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The 2 Types Of A No Annual Fee Credit Card

admin — Sat, 19 Mar 2011 16:08:14 +0000

Credit cards are a fantastic convenience and make purchasing at retail and online a breeze.

Usually, however, these credit cards come with fees, usually an annual fee that is paid yearly. Though the exact cost of the yearly fee varies based on card, issuing institution, and other factors, the fact stands- having to pay each year to use the card can get expensive. There are no annual fee cards, that exist though. Without having to pay that annual fee, that’s a guaranteed savings right? Not necessarily. Being that the credit cards are in the business of making money rather than providing convenience, they have to make up that money somewhere. There are two ways that credit card companies can get you with no fee cards rather than standard fee-bearing cards.

Interest Rate

Imagine that you have a credit card that requires a $50 annual fee. That is an extra $50 that you must devote to the ‘subscription’ of maintaining that card each year, however, to the credit card company, that is an extra stream of revenue each year. Now imagine there is another competitors card that offers the same limit as the one you have but with no annual fee. What’s the catch? Check the interest rate. In order to make up that extra $50 loss in revenue each year, more often than not, these fee-free cards will have a higher interest rate. Rather than the relatively low interest rate of your fee-bearing card, you instead may be forced to live under the umbrella of a much higher interest rate on a fee-free card. This may not be a problem if you pay your balance off each month, however, should ever an event occur requiring you to carry a balance, you will suffer the effects of a much higher interest rate on that balance. The question then becomes, does that difference in interest rate amount to more or less than $50 for a carried balance?

Rewards Program

Many fee-bearing credit cards offer compelling rewards programs with their credit card purchases. These usually entail a one point per dollar spent type of system where over the course of a year, points are accrued and can be used as virtual currency for any number of things. Rewards can be anything from discounts on rentals or vacations to retail items, gift cards to retail locations to free dinners at participating restaurants. The philosophy here is earning on what you’ll otherwise already spend. Typically, fee-free credit cards to not support rewards programs. Depending on how much you spend each year using your credit card, having to pay the extra amount for an annual fee may be worth your time just so that you can participate in the rewards program.

No Annual Fee Credit Cards – Saving Money On Annual Fees

admin — Wed, 16 Mar 2011 18:03:33 +0000

Annual Fees And You

You might have noticed that many credit cards have annual fees. Maybe you’re even paying an annual fee for one or more of your credit cards. In fact, if you have a rewards card, it’s almost guarantee that you have an annual fee. That annual fee can be low (as low as $18, maybe less) or very high (a few hundred dollars high). This is the fee you pay every year for the mere privilege of carrying the card and borrowing money from the lender. Usually, they’re used as a way of supporting rewards programs.

You can generally expect this fee to be charged to your credit card, just like a purchase would be. If you don’t pay your fee in the month that it is charged, it will accrue interest, just as any other purchase on your card would. When you consider these fees, especially if you have one of the cards with annual fees in the hundreds of dollars, you might see why it could be a good idea to find a credit card with low or no annual fees. More often than not, you’ll find that you get the same things out of your no fee cards as you do from your high fee cards.

Cards Without Fees

You can generally find that cards that have no annual fees will fall into one of two categories. The first is usually the best kind and is the card where this is currently no annual fee and there never will be an annual fee that you have to pay. The second category is the one where they waive the annual fee for the first year as an introductory offer. Even those cards with “no annual fees” have a way of charging you extra fees if you enroll in a rewards program, so it’s best that you check your terms and conditions closely to be sure. There are also cards you will run across that tell you they have an annual fee, but that it can be waved if you spend $XXX dollars a year. If you regularly spend on your credit card, this might work for you, but if you prefer to use it as an emergency fund, avoid them.

Any time you’re looking into a new card, you have to pay close attention to everything you’re going to be getting into. Places they can hide charges are all over the place, such as with certain American Express cards. They advertise no annual fee, but give you the option to join a rewards program. That rewards program will set you back $80 annually. On the other hand, the Zero Platinum card from Bankwest will charge you no annual fee. And no hidden charges. At all.

Any time you’re applying for a rewards card, you can be relatively certain there is some form of fee involved. When applying for frequents flyers style cards, there also probably a fee attached to signing up with the airline you’ve chosen. Be sure that you research all aspects of your credit card thoroughly to avoid any surprises which may be hidden in the terms and conditions or rewards programs.

