Let’s face it. Nobody likes to pay credit card annual fees.
In the world of travel credit cards, there are top-dollar credit cards with annual fees of $450 or more, packed with lucrative travel benefits that can make them worth the cost. At the other end of the spectrum, there are no-annual-fee cards, which come at the right price but rarely have great perks or bonuses. But there’s an important middle ground: Travel cards that waive their annual fee for your first year.
These cards are a sweet spot. They allow you to test out a travel card for a year – and earn a big welcome bonus – without having to fork over a big annual fee. Can’t justify the price tag in year two? Cancel it – or downgrade it.
In this post, we will break down the best travel rewards credit cards with the annual fee waived for the first year of card membership.
Citi AAdvantage Platinum Select World Elite Mastercard
The Citi AAdvantage Platinum Select World Elite Mastercard tops our list of the best credit cards with the annual fee waived for the first year. Just for opening the card and spending $2,500 in the first three months of card membership, you will earn 50,000 American Airlines AAdvantage miles. And yes, the card’s $99 annual fee is waived for the first year of card membership.
Critically, even if you never step foot on an American Airlines plane, these miles are absolutely worth earning thanks to American’s incredible partner airlines. You can use your new stash of AAdvantage miles to book flights with Qatar Airways, Japan Airlines, Cathay Pacific, and more.
Click Here to learn more about the Citi AAdvantage Platinum Select World Elite Mastercard.
But that’s not all that stands out about this card. While most airlines have just one bank, American partners with two.
That’s significant because you can earn the welcome offer bonus on each American Airlines credit card, netting you 100,000 American Airlines miles after paying one annual fee in the first year on the Barclays AAdvantage Red Aviator Card and spending $2,500 on the Citi AAdvantage Platinum Select Card in the first three months of card membership.
You’ll earn an additional 50,000 AAdvantage miles after making just one purchase and paying your $99 annual fee on the AAdvantage Aviator Red World Elite Mastercard.
Related reading: The Best American Airlines Credit Cards for Travelers in 2021.
If you own a small business and have the ability to get approved for a business credit card, the CitiBusiness AAdvantage Platinum Select Mastercard also waived the $99 annual fee for the first year. Additionally, you can earn another 65,000 American Airlines miles after spending $4,000 in the first four months of card membership.
Click Here to learn more about the CitiBusiness AAdvantage Platinum Select Mastercard
Delta SkyMiles® Gold American Express Card
The Delta SkyMiles® Gold American Express Card is another excellent airline card with the annual fee waived for the first year. The card currently earns 40,000 Delta SkyMiles after spending only $1,000 in the first three months of card membership – far from the best signup bonus we’ve seen on this card.
But you’ll also earn 2x SkyMiles for every dollar you spend at restaurants, supermarkets, and on Delta purchases. Plus, you’ll get a $100 Delta flight credit if you spend at least $10,000 on the card in a calendar year (terms apply).
Finally, the card offers you a free checked bag and priority boarding each and every time you fly with Delta. Critically, you don’t even need to pay for the flight with your card to get the free bag benefit.
And again, you won’t be on the hook for the $99 annual fee until you renew your card for your second year (if you choose to do so). See rates & fees.
Click Here to learn more about the Delta SkyMiles Gold American Express Card
There’s also a business version of the Delta Gold card as well, dubbed the Delta SkyMiles® Gold Business American Express Card. And similarly, the card’s $99 annual fee is waived for the first year (see rates & fees)
Click Here to learn more about the Delta SkyMiles Gold Business American Express Card
United Explorer Card
The United Explorer Card is currently offering 40,000 Miles after spending $2,000 in the first three months of card membership. You’ll also earn another 25,000 miles (65,000 total) after you spend $10,000 in the first six months. Once again, the card’s $95 annual fee is waived for the first year of card membership.
You’ll also get free checked luggage, earn 2x United MileagePlus miles for purchases at United, hotels, and at restaurants, and 25% back on United in-flight purchases.
But what sets the United Explorer card apart is that it also offers up to a $100 credit to cover the cost of either TSA PreCheck or Global Entry. Membership in both programs is good for five years, and you will receive this credit on your card every four years. The Explorer card is one of just a few cards with the annual fee waived for the first year that offers this benefit.
Click Here to learn more about the United Explorer Card
Just as with the Delta and American cards above, the $99 annual fee is also waived for the first year on the United Business Card which is offering a welcome offer bonus of 75,000 miles after spending $5,000 in the first three months of card membership.
Click Here to learn more about the United Business Card.
Blue Cash Preferred® Card from American Express
The only cashback card on the list which still provides fantastic value is the Blue Cash Preferred® Card from American Express.
The card is currently offering a welcome bonus of 20% back on Amazon.com purchases on the Card within the first 6 months of Card Membership, up to $200 back. Plus, earn $150 back after you spend $3,000 in purchases on the Card within the first 6 months of Card Membership. You will receive cash back in the form of statement credits. And as a part of this offer, the card’s $95 annual fee is waived for the first year (see rates & fees).
You’ll also earn 6% back on up to $6,000 in spending each year at U.S. supermarkets (then 1% back), and 6% back on select U.S. streaming subscriptions like Spotify, Netflix, Hulu, and many more.
You’ll earn 3% cash back on transit which includes taxis, rideshare, parking tolls, trains, buses, and more. Finally, you will earn 1% cash back on all other purchases.
Click Here to learn more about the Blue Cash Preferred Card from American Express
Should You Cancel Your Card Before Year Two?
One of the best things about grabbing one of these credit cards with the annual fee waived for the first year of card membership is that you won’t have to make any hard decisions for the first year.
Just make sure you meet the spending requirement to earn your welcome bonus and use the benefits as best you can for your first year. Think of it as a test run: Get some bonus points (or cashback) and see how you like it before committing to paying for the card.
Whether or not it makes sense to renew the card for a second year will largely depend on how you use it. Are you getting more value out of the card than what you’d pay for the annual fee? Then there’s no reason to cancel it.
For example, let’s say you’ve got the Delta SkyMiles Gold American Express Card because you plan to fly frequently with Delta – and check a bag. Checking a bag costs $30 each way on most flights.
That means checking a bag on just two round-trip flights a year is saving you $120 in baggage fee. That alone is enough to justify paying the card’s $99 annual fee, regardless of the other benefits it offers.
What Happens to Your Airline Miles if You Close Your Card?
If after a year with one of these cards that waives the first-year annual fee you decide it just doesn’t have enough value to pay for another year, you’ll be faced with all of the decisions that go into canceling a credit card. First and foremost, what will happen with you airline miles?
Because of the way these airline miles work, you don’t need to worry: Once they hit your account, they are yours to keep. The bank cannot claw them back once you decide to close your credit card.
But that’s not the case if you are closing a card issued directly from a bank that earns points, like the Chase Sapphire Preferred Card or the American Express® Gold Card. If you have any points left on these cards before you cancel, they will be forfeited.
Next, oftentimes it will make sense to downgrade your card to a card with no annual fee if that is an option rather than cancel the card altogether. It keeps your credit history on the card intact while accomplishing your goal of removing the annual fee.
Walk through all of the questions to ask yourself before you close a credit card.
Credit card annual fees are big business for the banks. And oftentimes, because of the benefits the cards that charge them provide, they can be worth it. But this list of credit cards with the annual fee waived for the first year is worth a look for the perfect in-betweener solution.
All of these cards allow you to try the card out of a year and take advantage of the benefits before having to commit in terms of an annual fee.