Answer: $29 (as of 1/1/20)
- What do you think are some of the reasons that people pay their credit card late?
- Do you think it’s worthwhile to call the credit card company to try and get this fee waived?
- Some credit card companies are now allowing cardholders to skip a payment. Do you think this is a good idea? Why or why not?
Behind the numbers (The Balance)
The law limits how much credit card issuers can charge for a late fee. As of Jan. 1, 2020, issuers can charge up to $29 the first time you’re late or up to $40 if you’ve been late on your payment more than once within the previous six months. (The 2019 maximums were $1 less.) Furthermore, the late fee can’t exceed the amount of the violation.4 For example, if you were late on a $10 minimum payment, your late fee can’t be higher than $10.
About the Author
Tim’s saving habits started at seven when a neighbor with a broken hip gave him a dog walking job. Her recovery, which took almost a year, resulted in Tim getting to know the bank tellers quite well (and accumulating a savings account balance of over $300!). His recent entrepreneurial adventures have included driving a shredding truck, analyzing executive compensation packages for Fortune 500 companies and helping families make better college financing decisions. After volunteering in 2010 to create and teach a personal finance program at Eastside College Prep in East Palo Alto, Tim saw firsthand the impact of an engaging and activity-based curriculum, which inspired him to start a new non-profit, Next Gen Personal Finance.