Back in 2016, American Express stopped prorating the annual fee when you cancel a card in middle of the card-year. Product changes, however, still get the fee prorated. This leaves the option of downgrading a card no longer needed in order to get the desired prorate.
I recently noticed an interesting discrepancy between upgrading an Amex card versus downgrading. When upgrading a Green card to Platinum last year, Amex did not process the prorate until my renewal date a few weeks later, so as to round off the Platinum cost into monthly fee blocks.
For example, the personal Platinum card annual fee is $550, which breaks down to $45.83 per month. When upgrading to the Platinum card, they’ll wait until the date in the month when your annual fee was changed, and then prorate the fee monthly. If there are 2.5 months left to the year, they’ll wait until the 2-month mark, and charge you $91.66 (two months @ $45.83 per month). [At the same time, they’ll give you a prorated refund for the 2 months remaining on the Green card. The annual fee there is $95, so you’ll get $15.82 (2 x $7.91) back.]
The product change will process immediately, and you’ll get a mail confirming of the change occurring on the date you called in, but there’s no extra charge for that half-month, just the regular Green cost you were paying until now.
Conversely, when I recently downgraded a Platinum card to Green, I got a prorate for the rest of the year to the day. On my Amex statement, it shows the prorate based on the exact day I called in to downgrade the card. [At the same time, the prorated fee on the Green card posted to my Amex account, charging me for the rest of the year from that day forward.]
In the case of the upgrade, Amex rounds everything off to the coming month, whereas in the case in the downgrade, they’ll give you back credit to the day. This creates a bit of an opportunity to ‘hack’ a month of extra Platinum (or other card) with no fee if you are going through with an upgrade: time your upgrade to be one day after your renewal date-of-the-month to do the upgrade.
For example, if you were charged an annual fee on a Green card on February 10th, and it’s now September 4th and you want to upgrade the Green to Platinum, wait until September 11th to process the upgrade and you’ll save yourself almost $40 since you’ll get all Platinum benefits immediately, but you won’t pay any Platinum fee until October 10th. Hopefully this makes sense.
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