Keep an Eye on These Credit Card Fees

What do you pay the most attention to when comparing credit card offers? Do you realize there is more to think about than a low interest rate and powerful rewards program?

Before applying for any credit card offer, it’s important to answer this question: what fees are associated with the card?

If you don’t answer this question upfront, you could be in for a big surprise in the future.

Here are several fees that could come into play at some point:

• Annual fee. This is nothing more than a fee you pay once a year for simply carrying your credit card. It may not be fair, but it’s something that many people pay without hesitation. Fortunately, there are plenty of zero annual fee credit cards out there.
• Balance transfer fee. Do you want to transfer a balance from one credit card to another? Doing so will set you back a few dollars, typically three to five percent of the amount you are transferring.
• Cash advance fee. It may sound like a great idea to request a cash advance, but it will come at a cost. Most credit cards have a cash advance fee of two to five percent of the amount you borrow.
• Finance charge. If you carry a balance from one month to the next, you will more than likely pay a finance charge (unless you’re in a zero percent interest period). You should always search for a credit card with the idea that you want to secure the lowest possible finance charge. Even if you don’t have plans of carrying over a balance, you know this could happen at some point.
• Foreign transaction fee. It’s not a big deal to everyone, but some people regularly travel out of the country. If you use your credit card outside of the United States, you may incur a fee of somewhere between one to three percent of the purchase amount.
• Late payment fee. Just because you know when your credit card bill is due doesn’t mean you will actually pay on time. It’s possible that this could slip your mind for some reason. If it does, there’s a good chance that a late payment fee will be applied to your account. Just how much depends on your actual credit card.

Tip: while there is no avoiding some of these fees, others can be dealt with by contacting your credit card company.

For example, if you are charged a late payment fee, don’t hesitate to contact your company and ask if they can waive it. If you have a long history of paying on time, there’s a good chance they will comply with your request.

Generally speaking, all of these credit card fees can be avoided. This is why you want to learn more about each one before applying.

Do you carry at least one credit card? Have you ever been charged a fee? Is there anything you do to avoid paying fees? Share your personal guidance in the comment section below.