If the annual fee just came due for one of your travel rewards cards, you may find it difficult to justify the expense if you’re not getting enough value in return. If you can’t maximize the card’s benefits, earning rates or redemption opportunities, there may be an option besides paying the annual fee, canceling your card or calling to see if you can snag a retention offer. That option is to downgrade your card.
As a result of provisions of the Credit CARD Act of 2009, you’ll generally need to wait until you’ve had your card for a year before you can downgrade it. However, some issuers have different policies, and there are also some other aspects to consider.
Here’s when you can downgrade your credit card account for most major card issuers — and when it might be a good option.
What does it mean to downgrade a card?
Downgrading your card means switching to another credit card offered by the same issuer with a lower annual fee (or none at all). Because you usually aren’t opening a new account, there typically won’t be a new inquiry on your credit report, and your online login information should stay the same.
You’ll receive a new physical card in the mail that may have a new card number, but your account history, credit limit and other major factors that affect your credit score shouldn’t change.
You can save on annual fees by downgrading your premium cards. However, some issuers base your eligibility for welcome bonuses on which credit cards you’ve had open, not just which cards you’ve earned a bonus on. So be wary that downgrading a card might prevent you from earning a valuable future bonus.
Most issuers only allow you to upgrade or downgrade within a single family of cards. However, issuers may not offer the same downgrade options to all cardholders, and some of your cards may not have any downgrade options. Finally, while issuers may offer bonus points when you upgrade to a new credit card product, it’s unusual for an issuer to provide bonus points to downgrade.
Related: 11 major mistakes people make with travel rewards credit cards
When can you downgrade an American Express card?
American Express doesn’t publicly state a required waiting period before downgrading a card. However, it’s generally best to wait at least one year, as American Express has historically included language in its card offers warning that customers who cancel or downgrade cards within the first year could lose rewards or even have their accounts closed.
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Amex also generally doesn’t allow product changes between personal and business cards, and you typically have to stay within the same card family (such as Delta SkyMiles, Hilton Honors or Marriott Bonvoy). To determine your options and request a downgrade, call the number on the back of your card or log in to your online account and chat with an Amex representative.
American Express has a “one bonus per lifetime” rule. But this rule can be worse than it sounds, as Amex also has some “family” rules that can prohibit you from earning a welcome offer on a card if you hold or have held a higher-tier card in the same family. Hence, it may make sense to downgrade to a card if you wouldn’t be eligible to earn a welcome offer on it anyway.
Related: 3 reasons to downgrade from the Amex Platinum to the Amex Gold
When can you downgrade a Chase card?
Chase may allow you to downgrade your card to another card within the same family if the account you want to downgrade has been open for at least one year. Call the number on the back of your credit card to learn your options or request a downgrade.
Due to Chase’s 5/24 rule, many cardholders prefer to downgrade Chase cards instead of canceling them. But there are other reasons to downgrade a Chase card.
For example, you might try to downgrade the Marriott Bonvoy Boundless® Credit Card (see rates and fees) to the Marriott Bonvoy Bold® Credit Card (see rates and fees) to avoid paying the annual fee.
Related: Transfer Chase Ultimate Rewards points before downgrading your card
When can you downgrade a Citi card?
Citi generally requires you to wait at least 12 months after opening an account before downgrading or product changing your card.
Unlike many issuers, Citi has historically allowed some product changes outside a card’s original family. However, available downgrade options can vary over time and differ from one account to another. Specifically, some recent reports suggest that cross-family conversions may not be available for Citi / AAdvantage and ThankYou Rewards points-earning cards.
To determine your current options, call the number on the back of your card and ask a Citi representative about eligible product changes.
Related: When (and why) you should downgrade from the Citi Strata Premier to the Citi Strata Card
When can you downgrade a Capital One card?
Capital One doesn’t appear to have a hard-and-fast rule about how long your account must be open before you can downgrade a card. However, it’s generally best to wait at least one year before requesting a product change.
Capital One’s downgrade and upgrade options are often account-specific, so call the number on the back of your card or check your online account to see what offers are available.
You generally can’t earn a new welcome bonus on most Capital One cards if you’ve earned a bonus on that card within the last 48 months. Capital One sometimes extends this restriction to other cards within the same card family. So, downgrading your card may let you reduce the annual fees you’re paying until you become eligible for a new welcome bonus.
Related: The best time to apply for these popular Capital One credit cards based on offer history
When can you downgrade cards from other issuers?
Other issuers may allow you to downgrade your card, although some smaller issuers may not offer product changes. A good rule of thumb is to wait until your annual fee posts and then call the number on the back of your card to ask about your downgrade options.
Related: 5 types of credit cards you probably shouldn’t have in your wallet
Bottom line
If you’re not getting your money’s worth from one of the rewards cards in your wallet, downgrading to a no-annual-fee card can be an excellent way to keep your card’s credit line open while avoiding the annual fee. When in doubt, call the customer service line on the back of your card to learn about your options.
Related: How to decide if a credit card’s annual fee is worth paying
Disclaimer : This story is auto aggregated by a computer programme and has not been created or edited by DOWNTHENEWS. Publisher: thepointsguy.com
