5 credit card fees you shouldn't pay

Not every card issuer will ding you for using your card overseas or taking advantage of a 0% balance transfer offer. And that is why learning to play your cards right is so valuable.

By MSN Money Partner May 17, 2013 12:05PM
This post comes from Jason Steele at partner site Credit.com.

Credit.com logoMark Twain once said “Everybody talks about the weather, but nobody does anything about it.” But when it comes to credit card fees, there is actually a lot that credit card users can do to reduce or eliminate them. In fact, conscientious cardholders can avoid paying these fees altogether when they choose the right cards and use them wisely.

Credit card © Fancy, Veer, Corbis, CorbisHere are the top five credit card fees, and how to avoid them.

1. Annual fee. It is true that many credit card issuers now charge an annual fee, but there are still plenty of free products available. And even when a card does have an annual fee, there are ways to avoid paying it.

2. Foreign transaction fees. Of all the credit card fees, this might be among the more controversial ones. Credit card issuers exchange currency at the interbank exchange rate, which is the best possible rate. And actually, they impose these charges on any transaction processed outside the U.S., even if it’s in U.S. dollars.

Nevertheless, most banks tack on a 3% foreign transaction fee to all of these charges. Thankfully there are now many cards without this fee, and several banks that never charge it. For example, Capital One, Discover, and the Pentagon Federal Credit Union (PenFed) have eliminated this fee on all of their products. All you need is just one of these cards to use in foreign countries, and you are good to go.

3. Late fees. In most cases, cardholders must take responsibility to make their payments on time in order to avoid this fee. Setting up automatic payments makes it impossible to forget a payment while paying electronically avoids the risk of having a check lost in the mail. In addition, there are a few cards that boast of no late payment fees. But be careful, it is important to know that interest continues to accrue, your late payment will be reported to credit bureaus and it could trigger a higher interest rate.

4. Cash advance fees. Most cards have a cash advance fee of 3% with a minimum of $5 or $10. And beyond cash advance fees, a higher APR will be charged on the cash withdrawal, and there is no grace period. To avoid paying this fee, never use a credit card for a cash advance. In fact, it is best to avoid this possibility by not creating a PIN code with your credit card.

5. Balance transfer fee. Most credit cards that feature 0% APR promotional financing on cash advances also have a 3% balance transfer fee. There are two ways to avoid this fee.

First, consider the Chase Slate, the only card from a major issuer that has a promotional balance transfer offer and no balance transfer fee. But most of these offers also feature interest-free financing on new purchases. If you absolutely must finance a purchases with a credit card, use a 0% offer on new purchases before you do, and not a balance transfer offer afterwards.

Credit card fees may always be with us, but we don’t have to pay them. By taking the right steps to avoid paying unnecessary fees, you can enjoy these powerful financial instruments for free.

More from Credit.com:


May 18, 2013 3:47AM
Screw the banks and their credit cards.
I refuse to be enslaved.
May 18, 2013 10:44AM
I only use my Sam's Club Discover Card.  No annual fee and since I pay balance every month, no interest.  I get back $300-$500 from them every February so why not use it.
May 18, 2013 12:17PM
The only card you need is your bank card. Here's a novel idea... If you can't afford it-Don't buy it! 
May 18, 2013 12:29PM

Having a wallet full of credit cards makes me feel

as if I were walking through gang territory at midnight.

May 18, 2013 2:30PM

1. Annual fee. It is true that many credit card issuers now charge an annual fee, but there are still plenty of free products available. And even when a card does have an annual fee, there are ways to avoid paying it.


Well, what are the ways to avoid paying the credit card annual fee

May 18, 2013 11:58AM

Our state ...IL...now gives you your tax refund on a debit card that has fees attached if you are not careful and do not read the very very  fine print from chase. Also you cannot refill that card when it is out of funds you throw it away. With all the paper they used, the plastic, the phone call to activate, me bitchin about it, it would have been better/easier/cheaper to have gotten a check. But then chase would have lost an opportunity to try to screw me out of my money.

May 18, 2013 12:02PM

The author of this article is a retard. He says in order to avoid a cash advance fee, don't get a cash advance. DUH!!!!!


His advice is the same as you telling your doctor, "Doc, it hurts when I walk", and the doctor replies, "then don't walk". STUPID!! I don't need an expert to tell me this.


The title of the artile implied he would tell us how to do these things without incurring a fee. What a waste of time!



May 18, 2013 12:06PM
One of the problems I find is that Bank of America imposes this Foreign Transaction fee, but based on my experience, you don't know if your on-line purchase is with s foreign or domestic firm.
May 18, 2013 2:33PM

Sorry, it was a question. I forgot the question mark!

Well, what are the ways to avoid paying the credit card annual fee?

May 18, 2013 1:49PM
Chase may be the only card to initially offer no transfer fee, but they may get you in the end so don't be fooled.  They may start with a low interest rate then hit you with a large rate increase despite you paying on time and paying more than what's due.  They did this when they took over the Washington Mutual accounts and all accounts' interest rates were more than doubled.  If you use their card and your interest inflates more than 100%, just close the account, do not charge anything else on it, and pay it off at the low interest rate.
May 18, 2013 4:36PM
Another fee you shouldn't have to pay is a late fee when you pay it on the day due.  The banks put time line on when the payment needs to be ion the date due..  i always though a date was from midnight to midnight so why should we have to pay a late fee because it's not paid by 5 PM.  Modern technology is able to put the payment in the computer and send you a payment received so you should not have to pay any fee at all.  It's just another way for them to make more money and not gave two cents about us consumers who put them in business in the first place.
May 18, 2013 3:01PM
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