# Why do credit card companies charge annual fees for certain cards? **URL:** \ **Category:** Factual Questions\ **Created:** [August 31, 2025, 10:17pm UTC](https://boards.straightdope.com/t/why-do-credit-card-companies-charge-annual-fees-for-certain-cards/1022640 "2025-08-31T22:17:08Z")\ **Posts on this page:** 7\ **Page:** 2
**Author:** ![Reply](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/reply/32/15952_2.png) [@Reply](https://boards.straightdope.com/u/Reply)\ **Post date:** [September 2, 2025, 8:10pm UTC](https://boards.straightdope.com/t/why-do-credit-card-companies-charge-annual-fees-for-certain-cards/1022640/21 "2025-09-02T20:10:53Z")
> [@LSLGuy](#): > > But a gym that sells memberships where 100% of the members work out every day or an “all you can eat” buffet where everyone fills their plates 10 times with the most expensive stuff can’t stay in business I’d rather these things just be priced appropriately (and by usage), rather than gambling and hoping that most of their customers don’t actually use the perks they pay for. That applies to everything from buffets to “unlimited” internet. For example, I’d be happy with a travel card that offered a limited # of lounge uses per year (like many airlines already offer), maybe a discount on travel insurance or limited claims per year, etc. But the CC companies don’t do that, instead offering unsustainable sign-up bonuses, unlimited perks that will always end up being abused by the top 1% of users, etc. Shrug. That’s on them. Chase is now one of the world’s biggest companies, so I guess their strategies are working. I think the Reserve was always intended to be a loss-leader marketing effort more than a sustainable offering. In its wake, many other banks offered similar cards, Chase itself launched lower tiers of the Sapphire along with other partnered travel cards, etc. But when it first launched, it made quite a stir and basically jumpstarted that category of travel cards, which was previously reserved for old, rich Amex and Discover holders. Now that it’s a common thing, it’s not at all surprising they have to scale back the benefits. In fact I’d be surprised if that wasn’t the plan all along. The Sapphire basically put Chase on the map for a whole new generation of cardholders. ---
**Author:** ![Reply](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/reply/32/15952_2.png) [@Reply](https://boards.straightdope.com/u/Reply)\ **Post date:** [September 2, 2025, 8:19pm UTC](https://boards.straightdope.com/t/why-do-credit-card-companies-charge-annual-fees-for-certain-cards/1022640/22 "2025-09-02T20:19:27Z")
> [@Tride](#): > > Really low coverage limits, like a couple grand. CSR is $10k per person per occurrence with a $50k annual limit. And that’s if you put ANY part of the travel on the card, not all of it. $800/year for $10k of coverage seems like a very high premium, though? We recently did price some travel insurance coverage (despite having the CSR) and I think it was a couple hundred bucks for a couple weeks of better coverage. We didn’t end up getting it, but that’s more because we had friends where we were going. If you travel a lot every year, it probably makes sense. We’re more one-big-vacation-a-year types, and for that, the new benefits vs costs just don’t make sense anymore. It went from terrific value to poor. ---
**Author:** ![Tride](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/tride/32/13907_2.png) [@Tride](https://boards.straightdope.com/u/Tride)\ **Post date:** [September 2, 2025, 8:32pm UTC](https://boards.straightdope.com/t/why-do-credit-card-companies-charge-annual-fees-for-certain-cards/1022640/23 "2025-09-02T20:32:51Z")
We do some pricy travel. Last time I priced covering my annual heli-ski trip it was more than the CSR fee just for that. Plus I have almost a million miles in that account. The reserve pays 3-8x depending on the type of purchase. ---
**Author:** ![Dewey\_Finn](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/dewey_finn/32/4222_2.png) [@Dewey\_Finn](https://boards.straightdope.com/u/Dewey_Finn)\ **Post date:** [September 2, 2025, 8:34pm UTC](https://boards.straightdope.com/t/why-do-credit-card-companies-charge-annual-fees-for-certain-cards/1022640/24 "2025-09-02T20:34:22Z")
Okay, you’re in a completely different league than me, when it comes to travel. ---
**Author:** ![Reply](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/reply/32/15952_2.png) [@Reply](https://boards.straightdope.com/u/Reply)\ **Post date:** [September 2, 2025, 8:38pm UTC](https://boards.straightdope.com/t/why-do-credit-card-companies-charge-annual-fees-for-certain-cards/1022640/25 "2025-09-02T20:38:18Z")
Yeah 🙂 @Tride probably spends more on travel in a year than I would in a few lifetimes. ---
**Author:** ![Telemark](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/telemark/32/372_2.png) [@Telemark](https://boards.straightdope.com/u/Telemark)\ **Post date:** [September 2, 2025, 8:48pm UTC](https://boards.straightdope.com/t/why-do-credit-card-companies-charge-annual-fees-for-certain-cards/1022640/26 "2025-09-02T20:48:21Z")
> [@Reply](#): > > $800/year for $10k of coverage seems like a very high premium, though? Chase Sapphire Preferred (CSP) is $99/year and offers many of the same benefits, although certainly not all. The 70K SUB and $50/year hotel benefit pays for 10+ years of the card, and trip and car rental insurance is all gravy. ---
**Author:** ![Tride](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/tride/32/13907_2.png) [@Tride](https://boards.straightdope.com/u/Tride)\ **Post date:** [September 2, 2025, 8:52pm UTC](https://boards.straightdope.com/t/why-do-credit-card-companies-charge-annual-fees-for-certain-cards/1022640/27 "2025-09-02T20:52:46Z")
Probably $30-40k a year in travel? It’s a lot, but it’s our only big expense. Otherwise we’re homebodies. I drive a 2010 truck with 208,000 miles on it. Went out for pizza the other night. Woo hoo! [Previous page](https://boards.straightdope.com/t/why-do-credit-card-companies-charge-annual-fees-for-certain-cards/1022640.md?page=1)