Foreign transaction fees can snag more money from when you make purchases abroad, adding as much as 3% to the cost of your purchase.

That American Express, Discover, Visa or MasterCard that has served you well for so many years could prove more costly to you if you were to use it outside of the United States. Unless you regularly travel abroad and use a credit card you may not be aware that foreign fees usually kick in for each time your card is swiped.

Foreign Currency Transaction Fees

A recent report published in The Wall Street Journal has revealed that banks are now boosting foreign fees or in some cases are introducing them for the first time. New Fees For Card Usage Abroad discusses the trend, noting that Discover Financial Services began charging a fee this month, adding 2% to every foreign transaction.

On the surface, fees may not sound like a lot, but they do add up. For example, if you are planning a trip overseas and are paying for some of your expenses while abroad, then you can incur a fee. Thus, if you plan to travel to let’s say Germany and you wait until you arrive to book your hotel room, you could be charged a fee which covers converting foreign currency into dollars. However, if you make your hotel reservation while still in the states, you may be able to avoid that fee — as long as you are charged in American dollars in the first place.

In Some Cases, No Foreign Transactions Are Exempt

But even credit card providers are seeing that money can be made by charging customers for any type of foreign transaction no matter what the fee charged. These fees vary, not every card charges them, but for those who do that can range from two to three percent of the bill. Take a ten day family excursion to Italy costing you $8000 and that surcharge could add $240 to your final bill.

Of course, you can avoid foreign transaction fees by using a credit card that doesn’t charge fees such as Charles Schwab or Capital One.  Some cards, such as Discover and American Express, aren’t as widely accepted overseas as they are in the states. So, shop for a card that has near universal reach and doesn’t charge transaction fees.

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Here’s something new: The Wall Street Journal (WSJ) published an article in yesterday’s edition titled, “AmEx Encourages Cardholders to Leave,” where they reported that American Express was offering select customers an incentive to pay off their balances and cancel their accounts. That incentive is in the form of a $300 AmEx prepaid gift card, usable wherever American Express cards are accepted.

America’s Mailboxes Catch A Break

The move by American Express is a surprising one, especially considering that as recently as a year earlier all of the major credit card networks were sending out offers right and left. That practice, which had been going on for many years, seems to have passed. Today, credit car providers are cutting credit lines, canceling accounts and, in the case of AmEx, offering an amicable divorce.

In the WSJ article, written by Mary Pilon, she noted that the card issuers are seeing a spike in defaults as the recession deepens. Worried that they might be over run with bad debt, issuers are taking unusual steps to make sure that higher risk customers are shown the door. For the record, American Express isn’t saying much about who is receiving their offer letters.

Customers who receive a letter have until February 28th to decide whether they’ll accept American Express’ offer or not. If they do, they’ll use a special RSVP code that when submitted online cancels their membership on the spot. They then have from March 1st to April 30th to pay off their balances and receive their prepaid card.

Closing An Account Has Its Drawbacks

If you receive such a notice from AmEx and are considering closing your account, there are a few things to keep in mind:

• If you don’t use your membership reward points before closing your account, then you’ll lose them. Use up your points now, agree to the offer once they have been redeemed.

• Your credit score will take a hit.  The way your credit score is calculated, closing an account even with an enticing offer dangled before your eyes from American Express, can lower your credit score at least temporarily. This means that if you plan on applying for additional credit later on, your terms could be less favorable. Who knows, but you may end up paying far more than $300 in interest for a mortgage, wiping out the worth of the AmEx prepaid card.

Be On The Look Out

If you don’t have an American Express card, your credit card issuer could offer to you a similar incentive to leave.  Regardless, all consumers need to be watchful for fee increases and higher interest rates, as issuers attempt to maintain profits in a down economy.

Adv. — Have you checked your credit report lately? How about your FICO score? As a consumer, you need to be on top of your credit history, checking for errors and making certain that the information in your consumer credit reports is accurate. Employers, banks, mortgage companies and other lenders base your credibility on a three digit score. Avoid surprises — check your credit report today!

How many credit cards do you carry? 2? 5? 11? If you were to add up all of your store cards, gas cards and your MasterCard, VISA, American Express, Discover and other national cards, you might be surprised at that number. Then again, maybe you have several cards but are considering finding a new card, one with a special deal not offered by your current card issuer.

Compare Credit Card Offers

You probably already know this, but not all credit card offers are the same with some offering high rates and absolutely no rewards to others which will can provide for you a low, fixed rate and special rewards. Before you shop for your next card, let’s review the variety of credit card choices out there for your consideration.

Low Interest Rate Credit Cards — Higher interest rates have made these cars a bit less common, but there are still credit cards available with low rates, even 0% financing for balance transfers. In most cases, these special rates are in place until the transfers are paid off with newer purchases charged at a higher rate.

Low Introductory Rate Credit Cards — To entice you to use a particular credit card, some credit card issuers will offer to you a special “teaser rate” that will run for a number of months, usually for as long as six to twelve months. You can make purchases at the very low rate (let’s say 2.9% for twelve months) and then pay 12.9% or more on balances after that time. These cards can be a great way for consumers to make an expensive purchase and paying off their balance over a few months time without incurring a lot interest charges.

