29th May 2009
Annual Fees And Their Affiliation With Credit Cards
No one wants to pay more than they have to on their credit debt, so finding new ways to cut back on costs is a reasonable idea. One method of cutting back these costs is to waive the annual fee that some lenders or creditors charge. It’s not always viable, but well worth the trouble.
Annual fees aren’t a great amount- sometimes as cheap as $45 or less. You wouldn’t necessarily turn down a credit card based on this alone, but when you put it into perspective it seems more unfair. By spending $300 a year on your credit card, about 15% of that total is going to the annual fee- and that isn’t counting interest! Credit card annual fees don’t seem so innocent or inexpensive now, do they?
So we have proven annual fees can be costly. So why do we pay them? One reason is that the borrower doesn’t have a great credit history. Lenders will use the “Your credit isn’t good enough” excuse to help milk more money out of your bank account when they can. Sadly your only way out of this mess is to increase your credit rating or find a new lender.
Credit companies are always looking for ways to entice new customers. One method has been to offer rewards for using the credit card. Such credit cards are commonly laden with annual fees, so as to help pay for the rewards the customer is getting. If you plan on using the credit card to a great extent, it would be a good idea to go through with the application.
Annual fees can be justified, but they don’t have to be tolerated. Consumers are getting the final say in the matter through their ability to choose one lender over another. If one lender advertises no annual fee, it could mean a loss of business for separate lender. As a result borrowers are at good odds in finding a lender who doesn’t charge an annual fee. Most major creditors won’t do so in average circumstances.
Sometimes all you need to do to get what you want in life is to ask for it. If you don’t want an annual fee, ask for it to be waived. Lenders are more desperate than you realize in having your business, and odds are they will agree, albeit with a smidgeon of hesitation. If they don’t agree, its’ time to go back to square one.
In Conclusion
Whether or not you pay an annual fee is ultimately up to you. There are cases where you can justify doing so, but you certainly won’t have to. In times like these, we can thank the competition among the financial industry for making the fee optional.
Learn more about student credit cards and no annual fee credit cards.
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