Why You Should Consider Downgrading Your Credit Card (and How to Do It the Right Way)

Why You Should Consider Downgrading Your Credit Card (and How to Do It the Right Way)

If you're deep in the credit card points game—or just starting to get the hang of it—you may have heard that downgrading a credit card can be a smart move. But what does that really mean, and why would anyone want to downgrade a card they once worked so hard to get?

Let’s break it down in simple terms.

What Does "Downgrading" a Credit Card Mean?

When you downgrade a card, you’re essentially switching from a card with a higher annual fee to one in the same family with a lower (or no) annual fee—without closing the account.

Think of it as trading in your luxury SUV for a more fuel-efficient version. You’re still driving the same brand, just in a different trim.

Example:
You might downgrade a Chase Sapphire Preferred ($95 annual fee) to the Chase Freedom (no annual fee).

Why Would You Downgrade a Card?

There are two big reasons:

1. To Avoid the Annual Fee

Maybe you're not using the card as much anymore. Rather than canceling and losing the credit history (which can hurt your credit score), you can keep the account open and ditch the fee.

2. To Become Eligible for Another Sign-Up Bonus

Most major issuers (like Chase and Amex) have rules about getting a welcome offer more than once. But here's the good news: If you downgrade and wait the required time, you may be able to reapply for the original card again—and earn that juicy bonus again.

For example:

• Chase only allows you to get a Sapphire bonus once every 48 months.

• But you can only have one Sapphire card at a time.

So, if you downgrade your Sapphire Preferred to a no-fee Sapphire card, and it’s been over 48 months since your last bonus... you can apply again and earn a fresh 60,000–100,000 point bonus!

Before You Downgrade, Consider This:

• Wait until your annual fee posts (so you’ve gotten full value) but call within 30 days of it hitting your statement. Many issuers will refund it if you downgrade promptly.

• Check the downgrade options. Not all cards have a lower-tier version available.

• Do NOT downgrade a card you opened in the last 12 months if you earned a sign-up bonus—this can get you flagged for gaming the system.

Need help figuring out what downgrade paths are available for your card?
Doctor of Credit has a fantastic guide that breaks down downgrade rules and options by issuer (Chase, Amex, Citi, and more). I highly recommend bookmarking it!

📞 How to Downgrade Your Credit Card (Step-by-Step)

1. Call the number on the back of your card.

2. Say you’d like to downgrade to a no-fee version.

3. Confirm whether your points or rewards will transfer or if you should redeem them first.

4. Make sure your account number stays the same (this helps preserve your credit age).

Pro Tips from Miles Mindset

• Downgrading is a smart long-term play. It helps preserve your credit score and keeps you in line for future bonuses.

• Don’t just close a card to avoid the fee—strategically downgrade instead.

• Keep track of the dates: when you got the bonus, when you last downgraded, and when you’ll be eligible again.

 Final Thoughts

Downgrading is one of those behind-the-scenes moves that helps seasoned travel hackers stay in the game longer—earning more points, saving on fees, and keeping their credit profile healthy.

Not sure which card to downgrade or when?

Reach out or join the Miles Mindset email list—we’ll help you create a game plan tailored to your wallet and travel dreams.