Credit Cards

6 fees to investigate before signing up for a credit card

Image Source: Getty Images

Don’t be surprised by the costs when you sign up for a card.

Key points

  • If you’re signing up for a new credit card, it’s important to know the details.
  • Specifically, some cards charge fees for certain things, like foreign transactions or even just becoming a customer.
  • It’s important to research all the fees your card may charge before you sign up.

If you’re considering signing up for a credit card, you’ll want to make sure you don’t have any unexpected costs.

Unfortunately, some cards can be more expensive than others and may not justify their prices. You don’t want to end up with one of them, so check out these six rates before you decide if the card in question is right for you.

1. Annual fees

Some cards charge an annual fee just for having the card open. This can range from a relatively affordable annual cost to a fee of hundreds of dollars per year.

You shouldn’t necessarily avoid a credit card just because you have to pay a fee, as there are often generous benefits that make these cards worthwhile. But you’ll want to know the cost up front, figure out how much the fee is worth in relation to the cardholder’s benefits, and make sure it’s worth paying.

2. Foreign transaction fees

If you will be traveling or making purchases from vendors outside of the US with your credit card, you should check to see if there is a foreign transaction fee. If so, this could make your purchases more expensive for no reason, and you should seriously consider looking for a card that doesn’t have this unnecessary extra cost.

3. Interest charges

All credit cards charge interest, but some cards have a higher rate than others. If you expect to carry a balance at any time while the card is open, it’s extremely important to prioritize a low interest rate. In fact, the APR may be more important than any rewards program the card may offer, since the interest charges outweigh the value of the rewards you can earn.

4. Late Fees

Some credit cards charge high fees for late payments. While ideally you should pay your card on time, accidents can happen. Make sure you know how much you’ll be charged if you pay late, and do your best to avoid this by setting up automatic payments of at least the minimum due.

5. Over-Limit Fees

Over the limit fees are also common if you exceed your credit limit. You should try not to come close to this, but instead keep your used credit to no more than 30% of your available credit line. If you exceed this ratio, it could hurt your credit score.

But if you tend to charge a lot on your cards and can get close to the credit limit, you need to be aware of the fees you’d end up paying.

6. Balance Transfer Fees

Finally, if you’re considering transferring a balance from your current credit cards to a new one in order to take advantage of a 0% APR offer, you’ll want to make sure you know what fees the card issuer will charge. .

These fees are often worth paying to get the benefit of a 0% interest rate for months while you work on paying off the debt. But some cards charge lower fees than others, and you’ll want to keep that in mind when deciding which balance transfer offer is best.

By looking at all of these fees, you can choose a card that doesn’t impose a lot of extra costs, and you can be prepared for any expenses you’d incur with the credit card you open to make sure you’re comfortable with those costs.

The best credit card eliminates interest until the end of 2023

If you have credit card debt, transfer it to this top balance transfer card locks you in with a 0% introductory APR through the end of 2023! In addition, you will not pay an annual fee. Those are just some of the reasons why our experts rate this card as one of the best options to help you control your debt. Read the full review of The Ascent free and apply in just 2 minutes.

Related Articles