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angela self on spending

Dread looking at your credit-card bill? Well, here's some really scary news: You may be paying a fee for something you don't need.

Next time you check your statement, read the fine print to see whether it includes a sneaky charge known most commonly as credit balance insurance - a monthly fee to ensure that if something awful happens to you (layoff, illness etc.) your balance will be paid in full.

Sounds fine - but what if you are a) not at risk of being laid-off and b) healthy as a horse? This "well-intentioned" fee becomes a major money waster. Plus, there are so many stipulations surrounding it, chances are good the insurance won't even apply to you in the end.

A friend of mine recently discovered she was shelling out close to $200 a year (the amount fluctuates with your balance, ranging from $0.29 to $1.50 for every $100) for the past 10 years. That's $2,000 spent on insurance she didn't need - and hadn't knowingly signed up for.

If you're paying this cost, call your credit-card company and cancel it immediately. While you're at it, ask for documentation showing you did indeed sign up for coverage. No proof? You may be eligible for a refund of some of the premiums you've paid. If that's the case, put the cash toward something that will really keep you healthy and wealthy: a dent in your balance.

Angela Self is one of the founders of the Smart Cookies money group. Read her weekly column on managing debt and saving money at the new globeinvestor.com.

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