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Common Credit Card Fees
14 Aug 2019

A Quick Guide to the Most Common Credit Card Fees and Charges

Credit cards provide a wide plethora of financial benefits and options within reach. This holds true as there are over 469 million credit card accounts in the US, meaning that the average American has at least one credit card.

But owning a credit card also comes with responsibilities and conditions. Credit cards also come with fees that can take you by surprise if you are not careful.

There are different kinds of credit cards that charge all sorts of fees. The good news is you can avoid many of them. Here are some of these common credit card fees you might encounter:

1. Annual Fee

One of the common credit card fees you’ll encounter is the annual fee. Deriving from the name, it pertains to a yearly fee charged from owning the card.

While not all credit cards have this fee included, secured ones often do. Annual fees are also present in some premium cards, charge cards, and subprime credit cards.

As for the amount of the charge fee, it can range from $19 to as much as $500. This also depends on the credit card. Despite the fee, some cards have benefits to counterbalance this charge.

Another thing of note, some credit cards also tend to waive the fee for the first year. This allows you to enjoy the benefits before they make you pay.

2. Cash Advance Fee

This particular fee comes up whenever you make a cash advance or an equivalent transaction such as overdraft protection.

When it comes to the amount, it often runs at 5% of the withdrawn amount or a flat $10. In this case, it takes whichever is higher between the two. The best way to avoid this fee is by avoiding cash advance transactions altogether.

3. Balance Transfer Fee

Some credit cards charge whenever you transfer balances. The amount charged is at 3-5% of the amount going to the credit card.

There are a few credit cards that don’t have balance transfer fees. For example, the AmEx Everyday Credit Card and the PenFed Promise Visa Card do not have these. This is a case where you have to review each credit card before signing up.

Check out our credit card reviews for more information.

4. Foreign Transaction Fee

This fee pops up when you make a purchase in a foreign currency. Credit cards that have this fee charge 3% of the transaction amount.

Keep this in mind if you are out of the country. If you plan to avoid this fee while you make your purchase, consider getting a credit card with flexible terms regarding foreign currency. There’s always the option to use cash for the transaction instead.

5. Late Fee

Did you miss your minimum payment? If you did, this credit card fee will appear and haunt you until you pay.

In the event of a late fee, the first offense charges a small amount. This increases with each month you delay payments. This fee gets charged once per billing cycle that you are late.

Pay on time. If you think you’ll experience difficulty paying on time, contact your credit card provider ahead of time and negotiate.

Know These Common Credit Card Fees to Be Ready!

These common credit card fees would appear along with a few others. Some of these have conditions for charging you for the transactions to take. Once you know how they operate, you can find ways to avoid them and circumvent the situation.

When it comes to financial solutions, we have the means to help you out. For inquiries, you can contact us today to get started.