We should all acknowledge the fact that the 0%-interest rate imposed on many credit cards today doesn’t last. Once the teaser or introductory period ends, you should expect the interest rate to suddenly rise and the fees applied to your transactions to re-appear.
This is the main reason why you should never evaluate a credit card offer based on the introductory features alone. Instead, you should pay close attention to what’s in store for credit card applicants, like you, beyond the teaser period. To succeed in this matter, we suggest you seriously consider the following fees and charges:
The annual fee is what you are required to pay every year to activate your card. Some credit cards require a low $15 annual fee to a high of $100 per year. Usually, credit cards with reward programs impose higher annual fees to make up for the incentives they give. The best low interest credit card you can get is one that has no annual fee so you won’t have to worry about a yearly payment at all. If you have a credit card with a high annual fee don’t despair. If you call your credit card company and ask them to remove the fee, many of them will. If they won’t, I’ve found that acting like I will transfer my balances elsewhere often motivates them to remove the charge. This only works if you are a good payer and tends to work only once.
Minimum Finance Charge.
This is the minimum payment you need to submit at the end of your billing cycle regardless of how much your balance is. Some credit card holders pay only the minimum each month but doing so puts you at risk of mounting credit card debts and interest rates. The best way to manage your credit card balance is to pay it in full, or to pay as much as possible. If you must carry over a balance, pay more than the minimum so you can get out from under your debt as soon as possible.
Balance Transfer Fees.
If you’re going to use your credit card for transferring your high rate credit card balances, check out the balance transfer fees. Usually, the balance transfer fee will depend on the amount you are going to transfer. Although the interest rate is zero, you may be charged a considerable fee every time you make a transfer.
Late Payment Fee.
Obviously, you will be charged with this fee if you delay with your payment. Credit cards with zero interest offer are particularly very strict about payment dues. You can get charged with an expensive late penalty fee and even get disqualified from zero interest offer if you made a single late payment.
Credit Limit Fee.
This is your penalty is you exceed you’re allowed credit limit. Naturally, you want to avoid exceeding your credit line altogether not only to avoid this fee, but also to protect your credit history and credit score.
If you travel a lot, you need to be aware of the conversion fees on your credit card. You may be surprised at how much you can be charged from transaction fees alone if you use your credit card in other countries. These fees can also apply when you use your credit card for shopping online and the merchant’s processor is located outside of the US so watch out!