The Great Difference Of A Credit Card With No Annual Fee

admin — Wed, 16 Mar 2011 04:48:50 +0000

Finding Your No Annual Fee Credit Card

Most people who are in the market for a new credit card would be ecstatic to find a credit card that features no annual fee. People throughout the world would love to be able to use a card that isn’t going to make them extra debt because it’s just sitting there, and a true no annual fee credit card would do that, and those that do exist are very popular among the people of the world.

Facts About No Annual Fee Credit Cards

First and foremost, you can typically expect that your no annual fee credit card is going to come with an unwanted feature: higher interest rates. At least that’s the case in most instances. There are exceptions to every rule. Should you choose the card just for emergencies, then you’re probably going to be alright. However, if it’s an expensive emergency, then the interest could end up costing more than your annual fee might have.

The biggest reason for this is that there are very few no annual fee credit cards that include an interest free grace period with their cards. These cards are generally “no frills” type of cards, so you’re stuck with the most basic service possible, and you’re paying interest from day one. The cards that you find that offer no annual fee and interest free days generally do so as some sort of promotion.

What Might You Pay?

Low annual fees are generally around the area of about $50, and they’ve been seen as low as $20 for certain cards. You can even find cards with annual fees of $200 or more, though these are generally those cards with a lot of extra “complimentary” services and expensive rewards programs.

Credit cards with no annual fee almost never offer the 55 or 44 interest free days that those cards with annual fees would. If you find cards with low rates and low annual fees, you might actually be saving yourself money if you use your card even once. On the other hand, if you have to use your no annual fee card for anything expensive, and can’t pay it down right off, you could be spending a lot of money in interest.

Even if you do happen to pay your balance off right away, there’s the chance that you might still be spending more money than if you go a card with an annual fee. Those interest free day could easily offset the annual fee, as could a rewards program that you used to the fullest.

There are, of course, advantages to the no-annual-fee format, but they’re rarely worth it. It might be worth it if you spend less than $500 a year and you pay it off quickly. However, if you find a card which will waive your annual fee the first year and give you your interest free days still, then by all means go ahead and use the card. Even better, you can occasionally find cards that, though they have annual fees and low interest rates and interest free days, offer you the option to spend enough money to waive your annual fee. These cards offer you the chance to get the best of both worlds, paying no annual fee and having the perks, just for spending a certain amount of money each year.

No Annual Fee Credit Cards – A Review

admin — Tue, 15 Mar 2011 04:15:42 +0000

Why Choosing This Credit Card?

From the very beginning, you should know that there are a great number of reasons why you might want to consider applying for such a financial product. First of all, the lack of annual fee can provide you with a great opportunity to save some money in the long run. Over the years, you will obtain a very important sum by adding the amount you would have otherwise paid for the services provided to you.

More about Annual Fees

The fees and the rate of interest are usually the most important factors people take into consideration when choosing the ideal product for their usage. And therefore, a great number of companies have started to come up with some very attractive offers in order to gain more customers and eventually increase the level of profit. And in most of the situations, they succeed since people are usually distracted by the great number of rewards provided to them and completely forget about the fact that everything comes for a price. And eventually, when they find that they have to pay an enormous maintenance fee they would have wanted to consider all the conditions of the product beforehand. Even though everybody likes to save when travelling or flying and benefit from some discounts when shopping with certain retailers and other marketers, but if you do not travel very often then you will realise that you pay for a feature that you do not use at all. Therefore, make sure you really need the rewards provided to you before signing a contract for such a financial product. On the other hand, with a no annual fee credit card, you will no longer have to pay for something you do not really require and you will start to see the differences in your financial life in the shortest time possible. This can be a very important decision and you will want to use it as much as possible.

Credit Cards from HSBC

One of the most important programs you should take into consideration before taking your final decision is the credit cards made available by HSBC. The deals provided by this financial institution are among the finest ones and the products with no annual fee also come with a promotional interest free period which you will always enjoy using. This period usually lasts for 55 days during which you will be able to make as many purchases as you want without having to pay back more than you actually spend. All in all, the no annual fee credit cards can help you out in a great number of situations and you will enjoy using them every time.

