Decoding the Fine Print: Your Credit Card Fee Schedule

When you apply for a new credit card, chances are you don’t pay much attention to all those long legal disclaimers. The terms and conditions, the fine print, the nitty-gritty—whatever you call it, it’s boring.

The problem is, ignoring the fine print can mean missing out on important information. For example, the fee schedule. This is a list of fees charged by your credit card issuer. You may think that if you have a no-annual fee credit card, you don’t need to worry about fees, but this isn’t true. Every card has fees. Here are some of the common ones, what they are for, how much you can expect them to cost you, and how to avoid them.

• Annual fee. This is a fee charged once a year on the anniversary of your getting the credit card. It’s commonly waived the first year, and by the time year two rolls around, it may take you by surprise. Annual fees can vary from about $25 to over $400, with many falling in the $65-$95 range. Paying an annual fee is not always a bad thing, so try not to have the attitude that any card with an annual fee should be avoided. Some of the best rewards cards, particularly travel rewards cards, have high annual fees—but they well worth it if you use the rewards and perks.

• Balance transfer fee. This fee is charged to transfer a balance from one card to another. Usually 3% to 5%, with a minimum of $10 per transfer, the fee can be worth paying if you’re transferring a large balance with a high interest rate to a card that offers a 0% APR for some period of time.

• Cash advance fee. If you’re in a jam and need to get cash from your credit card at an ATM, you won’t just pay high interest on that withdrawal, you’ll pay a fee of anywhere from $10 or more, to some percentage of the amount you withdraw, usually around 5%.

• Overdraft protection fee. This is a fee your credit issuer will charge you instead of rejecting a purchase, when you go over your credit limit. So, if you accidentally charge too much to your credit card, the cashier won’t tell you your transaction was declined—you’ll just see this charge, often around $35, on your next statement. The solution? Keep track of your balance and don’t max out your credit cards.

• Foreign transaction fee. This might also be called a foreign currency fee. It’s charged when you use your card outside the United States, and is usually 2% or 3%. Many cards don’t have this fee, especially travel rewards cards. If you travel abroad often, look for a card that doesn’t have a foreign transaction fee.

• Late payment fee. This one is pretty obvious. When you make a payment after the due date, you’ll be charged a late fee, usually around $35. You can avoid this by setting up automatic payments that ensure your minimum is always paid on time. If you mess up once or twice, you can often call your credit card company and ask them to waive the fee. They often will.