9 December 2021
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Take the credit

Maureen Jordan
12 November 2009

While Australians were experiencing the coldest October on record for many years, I spent the month parading around France and Germany enjoying a mild autumn.

Strolling around Berlin in an area that once was part of the east, I suddenly found myself lost and slightly panicking. My mind was eased recalling my daughter in law’s wise words on my departure:

“Remember, being lost is not an issue as long as you have your credit card close at hand.”

I felt inside my wallet and there it was — my synthetic serotonin.

Suddenly I found my way straight into KaDeWe, the biggest department store on the European continent, located on the Kurfurstendamm in the Charlottenburg district of Berlin. And it was there that my trusty piece of fantastic plastic did its first piece of damage.

Now don’t get me wrong. On the plane on the way over I watched Confessions of a Shopaholic and I’m not an addict. And coming home with the odd stunning bespoke outfit carefully crafted by a Berliner gives me immense joy – it’s part of the reason I work hard. And I wasn’t aghast on returning home to see my credit card statement, as I was completely cognisant with every purchase. But here’s the rub: I took up a new credit card just before I left and I didn’t read the fine print, which no doubt would have explained there was an international transaction fee with every purchase. And it was a percentage of the price of the item!

I knew the credit card came with Qantas frequent flying points and that there was a $200 annual fee. And I was aware of the card’s interest rate, which wasn’t a low rate though not up there with store cards like David Jones (there was no other store for me until I discovered KaDeWe!). I decided to switch cards because I was sick to death of merchants passing on up to three per cent with the American Express card – what a joke.

I have no one to blame but myself for not making myself fully informed of all the conditions around credit card usage. But it still annoys me that every item I purchased was made more expensive by this percentage fee. Not a flat fee but a percentage. Let me give you an example of my grief. My Strasbourg meal of ‘rognons’ (those ‘tasty’ kidneys I told you about in my blog last week) went up about $3 because of this transaction fee, which isn’t that bad. But a bigger item increased in price by $60 due to this fee.

My message is this: don’t do what I did and find your balance sheet worse off because of credit card fees and charges that could possibly be avoided, or minimised. Shop around – and read the fine print.

Important information:This content has been prepared without taking account of the objectives, financial situation or needs of any particular individual. It does not constitute formal advice. For this reason, any individual should, before acting, consider the appropriateness of the information, having regard to the individual’s objectives, financial situation and needs and, if necessary, seek appropriate professional advice.

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