Pre-paid Credit Cards — Consumers who have bad credit as well as students who are off to college, a pre-paid credit card allows people to build up their credit rating while still having the convenience of shopping with a credit card. No need to carry around a lot of cash, if you misplace the card you haven’t lost your money and can get a new card.

Rebate Credit Cards — Use your credit card and get paid for using it! This may sound like a scam, but it isn’t: some credit card providers will give you cash rebates on certain purchases. Spend $500 and you could have $10 credited to your account, depending on the offer.

Award Credit Cards — Also known as rewards cards, an award card works like a rebate credit card: you get to select gifts based on points you have accumulated with your purchases. In many cases, one point is awarded for every dollar spent and you can redeem those points online or through a catalog sent by the credit card company. Some issuers will automatically give you 500 or more points with your initial purchase, even throwing in a bonus offer through special promotions which can double or even triple your points during a special promotional period (for example, the holiday shopping season).

Other Special Card Deals Too

The previously mentioned credit cards choices are typically MasterCard or VISA network special offer credit cards, but American Express and Discover have deals which may be worth a look too. Manage your various rebate cards with this free download to help you get the rebates and rewards coming to you.

Credit cards are the backbone of the financing industry, driving profits to those institutions who manage their programs well. Competition for customers is fierce and, although consumers typically hold 4, 6, even 8 or more cards, getting them to use one card more than the rest is where profits can be found.

It doesn’t hurt that you run a monthly balance either, for the credit card issuer that is.

One of the most popular lures of credit card issuers are “rewards cards” those credit cards which offer incentives when used. Airline affinity cards were some of the earlier and most popular rewards cards created, but today that category has expanded as issuers contrive different ways to hook customers.

While some consumers still like to accumulate airline miles which can be used toward free flights, upgrades, even hotel stays and car rentals, their popularity has decreased over time. Airlines have made it more difficult to redeem accumulated points and points tend to expire faster than they can be redeemed.

Perhaps the best rewards card out there is the one you can tailor to your specific needs. These cards offer cash back or points toward other rewards, which typically include household items, sporting equipment, hotel stays, restaurant meals, etc. But, the rewards card game only becomes worth playing when you keep the following “rules” in mind:

No fees, no expenses, no monthly balances — Rewards cards should be obtained for free, with no annual fees, and they must be paid off monthly in order to reap the benefit of having one. As most rewards cards charge a high interest rate, carrying balances will serve to cancel out the benefit of accumulating points.

Free points — Oftentimes, to sweeten the deal, a credit card issuer will deposit a large sum of points in your account following the first time you use the card. This means that if you charge your breakfast at McDonald’s, you could be rewarded with an extra 2500, 5000, or even 10,000 points by using the card. From the start, you probably already have enough points to get a free gift, but resist that temptation and keep on accumulating for bigger and better things.

Cash in before they expire — Cards with points that never expire are a rarity as many programs start to remove points after two or three years time. Keep track of your points and save up for the bigger ticket items or cash rewards when you patiently wait to hit the next plateau. Many issuers offer further incentives if you keep accumulating; just don’t lose sight of those points which could start expiring if you wait too long.

Compare offers — Not all offers are the same, though most will pay one to three cents (points) for every dollar spent. Some will pay up to five points on select purchases, such as gas station fill ups, pharmacy visits, and grocery store purchases.

What is the best way to play the game? Answer: familiarize yourself with the credit card issuer’s rewards programs including the occasional program changes which are included with your monthly statement. Look for monthly specials too as that is one way for issuers to move discontinued or slow redeeming merchandise.

You can play the rewards card game and win: just follow the rules and you could score big!

How many credit cards do you carry? 1, 5, 10, maybe more? Most consumers carry at least one credit card, especialy when you include department store cards, gas station cards, American Express, MasterCard, VISA, Diners, Discover and others. Consumer lending is big business, an area of marketing that lenders use to fuel their businesses.

You probably already know that not all credit cards are alike. Some offer low rates and decent rewards while others charge higher than industry rates and offer no incentives. Likely, most of the cards you have seen fall somewhere in between.

Maybe you have considered getting a new card recently. If so, let’s take a look at some of the popular credit card offers available today:

Low (or Zero) Percentage Rate Credit Cards — Lending rates remain low and there are still credit cards available with low rates, even 0% financing for balance transfers. Typically, these special rates are in place until the transfers are paid off; new purchases are usually charged at a higher rate.

Teaser Rate Credit Cards — To get you to use a new card, some lenders will offer you a special “teaser rate” that will run for several months, usually for as long as six months perhaps for a year. Purchases can be made at a very low rate (let’s say 3.9% for twelve months) and then rise to 15.9% or higher later on. These cards are popular with consumers who want to purchase an expensive item and pay it off over several months without incurring high interest charges.

Rebate Credit Cards — Make your credit card work for you! If this sounds like a marketing ploy, it isn’t: certain credit card providers will give you cash rebates on select purchases. For example,if you spend $2000 you could have $20 or $40 credited to your account — see each offer for specific details.