Why Do You Need A No Fee Credit Card?

admin — Thu, 10 Mar 2011 00:56:27 +0000

Annual fees for credit cards are varied in cost depending on many factors including limit, rewards programs and others.

There is one truth however, not having to spend that annual fee each year is a savings in and of itself. Deciding simply on this savings however is not the only thing that should be considered.

There are many ways to achieve a fee-free credit card and each has their merits based on unique needs. In this article we will take a look at a few examples of fee-free cards and explain what lifestyle they are best suited for.

No Annual Fee

There are plenty of cards offered that report to offer no annual fee as their primary feature. There is a crucial detail that many of these advertisements do not mention however- these cards are often limited. Because the card issuing company makes money from annual fees and interest, without having half of that equation, the other must make up the difference.

Typically, no annual fee cards have two distinct features that allow them to be fee free. They maintain a very high interest rate and are usually relatively low limit cards. This means, with a ‘no annual fee’ card, you are likely to see a much higher interest rate than a counterpart fee-based credit card as well as a much lower monthly credit limit available.

This does not mean this card is useless however. For an individual or family that is financially responsible and does not spend a lot of money each month, this is a great option. The key to using this type of card is to keep monthly spending low and below the credit limit and pay the balance off each month. This way you can enjoy the benefit of no annual fee without the heavy burden of such a high interest rate.

Annual Fee Waiver

Another type of no annual fee card is the waiver option. In this kind of situation, the card carries an annual fee of a fixed amount per year, unless over that 12-month period a certain amount has been spent on that card. Once that limit has been reached, the yearly fee is waived.

Typically these cards rank in the mid-range as far as limit goes and are usually on par with others as far as interest rate. However, the waiver amount can be quite large summing between $10-$20,000 year year. This can be a great tool for an individual or family that spends a fair amount of money each year on a credit card. For families or individuals that use a credit card for virtually all expenses, meeting this quota is not difficult and with the competitive interest rates and respectable limits, it’s a good alternative if you can meet the yearly quota.

Benefits of a No Annual Fee Credit Card

admin — Sun, 20 Feb 2011 03:40:41 +0000

Your credit card should reflect your personal needs, financial habits, and your personality.

Cards with no administrative fees or no annual fees are cards designed to get customers in the door and hold on to the business for as long as possible.

Always Read The Fine Print

On the cover, a no annual fee credit card sounds like an excellent idea. However, once you get down the fine print, you’ll find that there are things there that will not be in other credit card agreements. Often, with these cards, you’ll find that the lender is going to charge you a higher interest rate or that other fees are slightly elevated to make up for the loss of money they incur by offering the $0 annual fee. These people are looking to make money after all and they’re not doing so if you’re not paying an annual fee for their card.

The most common difference is a slightly increased APR than you’d find in most other cards you applied for. Essentially, they intend to charge you the same amount of money, but you’ll be paying for it over the time you carry a balance on your card. These cards are, therefore, great for people who won’t carry a balance such as the person who pays their balance every month who do not use their card often.

Consider Your Own Personality

If you’re the kind of person who pays off their full balance on their cards every month, then these no annual fee cards can save you a good deal money as the interest charges will generally be 0, and at worst they’ll be negligible. The same is true for the credit user who will use the card for occasional large purchases or who holds their card in reserve for emergencies only.

On the other hand, if you’re the type of credit user who makes large purchases as soon as the credit is available and will always be carrying a revolving balance, look into lower APR cards with annual fees. You may not think so, but you will actually save money by doing so.

How Long Is the Interest-Free Period

Most cards offer you a certain amount of time your balance is going to be interest free on purchases. Generally, this is about a month for most cards. However, with no annual fee cards, the period of time may be much shorter, or it may not exist at all. That’s the trade off for not paying an annual fee ever.

If you pay your balance in full each month, then, as stated above, the interest fees will be negligible at the worst. There’s no need to worry about the interest free period if you can pay your full balance every month. However, if you’re regularly going to carry a balance, you should definitely pay attention to how long the interest free period is. You may find that other options are better for you. Hopefully, you find this information useful in your card search.

