Only 35 percent say they are very satisfied with their annual fee
credit cards; 37 percent report closing a credit card because of its
annual fee
RIVERWOODS, Ill.–(BUSINESS WIRE)–A new survey from Discover suggests that paying an annual fee on a
credit card does not always guarantee satisfaction with it. The
collected data showed that 70 percent of consumers are very satisfied
with their credit cards with no annual fee, while in contrast, only 35
percent of respondents said they are equally satisfied with their credit
cards that require an annual fee.
The survey found that 66 percent of consumers said a credit card’s
annual fee factors into their selection of it, and similarly, 60 percent
said having no annual fee is a very important factor when they choose a
card. Most people who pay an annual fee reported paying between $51-100.
Among consumers actively considering switching credit cards, the number
one reason – 54 percent – is to avoid paying the annual fee. Older
consumers are more likely to consider switching to a new credit card
because they do not want to pay the annual fee – 78 percent of
pre-boomers, 67 percent of baby boomers and 58 percent of Gen X,
compared to 46 percent of millennials and 41 percent of post-millennials.
“Our survey found that the most popular benefits for paying an annual
fee are to receive cash-back rewards (52 percent) and travel
benefits/rewards (48 percent),” said Andrew Hopkins, senior vice
president of marketing at Discover. “We don’t think our cardmembers
should have to pay a fee to get great perks, which is why we provide a
full suite of credit cards with a variety of benefits, all without
annual fees.”1
When it comes to paying annual fees, younger generations are more likely
to participate, as 59 percent of post-millennials and 52 percent of
millennials have a credit card with an annual fee, compared to 47
percent of Gen X, 43 percent of pre-boomers and 41 percent of baby
boomers.
Thirty-seven percent of overall respondents said they have closed a
credit card due to the annual fee, and about one-third, 32 percent, said
their one-year anniversary with the card is typically when they regret
paying the annual fee.
“The twelve month mark seems to be a crucial moment in time for the
relationship between many of the surveyed cardmembers and their credit
cards,” said Hopkins. “One year usually gives cardmembers a good ‘test
drive’ period with their card, when they can get a sense of their card’s
benefits and features. For new Discover card members, it’s also a time
when they see their Cashback Match; when we automatically match all the
cash back they have earned at the end of their first year.”2
About the Survey
All figures, unless otherwise stated, are from a Dynata (formerly
Research Now/SSI) survey conducted on behalf of Discover Financial
Services. The survey was conducted online; fielding from February 12-17,
2019 with a total sample size of 1500 US adults (ages 18+), including 96
post-millennials (18-21), 421 millennials (22-36), 461 Gen X (37-52),
393 baby boomers (53-71), and 129 pre-boomers (72+). The figures have
been weighted and are representative of all U.S. adults. The maximum
margin of sampling error was ±2.53 percentage points with a 95 percent
level of confidence.
About Discover
Discover Financial Services (NYSE: DFS) is a direct banking and payment
services company with one of the most recognized brands in U.S.
financial services. Since its inception in 1986, the company has become
one of the largest card issuers in the United States. The company issues
the Discover card, America’s cash rewards pioneer, and offers private
student loans, personal loans, home equity loans, checking and savings
accounts and certificates of deposit through its direct banking
business. It operates the Discover Global Network comprised of Discover
Network, with millions of merchant and cash access locations; PULSE, one
of the nation’s leading ATM/debit networks; and Diners Club
International, a global payments network with acceptance around the
world. For more information, visit www.discover.com/company.
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1 Discover Credit Cards: 0%-25.24% intro APR for purchases
for 6-14 months and 0%-10.99% for balance transfers for 6-18 months,
then variable 14.24% – 25.24%. Cash advance APR variable 27.24%. Pricing
as of May 2019 and is subject to change. Call 1-800-DISCOVER or visit
Discover.com for details about credit costs & terms.
2 Cashback Match: After the first 12 consecutive billing
periods that your new account is open, we will match all of the cash
back rewards you’ve earned and apply them to your account in the
following one or two billing periods. This promotional offer may not be
offered in the future. See Discover.com to learn more.
Contacts
Media Contact
Derek Cuculich
224-405-0665
[email protected]
@Discover_News
