Sick Of Paying Bank And Credit Card Fees - How To Avoid

Sick Of Paying Bank And Credit Card Fees? Here's How To Avoid 3 Of The Most Common - By Steve

Banks, credit card companies, and other businesses love to charge you fees for violating their rules. Whether it's late fees, ATM fees, check stop-payment fees, overdraft fees, bounced-check fees, or any other fee, businesses are determined to get every dime out of you they possibly can. But there are ways you can avoid paying these fees. You just have to be shrewd. Here's how to avoid paying three of the most common fees.

1) ATM Surcharges -- Any time you use an ATM that doesn't belong to your bank, you're going to pay for it. Sometimes the charge is only a dollar. But it can be as high as $4 or more, depending on the bank. And sometimes your own bank will charge you for using another bank's ATM. That makes for a really expensive withdrawal.

How to Avoid -- The best way to avoid these fees is to plan ahead and withdraw money from an ATM your bank owns. But you do have another option. Many grocery stores, drugstores, and discount stores (such as Wal-Mart) will allow you to get cash back from the register when you use a debit card to check out. The bank you use typically won't charge you for these transactions.

(2) Credit Card Overdraft Protection -- Many banks offer a credit card to protect you from overdrawing your checking account. But the protection comes with a price. While the fees are usually cheaper than overdraft charges, they're still expensive. Most of the cards will charge a fee each time the protection is used (up to $20 per transaction). And they count the transaction as a cash advance, which almost always carries a higher interest rate. To make matters worse, the transaction begins to draw interest the day it's made. There is no grace period.

How to Avoid -- The most obvious way to avoid this is to keep enough cash in your checking account to make sure you never overdraw the account. If that's too difficult, put some money in a savings account and set it up as your overdraft protection. Just make sure you put the money back as soon as you can. Otherwise, you'll deplete your savings.

A Word of Caution -- Many banks will charge you a hefty fee for overdrawing your account. And they'll charge the fee each time you do it. So if you use a check card or debit card to purchase small items, such as coffee or meals, each purchase that overdraws your account will rack up another $30+ charge to your account. Before you know it, you're charged $150 without even trying.

(3) Credit Card Late Payment Fee -- When you use a credit card, you have to make a payment by the due date. If you don't, the credit card company charges a huge fee (up to $39), and it damages your credit report. Even worse, credit card companies do everything they can to make you late for your payment. For instance, they have the due date on Sunday. But the company is closed on Saturday and Sunday. So the payment is actually due on Friday. If you plan to have your payment arrive on time, the mail won't arrive until Monday -- and you get slapped with a late fee. They also change their mailing address with no warning. If you make payment using auto-bill pay, you'll mail the check to the wrong address. And the company won't give you credit for the mistake.

How to Avoid -- If your bank offers a bill-pay feature, see if it also accepts electronic bills directly from your credit card company. If so, you can sign up for electronic billing and then set up your payments to be paid either immediately upon receipt of the bill or by the payment due date. Either option will allow you to avoid late charges. If electronic bill-pay is not an option for you, you'll need to make your payments early or get rid of your credit cards and use cash only. Actually, there's one other choice, but not many cards offer it. Some credit cards will let you sign up for the company to withdraw the full amount due on the due date from your checking account. I don't like the idea of giving them access to your checking account, but it's usually better than paying late-payment fees.

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Credit Card Reward Points - A Consumer Guide

Credit Card Reward Points - A Consumer Guide To Choose Smartly Among Many Reward Options- By Jaydeep
ICICI Bank has perhaps the largest credit card base in India and also has one of the most elaborate reward programs among the banks. They are the ones who started the express reward program which gives accelerated accumulation of reward points depending on the total purchase on a card and it gives incentive to customers to spend on ICICI card as they can accumulate points at up to five fold speed than the normal pace of 1 point for every Rs 100 spent. The express reward program of ICICI Bank became popular in no time as customers were accumulating more points than other cards and their express reward program were soon emulated by other banks like HDFC.

The first thing that a consumer should understand that it is not only the number of reward points that matter but also the kind of gifts that are available for redemption and the number of reward points required to redeem them. I have been using credit cards for the last 10 years for personal and business expenses and always do my analysis before redeeming the points which I accumulate on a regular basis. I have cards from almost all leading issuers like ICICI Bank, HDFC Bank, Citibank, Standard Chartered and HSBC Bank and if you ask my pick I would say HSBC among silver card and HDFC among gold.

ICICI Bank which is the most aggressive player in the credit card space but it has also the most hyped reward program. Initially it had very good reward options like Taj and Welcome group hotel vouchers for its gold members but those has been withdrawn long back. Actually their express reward program has lost its attraction as you need more ICICI reward points to redeem a gift (say a Pantaloons voucher worth Rs 500) compared to other cards like HSBC or HDFC.

