The Best Low Interest Credit Cards
Find top offers for low interest rate credit cards that won't have you paying too much just for carrying a balance from one month to the next.
No one plans to pay interest.
When someone opens a new credit card account, they often convince themselves that they will pay in full every month and never carry an unpaid balance.
But then unexpected expenses - like car repairs and vet bills - start adding up.
Suddenly, carrying some debt in the form of an unpaid credit card balance is necessary.
If a person never planned to carry a balance, the APR (Annual Percentage Rate, or interest rate) might not have factored highly when they chose the credit card.
But when you can't pay your monthly credit card debt in full, it becomes painfully obvious how important APRs are when choosing a credit card.
Low interest rate credit cards are out there.If you're looking to get your first credit card, as long as you don't have a poor credit report there are low APR credit card options available.
If you already have a credit card and are looking for a new one, there's a good chance you'd like to transfer an existing balance from a card with a higher APR to a card that charges less interest.
We've looked at all the low interest credit cards out there and listed our recommendations here.
Sooner or later, everyone is going to have to pay interest on an outstanding credit card balance.
With these cards, the amount of interest you'll pay is low, so you can concentrate on paying off the balance instead of paying the interest.
Do the Math
Balance transfers can make sense, but be careful.If you're looking for a low interest credit card there is a good chance you are seeking out a card with a lower APR than what you are paying on an existing credit card balance.
Perhaps you signed up for a higher APR card when you had a lower credit score.
Now that you've raised your credit score to the "Good" or "Excellent" status, you can qualify for a card that charges less interest.
That means you will probably want to transfer your current outstanding balance from your high APR card to a low APR card.
Just make sure you do the math and pick your card carefully, especially when it comes to balance transfer fees.
We can do some math for you.For example, if a low interest credit card has a sign-up bonus offer of $100 and charges 0% APR on balance transfers for the first 12 months, it might seem appealing.
But if you are transferring a balance of $3,000 and there is a 5% balance transfer fee, you'll end up paying $50 – $150 more than the sign-up bonus was worth!
Make sure you do the math so the balance transfer fee isn't negating the other benefits of the low interest credit card you're looking at.
How we picked the best low interest rate credit cards
Saving money is the main priority.Our main goal is to show you the cards that will save you the most on interest.
If you need to carry a balance from month to month, a low interest credit card should save you money on your monthly payments.
Low interest cards are usually good for transferring a balance. Low interest credit cards are also appealing for people who want to transfer a balance from a high APR card.
So, we've also factored in the balance transfer fees and balance transfer APRs when choosing these cards.
Of course, it's also important that the other terms and conditions for these low interest credit cards we recommend are solid.
Annual fees, introductory APR rates, bonus offers, and cash-back rewards were therefore also considered when we were making our picks.
This card has the lowest interest rate we found and a solid balance transfer deal
Lowest of the low for APR.Our top pick for the best low interest credit card is the Discover it card.
The bottom line is the low APR, which is set between 11.99-23.99% (variable) based on creditworthiness, is the lowest interest rate we could find among the cards we reviewed here.
People also love the 14-month, 0% APR introductory rate on balance transfers and purchases.
But they don't love the 3% balance transfer fee.
That said, it could still be very worthwhile to transfer a balance when you do the math.
If you transfer a balance of $3,000, you'll pay $90 in balance transfer fees.
But if you pay $221 a month for the 14-month 0% APR intro period, you'd save over $400 in interest.
Here's the catch though. If you also want to enjoy 0% APR for the first 14 months on purchases, you first must pay the balance you transferred in full.
Otherwise, you will pay the regular APR on purchases in each billing cycle.
The Discover it card's sign-up bonus matches all the cash-back you earn in year one
Unbeatable bonus offer. The Discover it card is also a rewards credit card with one of the most potentially lucrative bonus offers in the industry.
All the cash-back you earn in the first twelve months is matched at the end of the year.
With the chance to earn up to 5% on featured purchases and 1% on all other purchases, that can really add up to a big first-year bonus.
Cash-back earned at 5% or 1% can be redeemed at any time, in any amount
Quarterly bonus categories.Every quarter, Discover it cardholders can register to earn 5% cash-back in specific categories and vendors.
For example, from October to December, the 5% cash-back bonus is offered for purchases at Target and Amazon.com.
For the January to March promotional period, it's gas stations and wholesale clubs.
April to June you earn 5% cash-back at grocery stores. And July-September 5% is earned at restaurants.
The maximum you can earn at 5% each quarter is $1,500 in purchases.
Outside of those categories and beyond the 5% earning limit, Discover it cardholders earn 1% cash-back on all other purchases.
Earn hundreds if you make the most of year-one cash-back. Every 100 cash-back points equal $1. So, 10,000 points can be redeemed for $100.
If you maxed-out the earnings you could make in the 5% bonus categories alone in the first year, you would earn 30,000 points.
The Discover it card would then match those to make your total 60,000. That's $600!
What about the annual fee?
Look for low fees.If you signed up for a low interest credit card, you probably did it to save money.
So, it's important that there aren't a lot of fees that offset the savings you will make in interest.
Never pay an annual fee. The Discover it card charges no annual fee. That's not a first-year intro offer or promotional period, that's permanent.
You will, however, pay a fee for cash advances (5% with a $10 minimum). And late or returned payment fees are $37.
You'll need to choose between saving on balance transfer interest or purchase interest when you apply
Pay off your balance transfer to get 0% APR on purchases.Saving on interest with the intro offer of 14-months of 0% APR on purchases and balance transfers is one of the strong features of the Discover it Card.
But the offer is a bit misleading. You must pay off the balance you transferred in full before the 0% APR on purchases kicks in.
