4 Credit Card Fees Other Than Interest To Watch Out For

This article originally appeared on the Motley Fool.

To say America runs on credit would probably be an understatement.

According to recently released data, the amount Americans owed on their credit cards topped $1 trillion, inlcuding student loans and auto loans. This works out to an average monthly balance of approximately $9,600 owed by people who don’t pay off their credit cards in full each month.

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Furthermore, Ben Woolsey of CreditCards.com found in 2016 that a credit card holder making only minimum payments would be paying out nearly $1,200 a year in interest expenses — and this figure has likely gone up given that the Federal Reserve has raised its federal funds target rate by 25 basis points three times over the past six months.

Is your credit card costing you money (beyond traditional interest charges)?

Used properly, a credit card can be a valuable asset that makes larger purchases more affordable. It can also be a means to improve your credit score over the long run, which can have a number of positive financial effects.

But when used improperly, or when you don’t understand the ins and outs of using a credit card, your access to credit could wind up costing you money in surprising ways. Excluding the most obvious way a credit card costs you money — the interest you pay on any outstanding month-to-month balance — here are some lesser-known costs you should be aware of.

1. Annual fees

While there are numerous credit cards you can apply for that have no annual fees attached, an increasing number of reward-based credit cards are passing along an annual fee to their customers. This fee, for top-tier rewards cards and consumers with excellent credit scores, can range from $395 to $550 a year. This means consumers really have to decide if the perks they’ll receive are worth the added annual fee of using a rewards credit card.

What’s more, consumers can sometimes be baited into spending more than they otherwise would…

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