Common credit card fees
Credit cards can come with several fees, including annual fees, late payment fees, and more. Knowing what to watch for can help you avoid surprise charges and keep more money in your pocket.
Key takeaways
- Look for cards with no annual fee when building credit
- Set up autopay or reminders to avoid costly late fees
- Skip cash advances — they carry extra fees and higher interest
- Check the Schumer Box to quickly compare fees before you apply
Credit cards are useful tools, but they can also come with extra costs. Understanding the fees before you use a card helps you make smarter choices.
The most common fee is the annual fee. This is a yearly charge just for having the card. Some cards charge nothing. Others charge anywhere from a small amount to over a hundred dollars per year. If you are building credit, look for cards with no annual fee or a low one. That way you are not paying just to keep the account open.
Late fees are another big one. If you miss your payment due date, the card company can charge you a fee. This can be $25 or more, depending on the card. Late payments can also hurt your credit score. Setting up a reminder on your phone or enrolling in autopay for at least the minimum amount can help you avoid this.
Some cards charge a foreign transaction fee. This applies when you use your card in another country or buy something from a foreign website. The fee is usually around 1% to 3% of the purchase. If you travel or shop internationally, look for a card that waives this fee.
Another fee to watch is the cash advance fee. This happens when you use your credit card to withdraw cash, like at an ATM. Cash advances usually come with a fee plus a higher interest rate. It is generally a good idea to avoid using your credit card as an ATM.
Balance transfer fees are charged when you move debt from one card to another. This is often around 3% to 5% of the amount you are moving. Even if a card offers a low promotional rate, the transfer fee could eat into your savings.
Finally, some cards charge an over-limit fee if you spend more than your credit limit. Not all cards do this, but it is worth checking your card's terms.
The best move is to read the card's fee schedule before you apply. It is usually listed in the terms and conditions. Look for the section called the Schumer Box, which summarizes the main fees and rates in a standard format.
Knowing these fees gives you power. You can choose cards that fit your life and avoid costs that sneak up on you.
Related FAQs
Common questions about this topic, answered simply.
Can I get a credit card with no annual fee?
Yes, many credit cards have no annual fee, including some cards designed for people building or rebuilding credit. Always check the card's terms before applying. A no-annual-fee card can be a good starting point if you want to keep costs low.
What happens if I pay my credit card bill late?
You may be charged a late fee, which can be $25 or more depending on your card. Your credit score could also drop if the payment is reported as late to the credit bureaus. Setting up autopay for at least the minimum payment is one way to avoid this.
Is it ever a good idea to get a cash advance from my credit card?
In most cases, it is better to avoid cash advances. They usually come with an upfront fee and a higher interest rate that starts right away, with no grace period. If you are in a financial emergency, explore other options first, like a small personal loan or a credit union payday alternative loan.
What is the Schumer Box and where do I find it?
The Schumer Box is a standardized table that credit card companies are required to include in their terms and conditions. It lays out key costs like interest rates, fees, and penalties in a clear format. You can usually find it on the card's application page or in the welcome documents.
Will I be charged a fee if I go over my credit limit?
Some cards do charge an over-limit fee, but many do not. Under federal rules, card issuers must get your permission before allowing charges that exceed your limit and charging you a fee for it. Check your card agreement to see how your card handles this.
Are balance transfer fees worth it if I am trying to pay down debt?
It depends on the numbers. A balance transfer can help if the interest savings outweigh the transfer fee. Run the math before you move any debt, and make sure you can pay down the balance before any promotional rate period ends.
Keep reading
Over-limit and penalty fees
Over-limit and penalty fees are extra charges that can sneak up on you and make your credit card balance grow fast. Knowing what they are and how to avoid them can save you real money.
Read Credit cards and usageWhat a cash advance really costs
Cash advances on a credit card can feel like a quick fix, but they come with extra fees and higher interest that add up fast. Here's what you're really paying for.
Read Credit cards and usageBalance transfers explained
A balance transfer moves debt from one credit card to another, often to save money on interest. Understanding how it works can help you decide if it's the right move for your situation.
Read Credit cards and usageWhat to do if you can't pay your card
When you can't make your credit card payment, you have more options than you might think. This guide walks you through practical steps to take right now.
ReadTest what you learned & earn points
Take a quick 3-question quiz on this article to earn MoneyFAQ points, build your streak, and unlock badges. Free account required.
Want answers personalized to your situation?
Tell us your #1 money goal and we'll tailor MoneyFAQ to you — free, takes 10 seconds.
When you're ready, here are some options
These are ads from partners — always optional. Looking is free and never affects your credit score. Reading the guide above is completely free either way.