Credit Cards With No Fees

It hardly needs to be said, the less you have to pay for use your credit card the better. Best still, if you can get credit cards with no fees at all.

But against this, always remember this basic concept: there is no free lunch. The credit card companies are not charitable organizations. They need to make money off you, one way or another. They may offer one incentive or another, but ultimately they have to make a profit off your use of their credit card.

Most card companies charge an annual fee. But to entice new customers, a number of card issuers offer a waiver for the first year.

There are some card issuers, like Discover and Chase, who offer cards without an annual fee charge. Annual fees can range from $20-70$ or thereabouts. So not having to pay an annual fee is a reaonable savings.

But you have to watch out for the other features of the no annual fee card, that may or may not suit you. For example, the interest rate might be higher than a card that charges an annual fee. And the interest you end up paying might be more than the annual fee of another card with a lower interest. So you have to take into account your spending habits and your ability or intention to pay off your monthly balance.

If you are a credit-card holder in good standing, you can even try contacting your credit card company to request that your annual fee be waived. Most card companies have the discretion of doing this, the main consideration being whether it benefits them in the end to act generously with you.

Some seemingly encouraging news has come from the recent announcement by American Express and Discover that they will soon stop the practice of charging a fee when the credit user charges the card in excess of the credit limit.

At present, American Express charges a whopping $35 when the credit limit is exceeded. Instead, each overlimit transaction will be individually reviewed for approval.

This is a response to the Credit Card Accountability, Responsibility and Disclosure Act which restricts overlimit fees.

But it has also announced that it will cancel rewards points on its Blue and Blue Sky cards for any month that the consumer misses a payment. It will charge $29 to reinstate points for each month, if the consumer wishes to get his points back. It has also announced that that rates will be raised for cash advances and for late payment fees.

There have been horror stories of people being charged a late charge, which took their account over the limit, and for that an overlimit charge was further imposed.