How to avoid certain credit card fees

 Credit card fees are another way for the credit card companies to make money from their customers and as their customers are effectively in debt with them anyway, the process puts them under yet more financial strain and often helps deepen their debt. There are a few reasons for this happening. Sometimes it’s the customers fault, sometimes it’s the greed of the company and sometimes it’s just a misunderstanding how knowing how to prevent paying them is always an advantage.

 One of the most common fees is a “late fee” charge when a payment has been processed late due to the customer not paying the payment on time. Despite the fact there are a numerous ways of paying the bill, some are usually quicker than others. For example a card payment over the phone can take as little as 3 days to clear, whilst a cheque can take significantly longer and direct debits are taken so they clear on time. So make the payment in a way it will clear on time rather than incurring a late fee (typically a 12 GBP flat rate in the UK) that you don’t need to pay. In fact if you pay by direct debit you don’t even need to wait for the bill to come to authorise or make the payment, it will just take it automatically actually saving you the hassle of needing to make the payment when it’s ready.

 If it’s going to be late due to some financial problem, but you will have the money by a certain date, inform the company as they are able to change the due date as long as it’s asked for 5 days in advance (although some restrictions do apply). This will save you paying it if you’re wage is going to be late for example or you’re waiting for a cheque to clear into your account.

 A similar charge is the “unpaid payment” fee, this is actually more of a returned payment charge and is where either a direct debit hasn’t been able to clear due to lack of funds in the debit account or a cheque has been unable to clear (again due to lack of funds in the account). This is again a 12 GBP payment typically in the UK and often goes hand in hand with a late fee payment however prevention of this is easy, don’t send a cheque if the money isn’t there, and cancel the direct debit if you know the money won’t be there. Your bank will charge 8GBP for a returned direct debit as well so it’s often a really clever idea to cancel them rather than pay 20GBP extra for something you can cancel immediately over the phone. Again this will need to be done before the date at which the credit card company are due to take the payment much like changing the due date.

 The third type of charge a credit card company will try to charge you is a fee for being over your limit (12GBP a month again) this in turn puts you further over your limit and makes it more difficult to get back under it. This can easily be avoided through a number of ways, the most simple way is to keep spending on it to a minimum, check your statements to know your limit and keep within it whilst also accounting for fees that apply to transactions. Don’t try and run it close to the limit or you’re playing with fire and you have to expect to be burnt. However if you do intend to make some bigger purchases but want the security that comes with paying on a credit card you can part pay by card and you can also call your provider in advance to request them to increase your limit. The provider may or may not be willing to, but sometimes it may be worth asking.

 However these aren’t the only charges that you may face. You will usually be given a charge when you use the card for cash withdrawals to a percentage of the cash taken, so to avoid this use your own money when ever possible, the charge may only be 3GBP for example but it’s 3GBP that you’d rather keep so why not keep it? Balance transfer fees may also apply in some cases though often you may be happier to incur these to have your full credit balance put on a lower interest card. Make sure you are aware of how much the charge is going to be (as it may incur you an over limit fee as well). Most importantly though will be the interest, though not an actual fee it can still make paying off credit cards an almost impossible task at times. The best advice for avoiding this is to pay off your balance every month or don’t use a credit card. In fact the best way to avoid the fees and charges attached with credit cards is to avoid them full stop.

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