Best No Annual Fee Credit Cards
      December 13, 2018

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Credit Card Fees

The No Annual Fee Credit Card Advantage

When a No Annual Fee Credit Card Doesn't Save You Money


Top Consumer Reviews Articles provides unique articles that you won't find anywhere else on the internet. These articles are designed to help you make the most informed decisions possible.

When a No Annual Fee Credit Card Doesn’t Save you Money

When the government placed heavy restrictions on credit card policies in 2009, an effort to better protect the consumer financially, credit card companies had to become more creative in making their money. The days of double fees, underage clients, and unfair interest rate increases were over for them. But, new, less obvious methods of making back that lost revenue evolved.

Today there are a number of reasons why a credit card company will not charge an annual fee but most often it's used to draw in a customer. Annual fees are often waved for the first year or longer and credit card companies make every effort to make that back as quickly as possible. Below are several ways credit card companies work to draw you in and then make money off your business:

  • Interest rates. Most no annual fee credit cards have at least a slightly or significantly higher interest rates. This is one common method of earning back the cost of the waived annual fee. This is fine for those that never carry a balance and feel confident enough they will never have to. However, if you do tend to hold a balance from month-to-month you'll want to closely consider the annual interest rate and how much it will cost you to maintain your balance over time. If your balance is so large that the interest you accrue over the course of a year would be larger than the annual fee, you might want to opt for a card that will save you over all.
  • New Fees. Consumers should be on the lookout for additional fees not legally restricted by the Credit Card act of 2009. Perhaps all of them have not yet been identified but activation and application fees are some that we can think of. Reading the fine print of your credit card agreement will probably either give you a headache or put you to sleep but it's important in identifying any fees that you will be charged.
  • No annual fee offers might not last. Some no annual fee credit cards wave the fee only in that first year. When consumers are quick to avoid reading the fine print they are often shocked, the next year, when a hefty, say, $200 annual fee hits their account unexpectedly. This is a clear example of when a waived annual fee is not a good option.
  • Enticing offers. All of us like to receive something that feels free. No annual fees, cash back and reward credit cards are all very enticing. When a consumer chooses a no annual fee card with rewards programs, that encourage them to spend more than they can afford or quickly pay off, then the credit card is not a good savings opportunity.

Any time you're opening a new credit card account, you should look at several offers and do the math on which one is the best for your spending needs. If you plan on maintaining a bigger balance you may save money with a credit card that charges a small annual fee but offers a lower fixed interest rate.

Discover's no-fee travel credit card matches all of your miles in the first year for an unbeatable 3% across the board

For those who enjoy centralizing purchases to one card, a 3% back shopping spree for 12 months could be a great deal, especially as there is no annual fee, and 0% APR for the first 14 months; then a v...

Published:  Tue, 11 Dec 2018 08:13:00 GMT

Virgin No Annual Fee Credit Card - Rates and Fees

Enjoy a balance transfer offer for up to 36 months and $0 ever with the Virgin Money No Annual Fee Card. The Virgin No Annual Fee Credit Card offers a variety of valuable features without the cost of ...

Published:  Wed, 28 Nov 2018 21:47:00 GMT

Kiplinger's Personal Finance: Getting the most from your credit card

Whether you're a big spender, a traveler or a foodie, here are the best rewards credit cards for you: Cash back with no annual fee: The Citi Double Cash Mastercard is a solid choice for all types of s...

Published:  Sat, 08 Dec 2018 23:39:00 GMT

The Best Business Credit Cards With No Annual Fee

Business credit cards are popular tools for people who need to separate their business and personal expenses. Some business credit cards offer amazing benefits for business travelers but carry big ann...

Published:  Sun, 18 Nov 2018 16:00:00 GMT

This Credit Card Has No Annual Fee and Gives 3% Cash Back on Dining. Here's Why It's the Best of 2018

For a lot of people out there, the idea of paying an annual fee just to be allowed to spend money seems absurd. While annual fee credit cards can be cost-effective, we know there are plenty of you who ...

Published:  Mon, 24 Sep 2018 03:16:00 GMT

When to Renew a Credit Card With a High Fee

High-fee, premium credit cards give cardholders plenty of benefits, including lounge access, travel stipends and deals on flights and hotels, in some cases. But how do you know when a $500-plus annual ...

Published:  Mon, 05 Nov 2018 17:32:00 GMT

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