$0 First Year Annual Fee Comparison

admin — Fri, 18 Feb 2011 02:51:03 +0000

Stop Me If You’ve Heard This One

You’ve probably already heard the ads from credit card companies offering their $0 first year annual fee promotions. Like many other ads, this one is designed to appeal to your desire to save money in order to get you to switch to their product. Before you hurry off and switch cards, you need to know what these cards are all about, what they’ll do for you, and where you’ll be spending money (and where they’ll be making it). After all, credit card companies, just like every other business, are out to make money and they’ll do whatever they can to make more of it.

Look To The Long Term

Any time you choose a new credit card, you need to choose the right card for you. Sure, you might save a couple of hundred dollars up front by not having to pay one year worth of the annual fee, but what are you paying in interest? If the rate isn’t comparable to the one on the card you already have, chances are, you should skip this offer. You also want to look into other fees that they may charge you, and decide if the trade off on the annual fee is worth any other fees you may not be paying currently.

What Do Other Cards Offer You?

The first year free promotion sounds great, but you could end up paying for it in the long run. You could always switch cards before you have to pay the fee, but that can negatively affect your credit rating. You want to choose a card that is right for you the first time around and keep your accounts open, so what are some other options?

For Life Cards

These cards offer no annual fee, ever, for the life of the card. Absolutely none. Typically, these cards are no-frills cards, meaning that there’s never any annual fee, but there’s also never any rewards program. You may also find that the rate is a bit higher in order to make up for the fact that there is no annual fee. You might save money with these cards, you might now. You have to look at the terms and conditions to decide this for yourself. If you only plan to use your card occasionally or in emergencies, these higher rates may never affect you. If you’re going to use your card constantly, then you want the lowest rate you can get.

Reward Cards

Reward cards offer you special rewards for spending money using your card. These cards also normally have a higher interest rate to cover their expense on the rewards. If you are going to pay your card off every month on time, then you won’t have to worry about the rates and you’ll gather some free rewards in the process. If you tend to carry a balance however, they may not be the best for you.

It definitely pays to research the costs and benefits of each card. The different types of cards work better for one person than another, and you may find the the first year annual fee waived cards are great for your. Conversely, you may find a better deal elsewhere.

Credit Cards With A No Annual Fee Offer

admin — Wed, 16 Feb 2011 08:25:06 +0000

What Card Is Best For You?

A “no annual fee” credit card sounds great. You don’t have to spend money on what is possibly an annual fee in the hundreds of dollars and you get a credit card. That sounds absolutely amazing, but is it the best deal for you? Can you find the other cards benefits you want in a card with no annual fee? If it’s not, what is the best card for you? While you may think you know what you want in a card, what is best for you is dictated by your financial situation, not what you want.

The No Annual Fee Card

Though there are many different cards available and the no annual fee card may not be best for you, this article focuses on that card, its advantages and its drawbacks. These cards are offered by lenders with no annual fee. Most of the cards you’ll find have an annual fee that can range from very low to up to a few hundred dollars. It’s possible to find reward cards with no annual fee, but it’s quite rare.

Though most other cards charge an annual fee, these cards do not charge an annual fee. While this may sound great when you hear it, you need to dig deeper to see if the savings are worth it. Lenders are businesses, after all. And businesses exist to make money. In order to offset the cost of not charging you that yearly fee, they may have noticeably higher interest rates or higher fees for other things your card offers.

When you’re considering choosing a no annual fee credit card, specifically with a higher interest rate, you’ve got two major questions to ask yourself. How much do you plan on using the card? Do you intend (and are you able) to pay the balance in full each month? If you don’t plan to use the card much, for instance, in an emergency – it may well be worth looking into. If you can afford to pay the balance in full every month, it may also be worth it to check out a no annual fee card.

These cards are excellent for the people who will regularly pay their balance in full, as there will be no late fees to worry about and the interest charges with be non-existent in most cases, negligible in a few. They are also great for “in case of emergency” card holders who will only use the cards in drastic circumstances and who will be able to pay off the balance quickly and without carrying a balance.

What You See Is What You Get

With no annual fee cards, you almost always get exactly what you see. A card with a credit limit and an APR. There are rarely any benefits to these cards, though they can be found. You will find no annual fee cards to be the bare bone option of credit cards, offering few, if any special offers or insurances, etc. If you’re looking for benefits other than buying power, you should look into cards with annual fees or be ready for a long search and higher interest fees.

