The worst credit card fees you are paying and how to avoid them

THESE are the unexpected credit card fees that you are unnecessarily wasting hundreds of dollars a year on.

CREDIT card customers are frittering away their money by paying unnecessary fees that can easily be avoided.

New data examining the spending habits of nearly 60,000 Australian card users across 4.1 million transactions was compiled Pocketbook, a ZipMoney company, and found many people are getting stung hard by fees.

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It showed annual fees are biting shoppers the worst ($87 per year), followed by international transaction fees, late payment fees ($38) and cash advance fees ($35).

Australians are wasting money on unnecessary credit card fees.

And in terms of total fee revenue financial institutions are making the most money from slugging consumers with international transaction fees (38 per cent of total fee revenue), followed by annual fees (34 per cent), cash advance fees (9 per cent) and late payment fees (8 per cent).

ZipMoney’s chief growth officer Andy Mitchell said international transaction fees have the most exorbitant charges and consumers needed to pay attention to these or risk paying too much.

International credit card fees are among the worst to hit consumers.

“International transaction fees are incurred in one of two situations, either Australian consumers are staying at home and buying goods from overseas or consumers here are travelling overseas and using card while over there,’’ he said.

“As a result they are incurring foreign currency conversion fees ... and some other peripheral fees they are incurring from the banks.”

Mr Mitchell urged consumers to monitor their statements and check what charges they are paying and take action if they are paying too much.

“By shopping around you’ll find a way to reduce the fees that fit into your behaviour,’’ he said.

There’s no denying Australians are addicted to their credit cards — latest Reserve Bank data shows cardholders owe a massive $52.3 billion on plastic and more than $32.3 billion is accruing interest.

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Consumer finance expert Heidi Armstrong said it’s vital card customers use their plastic wisely and are mindful of the charges they pay for the privilege of paying on credit.

Consumer finance expert Heidi Armstrong said fees can spiral out of control if you don’t pay attention.

“Fees can spiral out of control but so too can the interest,’’ she said.

“Before you open your statement try and guess what you are paying in fees and then compare that to the actual statement and many people might get a shock.”

@sophieelsworth

Originally published as The worst credit card fees you are paying and how to avoid them