Usually the banks have more or less the same gifts for its reward program but now individual banks are working to differentiate in their offerings. Still the common items across all reward programs are the departmental store vouchers, vouchers for apparel and fashion accessory brands, fast food restaurant vouchers and some consumer durable products like mixer/grinder, toaster, OTG and microwave. But a consumer having more than one credit card will do well if he first compares and then select the right reward points for claiming a particular voucher as I have found that you need almost double reward points in ICICI card than that of HSBC to claim some particular gifts.

If you have a gold card then probably you have a wider choice as most banks have some special reward options for gold card members which are generally leisure products like hotel vouchers, perfumes and collectibles. The HDFC gold card program allows you to choose between some good perfume and EDT but I would not suggest the collectibles like Victorinox Swiss Army Knife or Magpie bar set as I don't think those deals are attractive. For ICICI gold members the deals are not so good anymore as now they have more deals which require you to pay additional money and not just reward points.

ICICI Bank has something called spotlight rewards where they try to push junk and cheap Chinese made electronics products like digital camera, USB pen drive and so on and that too sometimes on cash and reward points. The spotlight rewards are highly avoidable and basically they provide the least value in any reward category by any bank. I personally ordered once for a foldable tea table by redeeming for more than 1000 points under the spotlight reward category and the stuff I got was actually defective and would hardly cost Rs 100.

It is not only ICICI that ships defective materials but other banks too and so the choice of the gift is very important if a customer wants to make the most out of its reward points. I ordered once OTG from my HDFC Gold card and the OTG was found defective. After lots of complaints and persuasion that defective OTG was replaced with another defective one and since that day I decided to never go for any consumer durables.

I think a smart consumer should avoid consumer durables and any electronic items as these credit card companies seems to source factory seconds to cut cost which is actually shameful. The best things you can get are the vouchers but don't forget to make the comparison if you have multiple credit cards. Some other things you can try are perfumes, magazine subscriptions and collectibles but make sure that they are not asking for too many reward points.

If you are holding a co-branded card like Citibank Jet Airways or Amex Indian then converting the reward points to Air miles are a good option. HSBC silver cards also offer Jet Airways and Kingfisher air miles and that's why I think it has one of the best reward programs as on today.

The final advice is don't get yourself in a debt trap by getting lured by the gifts and express reward programs. A smart consumer pays all bills and expenses thru credit cards but also pays the credit card bill in full. This is the best way to accumulate your reward points and redeem them for cool gifts at a later point with incurring interest or additional cost.

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Using Your Card: What Is Its Purpose?

There is a wonderful feeling to having a credit card when you need one, but that blanket term "credit card" can be misleading at times. Not all credit cards are the same, and this goes beyond the APR that most people are aware of. Before choosing a credit card, consider what it is that you plan to use it for. This can make a big difference in how you use it and what you will pay in charges and fees for using it.

There are some consumers who will pay off their bill each and every month, and rarely, if ever, carry the balance over into the next billing cycle. If you intend to follow this routine, then APR will not matter as much to you. Keep in mind that finance charges do not kick in unless you carry over a balance. If you pay in full, you do not incur finances charges which are based on the company APR.


For those who will be paying the full balance each month, consider a credit card that has a longer grace period and has no annual fees. This allows you to use the credit for little, if any, charge. Do keep in mind, however, that if you happen to lapse and carry a balance, you will have to pay the finance charges and then APR will matter to you.

Most people, however, do carry over a balance and for those individuals it is important to find the credit card that offers the lowest annual percentage rate (APR). The APR is the number that the credit card company will use to calculate your monthly finance charge so the lower this number the less money you will pay.

If you think that you may use your credit card to get cash advances, you will certainly want to look at the fees and charges for that service.

It is important to remember that many, if not most, of the credit card companies charge a higher rate for cash advances than they do for purchases. Some companies will charge a substantial amount more and you would do well to avoid using these cards for cash advance purposes.

Many people are lured into poor credit card choices by the promotions that many companies offer. These might include such things as frequent flyer miles, phone minutes, rebates and other things. There is nothing wrong with opting into these programs if they are benefits that you are going to actually use. The old adage that nothing is free applies here as well. Many of the companies that offer these promotions will have a slightly higher APR to help offset the cost of the programs. Make sure you look for that before you sign up, as it may not be in your best interest to pay higher rates for benefits that you will not use.

In order to find out what the APR and other fees are for any particular company, you can visit their website or you can look at the information that comes to you through the mail. Federal law requires that all solicitations and applications for credit cards include key information on the rates and fees that they charge consumers. This information must be clearly printed and if you have to hunt for it, then you may want to avoid dealing with that company.

Peter Kenny is a writer for The Thrifty Scot, please visit us at Credit Report and Credit Cards
Visit http://www.thriftyscot.co.uk

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