What to do When Your Credit Card Starts Charging Annual Fees Again
A number of credit card providers have started announcing that they will begin charging annual fees again in light of credit card reform that was announced earlier this year to limit shady credit card practices. Bank of America, the third largest credit card provider in the U.S., just announced yesterday that they were going to start charging annual fees.
Punishing the Responsible
The Bank of America accounts that will be charged fees were selected based on “risk and profitability,” which probably means that those of us who have been bad customers (i.e. we pay our bills on time) will get punished by getting charged with annual fees. No more free rewards points rides, my friends.
Taking your Stand Against Credit Card Fees
If you fall into this category with Bank of America or any of your credit card providers, I have one piece of advice: walk. Well, OK, maybe give them a chance to waive the fee ‘perpetually’, meaning that it is waived for you so long as you are a customer and you don’t have to mark on your calendar to call them back on a certain day every year. After all, you don’t want to toss away your solid credit history if you don’t have to.
If the card company does not waive their fees for you, there are a huge number of providers out there that will keep their fees at no charge. Just the threat of you leaving ’should’ be enough incentive for them to waive the fees. If it isn’t, tell them you plan on going into debt in grand fashion in the next few months.
If you can’t any providers that are more willing to accommodate (which I doubt will be the case), then it will be up to you to complete a cost/benefit analysis as to whether or not your annual rewards kickback is enough incentive for you to keep the card when compared to your annual fee.
You may also want to take a look at debit cards that are offering rewards, which are becoming much more common these days.
Frugalhead Discussion:
- Has your credit card provider announced that they will be re-instituting annual fees again?
- If they do, what are you going to do about it?
Want more free MicroFrugality tips?
I can’t believe that these companies are even considering this. There are so many other companies out there… Many other fishes in the sea.
Thanks for the heads up, GE, I was unaware that some of these companies were going to be Idiots!
Closing your card is certainly an option, but remember that every time you apply for new credit you leave a ‘footprint’ on your credit record, so you should always apply for new credit carefully, not willy nilly.
Great article though.
@ Allen – Did you expect anything less from the credit card industry?
@ FruGal – very good basic point that I didn’t hit on, but agreed.
@G.E. Miller: I expected them to behave in a manner that is good for future buisness as well as the bottom line for today… OH WAIT, I expected them to behave like ACTUAL Capitalists, not just short-term-gains idjits.
@FruGal: That IS a great point, well done!
Yes, we can change cards, but if they ALL start charging fees, there is nowhere to go. Don’t drop your old card before securing a new one first.
Leave a comment!
Get your Free MicroFrugal Fix!
Topics
Archives
Polls
Frugal Services & Products
Blogroll
Blogroll
Tag Cloud
text