A no annual fee credit card seems like an obvious and easy way to save money. It is a great option for people who use their credit card infrequently. No annual fee credit cards should be considered by people who can’t remember the last time they used their credit card.
So what exactly is a no annual fee credit card?
A no annual fee credit card is a card that does not charge an administration fee. These credit cards can be money saving cards for the right kind of credit card user but a terrible trap for the wrong kind of credit card user.
Who offers no annual fee credit cards?
No annual fee credit cards are offered by banks, building societies and credit unions and sometimes non financial lenders as a way of attracting new credit card customers.
Can I get an instant approval no annual fee credit card?
If a lender is offering instant approval credit cardswith no annual fee, one would be best advised to read the fine print carefully and compare the card to others available. A quick approval process with an added bonus of no annual fee sounds a lot like something that’s too good to be true. This may or may not be the case, but remember lenders always intend to make money with credit cards whether or not they have an annual fee.
What should I look out for in a no annual fee credit card?
A credit card lender offering a no annual fee credit card will generally apply a higher rate of interest to the credit card with no annual fee, than other cards on offer. The difference is not neccessarily great. In many cases when there is little or no interest carried over each month then the saving on the credit card will still outweigh the annual fee that would otherwise be charged.
A credit card issuer may gain by offering a no annual fee credit card by lessening the interest free days to something like 44 days or in some cases, providing no interest free days at all. It is important to remember that grace periods (interest free days) are really of little or no consequence if the balance is always paid off quickly by way off an automatic payment of the balance for example.
Regular readers will know that we recommend all consumers do a credit card comparison of the cards available before applying for any credit card. It is important to consider carefully they way in which the card will be used in order to get the right credit card for you. If there is a chance that you will carry a balance on your credit card the terms and conditions will need to be considered carefully. In these cases a low interest credit card with an annual fee is usually a better option than a no annual fee credit card.
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