annual fee. That number has now jumped to 28% for the third quarter of 2009.

In fact, now, only one month into the fourth quarter of 2009, we see that 36% of rewards cards now charge an annual fee in one form or another. The amount of annual fee you will pay of course is dependent upon what type of card it is.

The more elaborate the rewards program, the more you’ll pay. For example, the American Express Premier Rewards Gold Card charges an annual fee of $175 per year, while the American Express Preferred Rewards card charges $125 per year. Travel rewards cards have always charged higher fees than their counterparts.

Traditionally for the most part basic rewards cards do not carry annual fees. Currently Discover More and Chase Sapphire cards have no annual fees. However, many analysts predict that the fees will become more and more popular as credit card reform limits the ability of banks to raise interest rates.

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