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      October 15, 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

 

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TopConsumerReviews.com 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.

Credit cards are hiking rates, but cutting fees

Other findings from the CreditCards.com's research: One card -- PenFed's Promise Visa -- charges no fees at ... plus a $75 annual fee and a $6.25 monthly fee. Why would anyone get that card Perhaps t...

Published:  Tue, 09 Oct 2018 19:31:49 GMT



The Worst Credit Cards for Fees in 2018, Plus One No-Fee Credit Card

Credit card interest rates are on the rise ... (11.49%-17.99%), making it appealing to those who want to avoid the risk of extra charges. There's no annual fee, and you won't pay extra for balance tra...

Published:  Tue, 09 Oct 2018 13:19:00 GMT



Hilton Credit Cards: Which One Should You Get

For Hilton enthusiasts, co-branded credit card options abound ... The more expensive cards come packed with rich benefits and rewards, while the no-annual-fee card comes with fewer side perks. That ra...

Published:  Fri, 12 Oct 2018 12:23:00 GMT



Credit Card Survey Shows 'Dramatically' Higher APRs, Fewer Fees In 2018

the Capital One Platinum Credit Card and the Capital One Secured Mastercard, according to CreditCards.com. Based on the report, users are encouraged to choose only no-annual-fee cards, to stay on ...

Published:  Fri, 12 Oct 2018 08:23:00 GMT



Credit card gas rewards fuel bigger savings at gas pump. Here's how to take advantage

Look for credit cards that offer bonus rewards on not only gas but other ... Example: The PenFed Platinum Rewards Visa Signature Card, with no annual fee, offers a generous 5 points per dollar spent, ...

Published:  Wed, 10 Oct 2018 07:20:00 GMT



How to choose the correct credit card for you

According to Experian, most Americans shop for credit cards with a similar mindset; 54 percent seek out a card with no annual fee, while 40 percent look for a low-interest rate. It's not all business, ...

Published:  Fri, 12 Oct 2018 05:43:00 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 03:13:00 GMT



Discover Introduces No Annual Fee Business Credit Card with Unlimited 1.5 Percent Cashback Rewards on All Purchases

RIVERWOODS, Ill.--(Business Wire)--Discover today announced the launch of the Discover it ® Business credit card, the latest addition to the Discover it family of credit cards. The new card offers unl...

Published:  Wed, 12 Sep 2018 04:22:00 GMT



Fee-free travel credit cards Yes. They reward frugal travelers but not always loyalty

"We found over a dozen cards from major issuers that have the best of both worlds - no foreign transaction fee and no annual fee," he said. "That's a more recent development in the world of credit car...

Published:  Mon, 21 May 2018 05:12:00 GMT



The Amex Platinum credit card is available to active duty servicemembers at no annual fee - but even with the fee, the card is a great value

The Insider Picks team writes about stuff we think you'll like. Business Insider may receive a commission from The Points Guy Affiliate Network. American Express/Facebook The Platinum Card from Americ...

Published:  Sun, 09 Sep 2018 09:47:00 GMT



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