Credit card companies charge fees of some sort or another. The key is to find a card with the lowest fees for the services you use. For instance, if you use cash advances, then investigate those fees with credit card companies before you sign up with them. Upfront Fees Not every credit card program has upfront fees, so it pays to shop around for the right card. For instance, annual fees are common on cards with fixed or low rates. In the right circumstance, this fee with the right rate can save you money. You will also find cash advance fees, either a flat rate or percentage. Not all cards charge this, but usually they have higher APRs. It is important to read the terms if you plan on using this feature. Balance-transfer fees also can be charged, usually when you use a check sent by the credit card company. Some programs offer no fees or low rates for transfers, especially with an introductory offer. Extra Fees Extra fees can often be avoid but should still be researched. Late payment, over-the-credit-limit, or credit increase can all result in extra dollars. Less common are set-up, return item, or telephone ordering fees. Unless a card is offering an exceptional rate, these types of programs should be avoided. Low Fees Equal High Rates - Sometimes While no one wants to pay fees, sometimes they can save you money. With large balances or balance transfers, you can often find lower rates by paying a small fee. You may also find that with incentive programs, a monthly fee will still allow you to come out ahead. However, for those that pay off their balances every month, choose a card with no or low fees. You can also choose to have a couple of different types of credit card programs to meet your different financing needs. Research Fees Under federal law, credit card companies are required to list fees and APRs before you apply. Often the information will be present in a table. It will include annual, minimum finance, cash advance transaction, transfer, late payment, and over-the-credit-limit fees. With this information, you can decide what card is best for you. |