Award Credit Cards — Also known as rewards cards, an award card works like a rebate credit card: you get to choose prizes based on the number of points you have accumulated with your purchases. Usually, one point is awarded for every dollar spent and you can redeem those points online or through a prize catalog provided by the credit card company.

Pre-paid Credit Cards — For the consumer with bad credit or for students who at college, a pre-paid credit card allows holders to build up their credit while still having access to plastic. You don’t have to worry about carrying around a lot of money; if your car is lost or stolen you can replace it.

Many of the card deals mentioned are for MasterCard or VISA cards, but Discover and American Express have special offers which might be of interest to you too.

You’ve just moved into your new home and the welcome shower given by family members and friends yielded some very desirable gifts. A tiffany lamp, garden tools, and a food basket were some of the favorite items received, gifts that will come in handy immediately.

Along with the usual gift items you also received several gift cards, those plastic credit card-sized “financial instruments” that allow you to purchase what you want for your home and when you want it. But, before you stash those cards in a drawer thinking that you’ll use them at a later date, you’ll want to use them up as soon as possible. If you don’t they could be worth less or worthless.

Sorry, Your Card Has Expired

Some gift cards expire after a certain amount of time while others are worthless because the merchant went bankrupt. Do you think that this will not happen to you? Think again!

The Sharper Image Goes Bankrupt; You Lose

Recently, specialty retailer Sharper Image filed for bankruptcy, with a plan to restructure the company after just over half of its 184 stores have been closed down. Initially, the company also said that they would not honor outstanding gift cards, effectively rendering these cards worthless.

Earlier this week, Sharper Image amended their policy to allow shoppers to use their cards as long as they spent twice the card’s value and they used the card all at once. In essence, in order to recover the value of the gift card, you would still have to pay out of your pocket at least an equal amount of money to use your card.

Monthly Fees Can Kill Your Card

Sharper Image isn’t the only company with restrictions on gift cards. Some companies will automatically expire their cards after a certain amount of time — typically, one year — but in some cases the cards really haven’t expired. You’ll just have to pay a monthly fee which will drain the balance over the next year. Most retailers do not have such policies but the credit card companies — Visa, MasterCard, Discover and American Express do.

Use It or Lose It

The best advice when it comes to gift cards? Use them immediately. Even if there aren’t monthly fees charged after one year or your card never expires, the longer you put off using the card, the greater the chance you will forget about the card or lose it.

It is a fact: not all credit cards are created equally. Some credit card providers charge annual fees, others offer low introductory rates, while some offer rewards every time that you use them. Confusing, isn’t it? We think so! With this in mind, SayEducate offers the following tips to help you navigate through the credit card maze.

When comparing credit card offers, even having a master’s degree in business administration will not ensure that you will understand every single offer. The language used by credit card providers is often confusing, even nonsensical with enough small print qualifiers to give anyone a headache.

So, why should you consider a new credit card in 2008? Well, if you have received you most recent credit card statements, it likely reflects the spending you did for Christmas. For some consumers, the shock of a January credit card statement can put them into a panic forcing them to scramble to find the money to pay their bill. Sure, making minimum monthly payments can buy you some time, but you know how that goes — you’ll never get the card completely paid off before the next important holiday or event comes up.

Comparing offers can get complicated, but the following should be considered whenever you apply for a new credit card:

Annual Fee — unless your credit isn’t good or excellent, then paying an annual fee makes no sense. Yes, American Express and some other elite cards will charge a fee, but these fees are usually offset by some special services including travel insurance, concierge services and the like.

Interest Rate — if you pay off your card every month, then it doesn’t matter what the interest rate is for you. For everyone carrying monthly balances, the lower your interest rate, the better. Lots of cards offer teaser balance transfer rates as low as 0% for the first three to twelve months, with a higher rate offered for new purchases.

Rewards — if you pay off your card monthly, then shopping for a card that offers rewards is the way to go. Some will give one or two percent cash back on your purchases, while others will allow you to accumulate points which you can redeem for gifts.

With any card you choose there are some things you should be aware of:

• What is the default rate on your card should you be late with a payment?

• If you run into a problem with an unrelated company (a dispute with the telephone company, for example) will your credit issue with that company automatically cause you to be charged the default rate?

• What fees are involved when transferring balances from one credit card to another one? Usually, that rate is as much as 3% of the balance, so do the math to see if transferring balances makes financial sense.

• Are you planning to apply for more than one card? If so, be careful! Multiple credit card applications can work against your creditworthiness. Your credit score can take a hit and impact the rate you pay for other loans.

• Make certain that you understand the terms of your consumer agreement. Most credit card providers reserve the right to change the terms of your agreement at any time — you could be in for a rude awakening when you suddenly realize that you are being charged a higher rate on balances!

Shopping for a new card means you should be very careful which card that you use. If the card you select doesn’t live up to your expectations, then contact the credit card provider and cancel it immediately. An unused card can work against you if it has been activated, but not canceled by you.