How to Avoid Unnecessary Credit Card Fees

Credit cardholders have the responsibility to abide by the Issuer’s Terms and Conditions. Once you signed the contract, you become accountable for all the possible fees you may incur with your credit card transactions.

If you have a credit card for students, you can significantly cut back your costs by avoiding unnecessary charges. Why should you pay more when you can pay much less? The trick is to be aware of your credit card fees and to eliminate every possible fee that you can.

Let’s check out the most common student credit cards fees that you can steer clear of:

Late penalty. Late fees can range from $15 to $39 while bad credit credit cards start at $20 penalty. Do your best to make your payment before your due date and put that $15 to $39 in your savings.

Over-the-limit fee. Exceeding your credit limit could mean paying an extra $15 to $39, depending on the type of card. Along with the extra charge, exceeding your credit limit can also cause a mark down your credit rating. To be safe, don’t spend more than 50% of their available credit. Keep your spending minimal.

Annual Fee. Annual fees can range from $50 to $85. Some Issuers even charge $90 up to $125 yearly just to keep your account active. Imagine how much you can save by getting a credit card with no annual fee.

Cash Advance Fee. If you use your credit card to get cash from the ATM, you instantly incur an extra $5 to $20 for each cash advance transaction. That plus the cash advance interest rate which can range from 15% to 19%, depending on your card.

International Purchase Fee. Do you plan to use your card credit on your travels? If yes, watch out for International Purchase Fees or Foreign Currency Conversion costs which can add up 3% more for every purchase.

Interest Rates. Some cards charge three different interest rates- one on Purchases, another for Balance Transfers and a different rate for Cash Advance transactions. The interest rate on purchases can be avoided if you can pay off your entire balance for the month. Carrying a balance means paying the additional APR. Also, Cash Advance Rates can sometimes be more expensive than the other rates. This is why cardholders are not encouraged to borrow cash from their credit cards.

About the Author

Samantha Wilson is a consultant for credit cards for students. For years she has written student credit card articles that would help build student credit.

Copyright 2010

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