I just cancelled my United Chase credit card and saved $60 in annual fees. Not bad for about 20 minutes work, which involved calling the credit company and moving some automatic payments to my AMEX-Costco Cash card which has no annual fee. I had had the United chase card for about 3 years, primarily for the United mileage plus points which were useful as I travelled a lot. However as my travel requirements reduced and with my current cards 5% cash reward program, the reward miles were not really worth the annual fee (plus I really don't like flying United anymore). I should have cancelled the card last year, but like a lot of people I got lazy and just kept the card. It is only after the annual fee is charged that I was reminded about it and wished I had cancelled. This year, as I got my finances in order, I was more proactive and cancelled the card before the annual fee hit.

This got me thinking that unless you really want an exclusive card with special rewards or features, it really is a waste of money to pay annual fees on credit cards. Taking the example of my AMEX-Costco Card, I get up to 3% cash back with it, which in the long run is much better than mileage rewards that are specific to an airline and hard to redeem in today's aviation market. Also if I really wanted the airline points, there are a number of credit cards with no annual fees that offer airline reward programs standard.

So review your credit cards and where possible get rid of those that charge an annual fee. With fees ranging from $50 - $500, this could save you a fair chunk of change.