As with other things in life, it pays to be responsible. It is so important for your financial freedom to have good credit and maintain as high of a credit score as possible. Nowadays, people with bad credit are given more opportunities than ever before. What they don’t realize, however, is that they are paying a horrible price. Here are five major reasons that a “bad credit” credit card can cost you hundreds or even thousands of dollars each year.

1. Interest Rates. If you have bad credit, you can still get a credit card. But, do you know how much your interest rate will be? Your interest rate will be considerably higher if you have bad credit. This is because you are viewed as a financial risk. Lenders will only give you a high interest rate until you have proven that you are no longer a credit risk. With bad credit, you probably won’t ever be offered a credit card with 0% APR. Instead, your introductory rate will be at least 15%.

2. Processing fees. Get prepared to pay a one time processing fee if you have bad credit. Lenders say “one time processing fee” to make it sound nominal. However, this is not the case. You will be charged a processing fee to cover the risk associated with lending to you. Save yourself money by only having good credit.

3. Annual fees. There are many credit cards available with no annual fee. If you have bad credit though, don’t expect to qualify for one of these cards. Once again, you’ll be charged an annual fee to cover the risk of lending to you. Annual fees aren’t just $20 per year. You could pay hundreds of dollars per year to have a “bad credit” credit card. Many credit card issuers will also charge monthly maintenance fees to your account.

4. Late payment fees. You certainly won’t be paying $10 late fees if you have bad credit. Credit card companies increase your late fee depending on how bad your credit is. Not only will you be paying quite a lot more for late payments, but credit card companies will be quick to report your late payments to credit bureaus. Save yourself money and the added embarrassment of paying late fees by making your payments early.

5. Lower credit limits. You can expect a lower credit limit if you have poor credit. This is because of the financial risk associated with low credit scores. Lower credit limits can also lower your credit score based on the balance amount charged relative to the total credit limit amount.

As you can see, there are several ways a “bad credit” credit card can cost you more money. It would be better to take a few months and fix your credit before applying for a credit card. You will get a better interest rate, no processing or annual fees, lower payment fees and higher credit limits. Give yourself all the opportunities you deserve with good credit.