Using a credit card involves incurring various fees that you must pay to be a cardholder - this includes cash advance fees, interest fees, penalties on late payment among others. However, with a little smart thinking, you can save on the applicable annual fee on the credit card. Premium credit cards that carry a high annual fee are advantageous only if you have a high income and make large purchases regularly. For this scenario, you would find the additional perks are well worth it. But, if you’re looking for economical spending and don’t need perks, you might want to opt for a no annual fee credit card.
Many credit card providers offer you credit cards at 0% for the initial 12 months. Once the promotional period ends, the usual annual fee is applicable. Depending on your usage and spending habits, you can opt for credit cards that carry no annual fees.
So, here are the top 3 reasons why you should use a no-fee credit card:
No-fee credit cards typically don’t offer many perks and benefits. For this reason, they are well-suited for the user who does not regularly charge large purchases on the credit card or travel much. If you would rather save on the annual fee and don’t need the added perks like say, credit cards with travel rewards, no-fee credit cards are a good option. Choose these cards for situations where you absolutely need a credit card. Like for instance, online shopping, occasionally booking flights and hotel rooms or renting a car.
Paying annual fees is beneficial only if you use your credit card often and earn enough cash back and reward points that cancel out the yearly fee. Of course, you’ll have to make sure to pay off the credit card bill each month in full so you don’t incur any other fees.
For example, you could consider the Tangerine Money-Back Credit Card. This card earned the 2016 Product of the Year Canada™ award based on a national consumer voting survey. Here are the perks it offers:
Owning a second card is always advisable and you can choose a credit card with no annual fees for various situations such as:
For example, consider the SimplyCash Card from American Express. Here are the benefits of using this card:
The last, but not least important reason why you should get a no-fee credit card. As a young person who has just graduated from university or college and now holding a full-time job, you could consider opting for the no-fee credit card. Here’s why:
For example, consider the MBNA Platinum Plus MasterCard. Here are the benefits of this card:
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