Being an avid reader of personal finance blogs/websites for the last year or two, I’v noticed that there are two schools of thought when it comes to credit cards. Those who say credit cards are pure evil and avoid them at all cost, and those who embrace credit cards and use them to play the rewards game.
I’m in neither of these camps.
I definitely don’t avoid using credit cards. Not because I don’t think they are dangerous – they certainly could be in the wrong hands – but because they are very convenient. I use credit cards more that I use cash. However, I only use credit cards when I know I have the cash to pay for whatever I buy.
For example. I budget $150 for groceries per month, but instead of paying cash when I go food shopping, I pay with my credit card. I know I can’t spend more than $150 because then I’ll go over budget. At the end of the month, I take the $150 that are in my bank and pay off the credit card.
This allows me to not have to carry cash all the time and also earn some rewards.
Now, I like earning rewards, but I don’t play the rewards game. The game where you sign up for 10 or 20 credit cards and spend X amount of dollars a month to get X number of points. I’m impressed by the people who are able to do this, but I’m just not one of these people.
I spend what’s in my budget and if I get rewards then cool, and if I don’t get rewards then also cool. I don’t try to manufacture spending to claim rewards… or maybe not yet.
Why I Don’t Want More Credit Cards
The reason I don’t play the rewards game is because I just don’t want any more credit cards. I got out of debt not too long ago and I’m still trying to arrange my whole financial situation. I have way too many things to keep track of and having more credit cards will make it more difficult.
The reason I’m telling you this is because I pay annual fees in the few credit cards that I have… There I said it!
I could just apply for new credit cards with no annual fees, but I don’t want to cancel the ones I have because of two things:
- They were the only ones who gave me a credit card when I had terrible credit.
- The age of credit history will be affected on my credit score.
I know these are the stupidest reasons not to cancel the cards, but those are my reasons and I’m sticking with them… for now.
As you can see, getting a credit card with no annual fee will not help me because I will still keep my old credit cards. It will just mean that I have more credit cards.
How To Avoid Credit Card Annual Fees
One way to avoid credit card fees is to not have credit cards at all – gee thanks, Captain Obvious. Another way is to get a credit card with no annual fees – really? As if I couldn’t figure that out. A third way you could avoid credit card annual fees – and the way I do it – is by asking politely to get the fees waived.
The third way – asking politely – might be a little tricky, but it is definitely doable.
In the past, I never tried to get the fees waived because I was just happy to be able to have a credit card. I always assumed that was the price I had to pay for having bad credit.
My credit is very good now, but I was still paying fees and since I’m trying to cut as many expenses as possible, I decided to give my credit card company a call.
The first time I called (last year) the costumer service representative told me there was nothing the could do because I had already paid the bill. But he told me to call as soon as the next annual fee appeared on the bill and they could waive it.
Fast forward twelve months – more like eleven – and the annual fee appeared again on my bill. I picked up the phone right away and called my credit card company. Sure enough, they waived my annual fee and said it would be good for 12 months, but that I could call back in 12 months to see what they could do about it.
That works for me… for now.
Different Company, Different Policy
Not all credit card companies are the same so I recommend you call your credit card company and ask them if there’s anything they could do about the annual fee – if you have one.
A simple phone call should do the trick. Something as simple as “Hello, I would like to have my annual fee removed.” That’s all it takes.
Some companies, like mine, may ask you to call on the month when your fee was posted, but others might do it right on the spot. Make sure you call right away and find out what your company’s policy is.
It doesn’t hurt to ask. The worst that can happen is they say “No.” But what if they say “Okay, we’ll waive the annual fee. Is there anything else we can do for you?”
How do you avoid annual fees?