2 Credit Card Late Fee Amounts Increased for 2020

Photo by fizkes / Shutterstock.com

From Medicare deductibles to cable TV bills, many fees rise over time. And credit card late fees are no exception.

In fact, federal law allows for certain credit card costs to change as often as annually.

For 2020, the threshold for the following credit card fees increased:

  • First late payment penalty: $29 — up from $28 in 2019
  • Subsequent late payment penalty: $40 — up from $39 in 2019

These changes took effect Jan. 1.

Just note that the above amounts are limitations: They represent the maximum amount that a credit card company can charge for such fees this year. So, it’s possible that your credit card company won’t hike the amount it charges for these fees in 2020.

Why credit card fees rise

Under federal law, the U.S. Consumer Financial Protection Bureau (CFPB) calculates credit card late fee limits annually based on the Consumer Price Index, which serves as a measure of inflation.

So, late fee limits can change as often as every year.

These limits apply to open-end consumer credit accounts, not credit accounts that are secured by a home.

Avoiding credit card late fees

The only surefire way to avoid credit card late fees is to quit using credit cards — an impractical solution for many consumers.

The best practical preventive measure, then, is probably to set up automatic payments.

You should be able to do that by logging in to your account online. But if you can’t figure it out, contact your credit card company’s customer service department.

When I log in to my credit card account, for example, I can choose one of three amounts to be paid automatically every month on my bill’s due date: the minimum payment, the statement balance or a dollar amount of my choice. Choosing even the minimum payment would be sufficient to avoid late fees.

Paying anything less than the full balance, however, generally results in interest charges. If you aren’t paying your credit card bills in full each month, you might want to consider transferring the balances to a no-interest credit card.

You can find and compare such cards using a free online resource like Money Talks News’ credit card search tool. Or, simply check out “3 Great 0% Interest Credit Cards for Ringing in 2020.”

If you ever incur a late payment fee or other credit card fee, ask your credit card company if it will waive the fee. A 2019 CompareCards survey found that among cardholders who had asked for a waiver of a late payment fee, 87% received it.

What’s your take on the rising thresholds for credit card late payment fees? Sound off below or on our Facebook page.

Disclosure: The information you read here is always objective. However, we sometimes receive compensation when you click links within our stories.

Read Next
How to Invest in Real Estate for as Little as $500
How to Invest in Real Estate for as Little as $500

If stock market volatility has you looking for other investment options, here’s a way to diversify — even if you don’t have tons of money.

3 Reasons You Can’t Rely on Medicare Alone
3 Reasons You Can’t Rely on Medicare Alone

Counting on Medicare to cover health care costs can jeopardize your retirement plans.

8 Things I Always Buy at Target
8 Things I Always Buy at Target

I grew up shopping at the original Target store and am a lifelong fan. Here are my favorite purchases.

5 States With the Worst Health Care for Retirees
5 States With the Worst Health Care for Retirees

All of these states are located in the same region of the nation.

9 Purchases That Will Make You More Productive
9 Purchases That Will Make You More Productive

These Amazon products can give you an extra edge at work and other parts of your life.

View this page without ads

Help us produce more money-saving articles and videos by subscribing to a membership.

Get Started

Most Popular
7 Kirkland Signature Items to Avoid at Costco
7 Kirkland Signature Items to Avoid at Costco

Even if it seems you save a bundle buying Costco’s Kirkland Signature brand products, they may not be the bargain they appear to be.

How to Buy Gas At Costco Without a Membership
How to Buy Gas At Costco Without a Membership

The warehouse club often has some of the cheapest gas in town. Here’s how you can get it as a nonmember.

10 Things to Stop Buying If You Want a Clutter-Free Home
10 Things to Stop Buying If You Want a Clutter-Free Home

If you like to keep things simple, avoid these purchases.

A Simple Way to Silence Robocalls Today
A Simple Way to Silence Robocalls Today

A few steps can keep your phone from ringing when a spammer calls.

Prices Are Soaring on These 7 Items
Prices Are Soaring on These 7 Items

Some surprise price jumps are making life more difficult for consumers.

This Company Makes the Best Tires in America
This Company Makes the Best Tires in America

Driver satisfaction with tires is at an all-time high, but one brand stands out.

If You Find This Thrift Shopping, Buy It
If You Find This Thrift Shopping, Buy It

This iconic dinnerware is prized for everyday use as well as reselling for profit.

This Health Issue Can Hint at Dementia Years in Advance
This Health Issue Can Hint at Dementia Years in Advance

One type of pain is especially associated with cognitive decline.

Can I Switch to Spousal Social Security Benefits When My Ex Dies?
Can I Switch to Spousal Social Security Benefits When My Ex Dies?

Knowing when to claim can help you maximize benefits.

Medicare Will Not Cover These 6 Medical Costs
Medicare Will Not Cover These 6 Medical Costs

Don’t let these health care expenses catch you off guard in retirement.

8 Things You Should Always Buy on Amazon
8 Things You Should Always Buy on Amazon

The giant retailer shines when it comes to these things, from basics to hard-to-find specialty goods.

Beware This Hidden Ingredient in Rotisserie Chicken
Beware This Hidden Ingredient in Rotisserie Chicken

Something foul may lurk in those delicious, ready-to-eat birds.

5 Ways to Get Amazon Prime for Free
5 Ways to Get Amazon Prime for Free

Hesitant to drop $119 a year on an Amazon Prime membership? Here’s how to get it for free.

7 Home Improvements That Cost a Lot More in 2021
7 Home Improvements That Cost a Lot More in 2021

These projects will take a bigger bite out of your budget than in the recent past.

5 Ways to Fill Your Pantry With Free Food
5 Ways to Fill Your Pantry With Free Food

Anyone can take advantage of these resources.

7 Big Purchases You Should Never Make
7 Big Purchases You Should Never Make

Sometimes a big-ticket purchase is nothing more than a big waste of money.

3 Ways to Get Microsoft Office for Free
3 Ways to Get Microsoft Office for Free

With a little ingenuity, you can cut Office costs to zero.

6 Reasons You Should Stop Hiding Cash at Home
6 Reasons You Should Stop Hiding Cash at Home

Stashing money around the house is anything but harmless.

5 Products You Should Never Buy Generic
5 Products You Should Never Buy Generic

Sometimes the brand-name version is clearly superior.

View More Articles

View this page without ads

Help us produce more money-saving articles and videos by subscribing to a membership.

Get Started

Add a Comment

Our Policy: We welcome relevant and respectful comments in order to foster healthy and informative discussions. All other comments may be removed. Comments with links are automatically held for moderation.