Definition
An annual fee is a fee charged to a credit cardholder simply for the right to use the credit card. The annual fee is usually charged once a year, for every year that the credit card account is open, regardless of if the cardholder uses the card and whether or not a balance is carried on the account.
Analysis
Annual fees generally range from $0 to $300, and are usually charged to the cardholders credit card balance. It is important to consider the annual fee when evaluating offers and choosing a credit card. A card with high annual fee can be costly even if you do not carry a balance on your card and are not subject to finance charges. Most consumers should be able to obtain credit cards with no annual fee. The fees are most common for cards that offer rewards benefits and for credit cards aimed at consumers with poor credit.
