What You Should Do Before Canceling Your Travel Card Due to Coronavirus

by Lyle Daly | Updated July 21, 2021 - First published on June 2, 2020

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Thinking of getting rid of your travel card because you can't use it right now? Here's what you should do first.

Travel rewards cards have been a popular consumer choice for years, but they've lost a lot of their luster during the current COVID-19 crisis. Most charge an annual fee, which is easy to justify if you travel enough to get value from it. But if you can't use your card's perks or redeem your rewards because no one's traveling, it makes you question whether you should pay to keep it open.

It's understandable to consider canceling your travel card right now. But there are some steps you should take before you go through with it. 

Check if there are new benefits

Some credit card companies have added new, limited-time benefits that make their travel cards more useful while people are staying home. American Express added bonus rewards on groceries and other updated features to many of its popular travel cards. Chase also made groceries a bonus category on its own travel cards, and it recently made additional updates to its Sapphire cards.

Benefits like these mean your credit card might still provide value, even though you can't travel. It's worth checking for any updates that might make your card's annual fee worth it. 

Ask for a break on the annual fee

Sometimes you can get a break on your card's annual fee just by calling the card issuer and asking. This was true even before the economic issues caused by the novel coronavirus. And now, the fact that so many people are having financial troubles makes it more likely that credit card companies will be open to these requests.

How much of a break you get depends in large part on the annual fee amount. Credit card companies are often willing to waive annual fees of up to about $150. But if your card costs $400 per year or more, a discount is probably the best you can hope for.

Look for downgrade options

Instead of canceling your credit card entirely, you could try downgrading it to a cheaper or no-annual-fee card. There are several benefits to downgrading your card instead of canceling it:

  • You still have that line of credit available if you need it.
  • You'll probably be able to transfer your rewards to your new card, so you won't need to either use them or watch them expire.
  • You keep building your account history, which is beneficial for your credit score.

See if you can get a retention offer

Retention offers are special deals that credit card companies offer when consumers want to cancel their cards. These can be annual fee waivers, bonus rewards, spending credits, or anything else the card issuer thinks is worth offering to retain cardholders.

Call your card issuer to ask if there are any retention offers available. If you call to cancel your card, they might tell you about available offers anyway. Even if they don't, it never hurts to ask and see what you can get.

Review the expiration policy on your rewards

If you're sure about canceling your credit card, then you need to know what will happen to the rewards you've accumulated.

The rewards for airline and hotel credit cards are usually kept in your loyalty program account with that company. That means they won't necessarily expire after canceling the card. On the other hand, if you have rewards with a specific credit card program, they'll typically expire as soon as you cancel the card. In that case, you should either use your rewards or transfer them before you cancel.

Deciding whether to keep your travel card

It won't take long to go through all the steps above, and they're all worth doing so that you can ensure you're making the right decision. If you're planning to cancel your travel card because money's tight during this pandemic, you should also review our coronavirus resources that can help you stay on your feet financially.

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