Hate the idea of paying a yearly fee for a credit card? You’re not alone. Most banks have a range of cards with $0 annual fees. Of course, the flip side is that those cards might not have a good (or any) rewards program attached, which defeats the purpose of ‘points hacking’.
Luckily, there is a ‘middle ground’ compromise available: certain premium rewards credit cards waive their annual fees for the first year or provide some sort of discount or incentive.
The net effect? You still don’t pay an annual fee for the year, but you could still pocket tens of thousands of frequent flyer points and utilise the card’s rewards for a year. Here is our overview of $0 annual fee credit cards.
What is a $0 annual fee credit card?
As the name implies, a $0 annual fee credit card is one that does not charge a yearly fee to maintain the card. This may be for the life of the card or a limited-time promotion. Either way, if you play your cards right, you can still earn decent rewards while minimising annual fees.
Note that even though a card might not have an annual fee, all other types of fees and interest charges will still apply when applicable, such as late payment fees and the retail or cash advance interest rate.
Why choose a $0 annual fee credit card?
A $0 annual fee credit card helps with budgeting, as you avoid an extra expense that could range from under $100 to more than $1,000 a year (the latter only applies to ultra-high tier cards).
It’s particularly suited for low-income earners and those who don’t spend a lot or who don’t really care about rewards programs and frequent flyer points. But there are options out there that let you enjoy the best of both worlds.
Remember, if you apply for a ‘$0 first year annual fee’ credit card, you will need to cancel the card account before the second year annual fee is due, to avoid paying any charges. Consult with your card issuer if you need to determine when your card anniversary is.
Best ‘$0 first year annual fee’ reward cards
For high sign-up bonuses and better recurring points earning rate, here are some premium rewards credit cards that don’t charge an annual fee for the first year.
Current Offer: No annual fee for the first year, 0% p.a. on Purchases for 7 months and 0% p.a. on Balance Transfers for 22 months.
Rewards Earn Rate: 1 Amplify Point per $1 on eligible purchases
Annual fee: $0 for the first year, $99 p.a. ongoing
Expiry: 30 September 2020
The St.George Amplify Platinum Visa – Amplify Rewards, as well as the Bank of Melbourne and BankSA versions of this card offer an effective points earn rate of 0.5 frequent flyer points per dollar on most of the linked frequent flyer programs to Amplify Rewards, which for an ongoing $99 annual fee card, is respectable.
The strength of Amplify Rewards is its ability to be transferred to multiple rewards partners, offering flexibility in how you redeem your points.
Current Offer: $0 annual fee for the first year and 0% p.a. for 14 months on Balance Transfers
Rewards Earn Rate: $20 Woolworths Shopping Card for every 4,000 Credit Card points
Annual fee: $0 for the first year, $49 p.a. ongoing
You’ll can also enjoy 10% off your grocery shop at Woolworths once a month, subject to the Terms and Conditions, and up to 55 days interest free on eligible purchases.
Best ‘$0 annual fee for life’ reward cards
For peace of mind that you’ll never be charged an annual fee ever, here are reward cards that don’t have any annual fees attached.
Rewards Earn rate: 0.75 Qantas Points per dollar spent on eligible purchases, additional 1 Qantas Point per dollar spent on Qantas products and services in Australia, and 0.5 Qantas Point per dollar on government spend.
Annual fee: $0 p.a. ongoing
This ticks all the boxes — American Express which means premium card service, Qantas Points earning ability, and no annual fee ever. There are also no caps on the earn rate.
Rewards Earn Rate: 1.25 Membership Rewards point per dollar on general spend, and 1 Qantas Point per dollar on government spend.
Annual fee: $0 p.a. ongoing
Another feature-packed $0 annual fee card is the American Express Essential Card, which has no annual fee for life.
Instead of Qantas Points, this card earns Membership Rewards points which are flexible and be transferred to other airline and travel partners.
