In the effort of saving a few dollars, credit card seekers usually look for credit cards with no annual fee. From their point of view, this gives them a chance to be spared from additional fees that are charged on top of the interest rates and monthly finance charges.

An annual fee is different from an annual percentage rate or APR. Credit card annual fees are usually fixed amount charged to your credit card every year. Think of it as a fee for having the privilege of using the credit card. The annual percentage rate (APR) on the other hand describes the interest rate applied to the credit card for a whole year (annualized) rather than a monthly rate.

When speaking of credit card with no annual fees, you have to consider more aspects. Currently, there is much competition among credit card issuers. Banks and credit card companies device certain promos and combinations to make their product more complete and enticing in the eyes of the customers. Typical arrangements include low interest rates, waived annual fees, more rewards and a lot more. They come up with certain combinations that would look beneficial from a customer perspective, but without letting themselves lose too much dollars.

One sample combination is a credit card that has low APR and without annual fee. Others would offer something with a fixed annual fee of $100, but without any other charges. The point is that you have to scrutinize the details of the offer for you to know which one best fits your needs. You need to consider things such as:

The facts presented by the card – interest rate, annual fee, other charges, etc.
The period when these features can be used – some would only allow these for 6 or 12 months)
The features attached to the card – rewards, miles, points and other promos
An estimate of your monthly expenses – if you plan to spend a lot using your card, you have a risk of running into more debt if you erroneously choose a card with high interest rate

Note that most credit card companies that offer no annual fee only offer this feature for a limited period. Whether these credit cards are secured or unsecured credit card, a Visa or MasterCard, most of them waive the annual fee only during the first year. Regular charges will be imposed in the succeeding years. However, there are some companies that would allow their annual fees be waived if personally requested by the cardholder. This has been experienced by some credit card owners, and wouldn’t hurt if you try to ask for it. They may have certain criteria before they do so, but it’s worth the try asking.

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