The Denver Post - - BUSINESS - By Ken Sweet

The big­gest months for adding and drop­ping credit cards are De­cem­ber and Jan­uary, so now’s the time to make sure that $95 an­nual fee is re­ally worth it. Chances are, it’s not. “Gen­er­ally, for the av­er­age credit card holder, it is not likely they are go­ing to use a card with a high an­nual fee enough to jus­tify it,” said Matt Schulz, a credit card ex­pert with Cred­, which is owned by

Banks raked in $90.3 bil­lion in credit card fees in 2014, ac­cord­ing to Bankrate, and ad­di­tional fee hikes last year by some com­pa­nies mean that num­ber is only go­ing to grow. Amer­i­can Ex­press raised the fee on its pop­u­lar Premier Re­ward Gold Card and its co-branded credit card with Star­wood Ho­tels from $65 to $95 last year, for ex­am­ple.

Schulz says banks are low­er­ing in­ter­est rates they are charg­ing on card­hold­ers who carry a bal­ance but are rais­ing an­nual fees to help gen­er­ate in­come.

Here are some things to con­sider as you think about what cards to keep.

Why pay an an­nual fee at all? Maybe be­cause you have no choice: Some cards aimed at peo­ple with poor credit carry fees be­cause th­ese cus­tomers are con­sid­ered high-risk.

But of­ten cards with an­nual fees come with some kind of ben­e­fit that the user thinks is a good deal. There are dozens of cards that al­low users to earn fre­quent flier miles or points to­ward a free ho­tel stay.

If you must pay, make sure it’s worth it. Cal­cu­lat­ing the value of some credit card ben­e­fits, like ones that let you check a bag free on an air­line, is straight­for­ward. If you fly United and check a bag— $25 a pop, usu­ally — more than four times a year, you have more than jus­ti­fied the $95 an­nual fee on Chase’s United Visa card.

You’re bet­ter off with­out one. Nearly all re­wards credit cards re­quire a large amount of a par­tic­u­lar type of spend­ing to jus­tify the fee. If you’re not do­ing that, then you’re wast­ing money.

The best bet, usu­ally, is a cash­back card with no an­nual fee. You won’t be tempted to buy stuff that looks like a bar­gain if you buy it with points, but it may be stuff you don’t need. Get­ting cash back gives you the power to do what’s best with your money — like pay off any credit card bal­ances as soon as pos­si­ble.

If all else fails, threaten to walk. The credit card in­dus­try is ex­tremely com­pet­i­tive. Banks don’t want to lose your busi­ness.

An­nual fees can be ne­go­ti­ated, Schulz said. While not ev­ery com­pany will waive the en­tire fee, some­times the com­pany will re­duce the fee or throw in an ex­tra ben­e­fit, like a bun­dle of points, if a cus­tomer threat­ens to leave.

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