What is Annual Fee?
What is Annual Fee?
This is like a membership fee that you pay once a year to your credit card company for using their card. Not all credit cards have an annual fee.
So, if your credit card has an annual fee of $60, that means you'll pay $60 per year, usually added to your credit card bill, just for the benefit of using that card.
It's important to see whether the benefits you get from the credit card, like reward points or cash back, are worth more than the cost of the annual fee. If you don't use the card much, the annual fee might be more than the benefits you receive.
3 things to know about Annual Fees
1. They Can Be Waived: Sometimes, credit card companies might waive the annual fee for the first year as a part of a promotion to attract new customers. Also, if you're a long-term good standing customer, you may be able to negotiate a fee waiver with your credit card company.
2. Vary Widely: Annual fees can vary widely in amount. Some credit cards might have an annual fee of $25, while others could go up to $500 or more, usually for luxury cards that offer more perks and benefits. It's important to consider whether the value you get from the card offsets the annual fee.
3. Not Always Bad: While paying an annual fee might not seem ideal, sometimes the benefits offered by the card can more than make up for it. For example, a card might have a $95 annual fee, but offer travel rewards, discounts, or insurance policies that would cost much more if purchased separately. In these cases, the annual fee can be worth it for some people.
Disclaimer: Yendo is not a provider of financial advice. The material presented on this page constitutes general consumer information and should not be regarded as legal, financial, or regulatory guidance. While this content may contain references to third-party resources or materials, Yendo does not guarantee the accuracy or endorse these external sources.