Is it worth going for annual fee credit cards? - Other Questions

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Is it worth going for annual fee credit cards?

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Lately, banks have been offering a lot of freebies to consumers of all sorts. There was a time when long time consumers used to get a good deal in order to reward them for their loyalty and business. But now, in order to lure new consumers with a better buying power than their older peers, the banks have started offering attractive offers to all with sufficient income and savings.

One of the most popular concessions offered by banks is the no annual fee credit card. This has become so popular that it is no longer thought of as a concession but a given. And one can make substantial savings with no annual fee cards given that if you do not use the card, you do not pay. But there are some situations where you might want an annual fee to be included. We will now look at the reason why you would want to do this.

If you go for a no annual fee card, you might be agreeing for a higher rate of interest on the money borrowed. This is okay if you are using your credit card as a convenience and not as a necessity. If you are going to be using it to make essential purchases with no cash to pay back the borrowed amount within the given grace period, you will end up paying interest on the amount borrowed. Now this interest is not like a bank loan interest, the rates will be much higher than a conventional bank loan. And paying interest on credit card loans will only gradually make you end up in debt. but if you are going to pay all your dues on time every time, you need not worry about a no annual fee and higher interest rate credit card.

There are many additional perks that you will get with no annual fee credit cards. Getting a no annual fee credit card is a given these days. You need to ask for more and get it if you want to strike a good bargain with the bank. Earning sky miles is one of the latest additions to the repertoire of offers that banks give out. If you fly a lot, you can take advantage of this offer. But again a few banks will charge you a small fee annually in order to enroll you into the frequent flyer or fly miles program. Some banks will also provide points for every time that you swipe your card or you might get points as a percentage of the amount that you spend using your card.

In any case, you can use these points to buy articles at certain stores or you can also use it to redeem for cash. But if you redeem the points for cash, you will not get a better deal as you would get an article of higher value of you exchange the points at a client store. Some other cards will also offer you travel programs or vacation packages on reaching a certain stage with your card usage. Car rentals, hotel bookings, and birthday packages are other freebies that are offered by credit card companies.

All credit cards terms, fees and rates mentioned in this article/post are actual on the posting date. See the current products’ Terms & Conditions on the issuing banks' websites.
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