Credit cards are pretty much a way of life these days, even if you don’t carry a balance. However, there are quite a few traps to watch out for.
One of the big ones to watch out for is the presence of hidden fees. Things such as annual fees are pretty easy to spot, but other fees are not so well known. However, even annual fees can be a bit stealthy. Some credit cards do not have an annual fee if you make a certain number of purchases each year, but if you don’t use it enough you get charged! Obviously, these cards are not best kept strictly for emergencies and should be kept only if you plan on using them regularly.
Do you like to pay your credit card over the phone, or even check your balance over the phone? There may be a fee for that. There are times when taking care of your credit card over the phone is the best way to handle it, but if there is a fee charged for such convenience it is something you would not want to do regularly.
Many companies allow you to pay your card, check your balance and so forth online. This is very often a free service, but not always! Watch out for any fees charged for accessing your account online.
A very common fee is the late payment fee. However, this is not the worst of it if you pay your credit card late. Odds are that you will get hit with higher interest rates too, sometimes much, much higher - 29% or so! Some companies are now skipping the late payment fee, but you still get hit with the outrageously higher interest rate, so be very careful to pay your card on time.
Now, if you do not regularly pay late, you can sometimes get the fee waived and/or your interest rate brought back to its previous level. Don’t expect this to happen more than once, but it is definitely worth the call if you pay just a tiny bit late.
Many credit cards will let you get a cash advance, but there is a fee for this convenience too. In addition, cash advances often start charging interest immediately, while purchases may wait until the end of the billing period.
Credit cards are tremendously convenient, but they can also be a trap. Pay careful attention to the various fees you might be charged to limit your unexpected expenses.
Know Your
Credit Cards