No Annual Fee Credit Card

Some credit cards will charge at low annual fee for the privilege of carrying their card. This fee that the charge is typically $100 per year. These credits cards also provide a number of services that you will not find on another cards. For example car insurance, travel insurance, points that you can use when they accumulate to pay for trips and other goods that you purchase.

These cards can be quite valuable based on the services that they provide. However if you do not use the services and are still paying the annual fee charged by these cards then this is an additional cost that many people should try not to pay for.

Evaluate Your Credit Card Benefits

If you travel a great deal and avoid having to purchase travel insurance, additional car insurance, and other types of services that are provided on this card then the annual fee can be quite valuable. If on the other hand you do not use these services then the annual fee is just another fee and that you are not getting any value from.

No Annual Fee Credit Card

Some of these credit cards that charge an annual fee, also provide low interest-rate loans based on the unpaid balance. Again one has to check to make sure that the Interest rate is competitive with a personal loan to make it worthwhile.

If the credit card that you have is charging you $100 a year just to use it as an annual fee, some people might feel that it is worthwhile just to have that card with you in case you need it. They think of it as an insurance policy in case they have a large purchase that they need to place on it. While this can be a worthwhile reason, it still comes down to the question, Are you receiving your money’s worth from this credit card.

One way to look at it is whether you will receive $100 in benefits of some kind each year. If you are at least using these benefits in whatever form the are, then it is probably a good idea to keep the card, other wise it is time to get rid of it and save yourself $100 a year. Another benefit of getting rid of the credit card and by getting rid of it we mean close the account is that your credit rating will also improve. This is one less potential debt that is not listed against your name and will improve your overall credit rating.

Something to think about. For more information about the use of credit cards, click here.