3 Reasons Annual Fees Are the Secret to Free Travel

I used to think paying an annual fee for a credit card was a scam. Why would I shell out $95, $350, or even $695 just for the privilege of using a credit card?

Then I booked a luxury hotel room in Italy with points, breezed through airport security, and chilled in a lounge before my flight -- all thanks to the perks that came with my travel card. And just like that, I stopped hating annual fees.

Here are three reasons they're worth it, and how you can make sure you're getting your money's worth.

1. The perks usually pay for themselves

Let's say your card has a $95 or $350 fee. That might sound steep -- until you realize what you're getting in return.

Many travel cards come with benefits that are worth the annual fee several times over. Think:

• Travel credits (like $100-$300 toward flights, hotels, or incidentals)
• Free checked bags (worth $60 or more per round trip)
• Airport lounge access (a lifesaver during delays)
• Hotel upgrades and late checkout
• Priority boarding or elite status with hotels and airlines

Even using just one or two of these perks on a single trip could cover the fee. One of my favorite travel cards only charges $95 a year -- and the value of the welcome bonus alone more than makes up for the annual fee for the next several years.

2. You earn way more points

Cards with annual fees tend to have better earning rates -- which means more free travel, faster.

For example, a no-fee travel card might earn 1.5x points across the board. A $95 card might earn 3x on dining and 2x on travel. A premium card might go even higher and give you bonuses on flights, hotels, groceries, and more.

That adds up fast, especially if you're using your card for everyday spending. And more points means more trips. Simple as that.

3. The welcome bonus alone can make it worth it

Many top travel cards offer a welcome bonus of 60,000 points or more after you spend a certain amount in the first few months. That's often worth $750+ in travel -- sometimes even $1,000 or more if you use your points strategically.

So if you're debating whether to pay that $95 or $350 upfront, remember this: You're getting hundreds in free travel in exchange. It's a no-brainer if you're planning a trip in the next year.

Start racking up free travel

Annual fees aren't something to fear; they're just part of the equation. If the perks, points, and bonuses you're getting are worth more than what you're paying, it's a win.

I've used travel credits to wipe out airline fees, relaxed in airport lounges that felt like mini hotels, and saved thousands of dollars on flights and hotels. And that was only possible because I paid for the right card.

Ready to see which cards offer the most perks for the price? Check out our favorite travel cards here.