The typical credit card carries an interest rate of 17.01%. That’s up 1.79% from 2016, when the average credit card interest rate was 15.22%. CreditCards.com looked at a representative sample of 100 U.S. credit cards between August and September of 2018 to gather information about interest rates and fees.
These credit cards have the most fees
Unlike interest rates, which are creeping upward, the number of fees that the average card charges is shrinking. The average card came with 5.5 fees in 2018, down from 5.9 in 2017. Late payment fees and cash advance fees are the most common. Almost all cards surveyed came with these fees.
Over-limit fees were rare, with only five cards coming with this potential fee. Only 26 cards charge an annual fee.
Though the average number of fees was down, some cards still come with a basket of potential fees. The worst credit cards in terms of number of possible fees were:
- First Premier Bank credit card: 12 potential fees
- Barclays Arrival Premier World Elite Mastercard: 9 potential fees
- Carnival World Mastercard from Barclays: 9 potential fees
- Platinum Delta SkyMiles Card from American Express: 9 potential fees
- Starwood Preferred Guest Card from American Express: 9 potential fees
- Gold Delta SkyMiles Card from American Express: 9 potential fees
- SunTrust Specialty Business Card: 9 potential fees
In addition to extra charges for late payments and cash advances, some of these cards had fees you might not expect. You’ll pay an extra $15 for expedited shipping if you need to replace your Carnival World Mastercard, for example. If you book travel over the phone with your Gold Delta SkyMiles card, you’ll pay a $25 fee.
The lesson? Read the fine print before you sign up for a card.
Should you avoid a credit card with fees?
A credit card may come with a lot of potential fees, but that doesn’t always mean it’s a bad card. If you’re a frequent Delta flyer, for example, either the Platinum Delta SkyMiles card or the Gold Delta SkyMiles card from American Express might be worth it if the rewards you earn cancel out the annual fee and you can avoid getting hit with extra charges.
Savvy credit card users are able to avoid many fees. Pay your bills on time, and you’ll never need worry about your card’s hefty late payment fee, for example. (Under federal law you can be charged up to $27 for your first late payment, and up to $38 if you’re again within the next six months.)
If you’re planning on moving balances around, look for cards that don’t charge a balance transfer fee. And avoid taking cash advances on your card, which usually come with fees, higher interest rates than standard purchases, and start accruing interest right away.
What if you mess up and do get hit with a fee? Call your credit card company and ask if they’ll waive it. Eighty-four percent of people who asked to have a late fee removed were successful, a CreditCards.com survey found.
The one credit card that charges no fees
In their survey, CreditCards.com uncovered one card that charged zero fees: The PenFed Promise Visa.
This no-fee card has a low APR (11.49%-17.99%), making it appealing to those who want to avoid the risk of extra charges. There’s no annual fee, and you won’t pay extra for balance transfers, foreign transactions, or cash advances. There’s no late payment fee and no penalty APR.
But there’s a catch. Only a select few can get their hands on this card, which is only issued to people who are eligible for a Pentagon Federal Credit Union membership. That group includes military service members, government employees, and people who work for certain employers or are members of select organizations.
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