What Are Credit Card Annual Fees?

admin — Thu, 10 Feb 2011 02:46:16 +0000

More About Annual Fees

Despite their apparent advantage for the customer, credit cards that come with exceptional programmes that aim at rewarding every customer are the ones that have the biggest annual fees. In most of the cases, the provider will promise you extra services, such as insurance, extended warranties or even covering some of your travel expenses. Before getting caught into this trap and sign the contract without a second thought, always keep in mind that no service comes with no additional cost. The bank will generally get its money bank from charging you more for your credit card every year.

Therefore, it is very important to factor in the annual fees first when it comes to comparing the offers for credit cards. If you are not interested in the special offer or you think they will be of no use to you, then you should most definitely opt for a zero annual fee credit card.

Credit Cards With No Annual Fee

If you decided that this is the best alternative for you, then you should know that there is a great number of options to choose from. In Australia, the following types of credit card come with no annual fee:

Low Fee Card by Commonwealth Bank
First Visa Card by ANZ
Standard Card by NAB
Zero Card (also known under the name of Gold Card or Platinum Card) offered by Bankwest
55 Day (Gold / Platinum) Card, offered by Westpac
Low Rate Card by Westpac
Everyday Money Card, issued by Woolworth
HSBC’s Credit Card

The Advantages of Annual Fee Cards

At first, you would probably think that choosing for a zero annual fee credit card is by far the best alternative. However, you should think twice because in most of the situations you will also have some advantages by paying fees to your bank. Most of them are as follows:

Medical Care offered Overseas
Extended Warranties
Frequent Flyer Miles
Insurance for your travels
Concierge Service
Discounts for a great number of hotels and restaurants
Retail Discounts
Purchase Protection

Considering all these advantages, it is very important to do some basic math before choosing what credit card is best for you. You might often find out that applying for a credit card with annual fees can bring you more advantages than zero fee types. Therefore, you should always consider which, of any, of the advantages offered to you by paying fees will be useful and if the amount obtained would be less than the cost of the annual fee, then it would be much more profitable for you to continue paying annual fee and use the special services. On the other hand, if things are not as you wanted, you always have the other alternative.

Why A No Annual Fee Credit Card Is Important

admin — Wed, 09 Feb 2011 04:30:01 +0000

Too Many Choices

There are so many credit cards that do not charge an annual fee that it is sometimes confusing why anyone would choose to carry a card that charges an annual fee. Let us examine the benefits of choosing a card without an annual fee.

When you pay an annual fee, you begin in debt, and every single year that you own the card, you accrue more debt. Even if you do not use the card or you pay off your balance in full every single month, you are going to pay a fee. Why? Fewer and fewer products and services are charging fees as customers are getting pretty upset with the idea of having to pay just to use something. And with all of the no fee credit cards available, those that still charge a fee are seeing that they need to reconsider. Can you imagine carrying a card for emergency purposes, never using it, but receiving a bill for an annual fee when you do not even use it?

Unless the card saves you more money than you pay every single year, there is simply no justification for requiring you to pay an annual fee. And you should shop around exhaustively before you settle on a fee based credit card because for every card that charges a fee, chances are that there is a card just like it somewhere that does not charge annual fees. So find that card and save money.

Even for some cards that charge higher interest rates than some cards that charge annual fees, the lack of the annual fee may save you more money. The average annual fee nowadays is about $100 a year, that can really add up over time.

Credit cards that charge annual fees are more geared towards those who use their credit cards very often and prefer the rewards program that the card probably offers. For those who will not use their card very often, or are on a fixed or low income and will not receive much benefit from any offered perks, there is little reason if any to consider a card that charges an annual fee.

Do Not Create Your Own Annual Fee

With all of this being said, it must also be said that all of this hassle of finding a card with no annual fee is of no use if you are just going to end up paying fees in the long run that may end up equalling or exceeding the annual fee anyway. Make sure you use your card responsibly and make your payments on time, and try to pay more than the minimal. Keep the balance low and practice smart spending. Credit card companies as a whole expect to recoup the loss of revenue from not charging an annual fee by charging you fees when you miss a payment, or high interest, or alarmingly high ATM fees. So be smart with your no annual fee credit card and you will save money.