Beware of credit cards with excessive fees
While credit cards aren't created equal when it comes to interest rates, there's another area where consumers need to be on their toes: fees.
The average credit card has six likely fees, with the most common one being a late payment fee, according to a new survey from CreditCards.com. This fees is assessed by 99 out of the 100 cards surveyed in the study. But some cards carry more pitfalls than others, with the worst offenders carrying 12 potential fees, said Matt Schulz, senior industry analyst at CreditCards.com.
"With the Credit Card Act, there was a lot of experimentation done with banks to figure out ways to regain some of the revenue that was no longer possible because of those regulations," Schulz said. "Even though there are lots of these fees, the good news is the vast majority can be avoided by shopping around for a card and setting up auto-payment once you get the card."
Interestingly, annual fees are quite rare: Only 25 of the 100 cards charge one. Ten cards waive the annual fee for the first year.
After late payment fees, the second most common fee is for cash advances. Many cards charge $10 or 5 percent of the cash advance, which ever is greater. Cash advances from credit cards also start charging interest immediately, unlike purchases, which can end up being costly to consumers
Other common extras include balance transfer fees, which 90 percent of the cards charge, and penalties for returned payments (82 percent). About 77 out of the 100 cards charge foreign transaction fees, which can be 3 percent per transaction.
"Foreign transaction fees can really add up, especially because a foreign trip is expensive enough without having to add another 3 percent on top of it already," Schulz said. "If you travel overseas quite a bit, one of your main priorities should be to get one that does not have foreign transaction fees."
Less common charges include paper statement fees, which can be $5 per statement, expedited phone payment fees and account reopening fees.
Below are the worst and best cards regarding fees. The number of potential fees is in parenthesis next to the card name.
Most potential fees
First Premier Bank Credit Card (12)
First Premier Bank Secured MasterCard (12)
Credit One Visa Platinum (9)
Fifth Third Bank Platinum MasterCard (9)
Navy Federal Credit Union Platinum (9)
Navy Federal Credit Union Cash Rewards (9)
Regions Visa Platinum Rewards (9)
Fewest potential fees
PenFed Promise Visa Card (0)
ExxonMobil SmartCard from Citi (3)
Spark Classic from Capital One (3)
Capital One Spark Cash Select for Business (3)
Spark Miles Select by Capital One (3)