American Express was one of the card issuers that would give you a prorated refund on your annual fee. This might not make a big difference on some of the cheaper annual fees, but it sure it’s something to consider when it comes to hefty annual fees such as the $450 for the Platinum cards.
From now on there will no longer be a prorated refund, but you’ll still be able to cancel your card within 30 days of the closing date of the billing statement on which the annual fee appears.
As DrGForce reports on Twitter, these are the new terms:
Closing your Account Effective September 1, 2016, in Part 2 of the Cardmember Agreement, we are amending the Closing your Account sub-section in the Other important information section by inserting a new paragraph after the first sentence: If an Annual Membership fee applies, we will refund this fee if you notify us that you are voluntarily closing your Account within 30 days of the Closing Date of the billing statement on which that fee appears. For cancellations after this 30 day period, the Annual Membership fee is non-refundable. If an Annual Membership fee applies to your Account, it is shown on page 1 and page 2 of Part 1 of the Cardmember Agreement. If your billing address is in the Commonwealth of Massachusetts at the time you close your account, this policy will not apply to you.
Amex clearly isn’t happy with people getting all the MR points and airline credits and then canceling the cards.There were many reports of this happening, lots of them early this year, when people signed up for the Platinum card and received two airline credits along with the sign up bonus, and then canceled the card. This method would save you about $200-$300 but the risk is that it might sever your relationship with Amex.
Also read about recent reports of Amex clawing back points for the 100K MR bonus on the personal Platinum card. Some data points from who had their points taken away, also involved them canceling the card for a prorated refund. Amex will even claw back points after you’ve used them, possibly giving you a negative points balance.
I value my relationship with Amex. I’ve been a cardmember since 2004. So I try to do my best to keep that relationship pleasant while trying to maximize my profits through churning. I always keep my cards through the first year and then cancel within 30 days after the annual fee hits if I don’t plan to keep the card. It certainly looks much better than getting everything possible from Amex and canceling right away.
Whether you keep the card or not, that will ultimately be your own decision, based on what you can afford and on how much value you can get out of the card during that first year. If you do decide to close any Amex cards, do so before September 1st.