I’ll be honest that when it comes to credit cards I only know a few specific things. Regarding the more intricate details I am blissfully ignorant (and plan to stay that way!). There are some folks out there who are all excited (or disappointed) by the new Credit CARD Act of 2009. There is a buzz about all the new legislation and the impact on consumers. Honestly, I’m glad someone is keeping up with all of that information, but honestly I don’t really care. I don’t care because the changes are essentially meaningless to someone who pays off their balance every month.
For context here are some of my personal credit card statistics:
- I got my first credit card when I was a freshman in college. Yes, I signed up for the card to get a free T-shirt. I didn’t use the card for about three years until I needed to make an online payment.
- In about a dozen years of using a credit card I have never paid a penny in additional fees. However, I have come to believe that I did pay some convenience fees because I believe that I spend more with credit than cash.
- I have paid some consumer costs for using my credit card. For example I once signed up for a service that I did not know was a fee based service. By the time I saw the charge on my bill I was out $60.00.
- Due to an accounting error I was late for a payment once. I called the credit card company and they reversed all the fees and interest charges. That was a close one, but I still have my no fees streak!
- I currently have three credit cards. One I use to take advantage of 0% foreign exchange purchases overseas, one that earns points with Starwood Hotels, one that we have to keep activity on a points based earning program.
Five Credit Card Features I Don’t Care About
Honestly I have no idea what the interest rates are on my credit cards. I never have known. The reason is simple. I pay off my balance every month. In probably about 15 years since I got my first card and I have never had to pay a penny in finance fees. Who cares what the interest rate is? It only impacts you if you don’t pay off your balance.
Here’s what I do – when I get an email notification that I have a bill due I get online and pay off the bill. Once again I have no idea what the grace period is on any of my cards. I could probably find out, but I don’t care. Sure I could wait and pay it off closer to the due date and save those few pennies in interest, but I find a lot of those technical plans end up backfiring.
When you never have a late fee they could set it at $19 or $49 and it doesn’t matter.
Cash Advance Fees
I couldn’t even begin to tell you anything about these fees. I think it is charged as a certain percentage of the advance, but I’m not sure if you also pay a one time fee. Once again, it doesn’t really matter to me what my cards charge for cash advance because I don’t do it.
I don’t know how my minimum payments are calculated. I don’t know how my interest rate is determined. I don’t even know what other actions might incur fees.
Five Credit Card Features I Take Into Account
I like taking advantage of getting a little extra something out of my purchases. It makes me feel sophisticated. I figure if I’m going to slide a piece of plastic at the gas station I might as well be getting a little bonus.
Foreign Exchange fees
Because I spend more time outside of the USA than inside those boarders it is important for me to know how much each company charges when I use the card overseas. If you use your credit card overseas you need to know how it compares with other 0% foreign exchange credit cards. FYI two great options are Capital One and Schwab.
In my years of being a credit card user I have never paid an annual fee for a credit card. I am actually considering paying a fee for one, but I will let you know about that in a future post. Nevertheless, with a bazillion credit card options out there paying a fee for a card typically does not make much sense.
The Bill Total and Due Date
How to close an account
If a credit card company want to mess around with my fees, lie to me, or generally annoy me I have no problem closing an account. I have closed more than my fair share in my life time and I am not afraid to do it again.
What Credit Care Features Should You Care About?
I should point out that these are the things that I care about and I don’t care about, but your list will be different. Your credit card knowledge should be personalized based on usage or experience. Furthermore, your very usage of credit cards should be based on your historical ability to handle them responsibly. For example, if you have interest payments you should care about the interest rate. If, on the other hand, you never leave the country you don’t need to be concerned about the foreign exchange fee.
Photo Credit: Photo by ohadweb.
What credit card features are important to you?