Common Credit Card Fees
Carrying a credit card comes with a lot of responsibility. Before you apply for a card, no matter which one it is, you should find out which fees you may face in the future. Simply put, you don’t want to deal with credit card fees unless it is absolutely necessary. And even then you may want to think twice about what you are doing. Remember, using your credit card and paying interest (in some cases) should be enough for the credit card company. You do not need to be giving them extra money in fees along the way.
The most common type of credit card fee is known as an annual fee. Fortunately, not every card has one of these. Simply put, an annual fee is an amount you pay every year for carrying a particular credit card. Believe it or not, this fee can range from $25 on the low end to $300 on the high end. If you don’t want to pay an annual fee you should not apply for a card that has one. It can be a pain to negotiate your way out of this fee.
What about balance transfer fees? Many people take advantage of balance transfers so they can pay less in interest. But before you do this you need to know that you may be paying a fee for doing so. In most cases, a balance transfer fee is approximately 1 to 3 percent of the amount transferred. For example, if you transfer a balance of $10k with a fee of 1 percent you will owe your credit card company $100.
A few other common credit card fees include: application fee, cash advance fee, late fee, over limit fee, and of course, finance charges.
It is very important to know which fees are associated with your credit card. And if you are applying for a new card be sure to avoid those that have many fees attached to them; they probably aren’t worth your time (or money).