There’s even a range of insurances included, such as smartphone screen insurance and purchase protection.
Rewards Earn Rate: 1 flybuys point per $2 spent – which can be transferred to Velocity Frequent Flyer or redeemed when you shop at Coles or some other retailers.
Annual fee: $0 p.a. ongoing
It’s written in the name — a Coles rewards credit card with no annual fee. If you accumulate 2,000 flybuys points, that is redeemable for $10 off at the checkout at Coles and some other retailers, or 870 Velocity Points when transferred (this can increase to more than 1,000 points with bonus transfer offers).
The offers displayed on this page are selected from a range of products across pointhacks.com.au as at the time of publishing this article. The use of the terms “Best” is derived from a combination of the highest points offered on sign-up and/or on recurring spend, plus any extra associated card benefits.
What to look for when searching for the best no annual fee frequent flyer credit card?
- Bonus points offer: If you can nab a decent sign-up points bonus with a credit card, then it could make it even more worthwhile. Generally, cards with high sign-up bonuses tend to fall into the ‘$0 annual fee for the first year’ category.
- Earn rates: If you choose a no-annual-fee card with a rewards program, then it’s important to note how many points you can earn per dollar, and what factors might increase or decrease that rate.
- Other card benefits: See if there are any other benefits of a particular card that might suit you, such as included insurances or participation in schemes such as American Express Shop Small.
What to be mindful of with no annual fee frequent flyer credit cards
- How long the card has a $0 annual fee: As we’ve alluded to many times now, some credit cards are annual-fee-free for life. Others, particularly Platinum-level cards, might only waive the annual fee for the first year. In this case, the onus is on you to cancel before the second year if you want to avoid paying fees.
- Interest rate: Rewards cards generally have high interest rates — it’s simply are not designed for carrying a balance over month-to-month. If you have issues with credit card debt, applying for a card with no annual fee might help with your finances, but you’ll still need to pay off interest charges on any debt.
- Hidden fees: If you take up other card benefits such as a balance transfer offer with your card, be sure to know all the associated extra fees which might not be waived — such as balance transfer establishment fees.
What do I need to know before I apply for a no annual fee credit card?
- Am I eligible for the bonus points? Most cards will exclude you from bonus sign-up points if you have held their credit cards in the last 12-18 months. This will be in the terms and conditions.
- Is my credit score healthy? The chances of having your application accepted are much better if you have a good credit history.
- When did I apply for the card? Especially for cards which only waive the annual fee for one year, keeping track of your card anniversary will help you plan when to close the card if needed.
Zero-dollar annual fee credit cards can offer great value for the savvy points hacker, especially cards that has a large sign-up bonus offer and no annual fee for the first year.
There are also cards with no annual fees for life, but still offer rewards programs, particularly through American Express. Browse the full range of cards with no annual fees for life.
We will often have exclusive offers with high sign-up points or no annual fees for the first year, so check back occasionally to see if we have any new deals here.
Frequently asked questions
The following answers are general advice and do not take into account your personal circumstances. Be sure to consider all aspects of a no-annual-fee credit card before applying.
The credit cards listed on this page have no annual fee, which is the lowest you can get.
If your card usually has an annual fee, there are ways you could get it waived. If you’re applying for a new card, check this page for any exclusive offers from Point Hacks, including waived first-year annual fees. If you have an existing card, give your card issuer a call to discuss options.
Certainly, you can cancel a credit card any time (although outstanding debts still need to be paid). For ‘$0 first year annual fee’ promotions, you should cancel your card before the second year annual fee kicks in, to avoid being charged any annual fees.
The best no-annual-fee credit card depends on your needs. Some don’t have an annual fee for life but features a smaller rewards program, while others are fee-free for the first year only, but with much bigger rewards.
It depends on your needs. If you want to save on fees while still wanting to earn some rewards, then one of the no-annual-fee credit cards listed on this page could be right for you.