That means you'll need to choose between saving interest on a big purchase within the first 14 months or saving on the interest you would pay on a balance transfer.
You can't have both at the same time.
Good for balance transfers with a 21-month, 0% APR intro offer
Our next pick is the Citi Simplicity Card.
Not the lowest APR, but still low.The bottom-line is that its regular APR interest rate is 14.99-24.99% (variable).
That's a bit higher than the Discover it card but still quite low compared to industry standards.
Longest no-APR intro period. But what stands out for this card is the 21-month, 0% APR introductory rate offer on purchases and balance transfers.
That's the longest we found among the cards we reviewed.
Balance transfer fee, but no rewards.Just like the Discover it card, there is a 3% balance transfer fee.
Unlike the Discover it, there are no rewards or bonus points that can help offset that cost.
But the extra seven months interest-free to pay off the balance transfer can save you a lot.
To learn more about Citi's various cards and their balance transfer rates, check out our comprehensive review.
Best card for the chronically late. The other thing people love about the Citi Simplicity card is that it doesn't charge late fees.
And when you do make late payments, there is no penalty APR increase.
Add to that the permanent $0 annual fee and it's hard to beat this card for fees.
No consequences for behaving badly. However, some critics of the no-late-fee or penalty policy point out that it encourages bad behavior.
Eventually, getting used to late payments could negatively impact a person's credit history.
"Simplicity" means no sign-up bonus
Not the right card if you're looking for a big intro bonus.When it comes to sign-up bonuses, the Citi Simplicity card can't compete with most other cards.
That's because there are none.
The only sign-up benefit is the 21-month, APR-free intro period.
"Simplicity" also means no rewards
You don't earn, and you don't redeem.We can't offer any tips for earning or redeeming rewards with the Citi Simplicity card because there are none.
Are there any other benefits to the Citi Simplicity card?
Pointless control over payment schedule.You do get the chance to set up your monthly payment on the monthly due date of your choosing.
Although there are no late fees or penalties, that seems like a somewhat useless perk.
Apply and transfer an existing balance to save on 21 months of interest
Longest 0% APR intro period out there.Nearly two years interest-free for balance transfers is a very inviting offer, especially if you are currently paying a high rate of interest on an existing balance.
You can apply on the Citi Simplicity card's application page. The 21-month, interest-free period begins the day that you transfer your balance.
You'll need a credit score that is "Good" to qualify for the Citi Simplicity card.
But if you're hoping to get the lowest interest rate you'll need a score that is "Excellent."
Chase Freedom Unlimited
With a low interest rate and the long-term cash-back opportunities, this card is a win
Not the lowest interest rate but still pretty low.Our third pick for the low interest credit card is the Chase Freedom Unlimited.
The 15.99-24.74% regular APR for this card is higher than the previous two we reviewed here. But it is still relatively low by industry standards.
Appealing cash-back rewards. However, with the chance to earn 1.5% cash-back on all purchases, this card still appeals to many consumers.
No APR on balance transfers, but watch out for the high fee.People love to see the Chase Freedom Unlimited's low APR introductory rate offer.
It charges 0% interest on purchases and balance transfers for the first 15 months.
Unfortunately, this is one of those cards that charges the super-high 5% balance transfer fee we warned you about earlier.
So, we would not recommend this over the other options for transferring a balance.
Paying 5% to transfer a debt to pay less interest is better than other options like credit card debt settlement services.
But it's a high fee compared to other cards.
The $150 new cardmember bonus is easy to earn
$150 in your pocket for signing up.The Chase Freedom Unlimited card has one of the better sign-up bonuses we saw among low interest credit cards.
New cardmembers get $150 and all they have to do is spend $500 on purchases in the first three months after starting with the card.
A lot of cards make you spend much more to earn smaller sign-up bonuses, so that's a big plus.
When you add a second authorized user, you get another $25 in sign-up bonus points as soon as they make a purchase in the first three months.
Cash-back earning is unlimited, and you can redeem any amount you want
Simple cash-back with no limits.What we like about this card is the simplicity of its cash-back rewards program.
You earn 1.5% on everything, with no limit to what you can earn.
There are no rotating categories like with the Discover it card, and 1.5% is obviously a lot better than not earning any cash-back at all like with the Citi Simplicity card.
When you're ready to redeem for cash-back there is no minimum you need to have earned.
And your cash-back points don't expire.
Are there any other fees charged by the Chase Freedom Unlimited card?
No annual fee forever.The Chase Freedom Unlimited card doesn't charge an annual fee to its users.
And that's not just an intro offer, that's forever.
But there is a 3% foreign transaction fee.
Like the balance transfer fee, cash advances are also charged quite high fees at 5% ($10 minimum).
Late payment fees range from $15-$37 depending on the amount of the unpaid balance.
Time your application around a big purchase
Spend big up front.Because of the 5% balance transfer fee, we don't recommend the Chase Freedom Unlimited for balance transfers.
Therefore, the best way to take advantage of the 15-month interest-free introductory period is to sign-up right before you're about to make a big purchase.
You'll immediately clear the $500 you need to spend to get the $150 sign-up bonus.
And you can take more than a year to pay the major expense off without paying interest on your purchase.
Bank of America Cash Rewards
With a low APR and bonus cash-back, this card loyal customers
Second place for lowest APR.The Bank of America Cash Rewards credit card charges a regular APR of 13.99-23.99%.
That puts it ahead of the Citi Simplicity card and the Chase Unlimited Freedom card for the lowest regular APR.
But it still doesn't beat the Discover it card as the lowest APR card among the ones we've reviewed here.
Solid cash-back rewards program, with room to improve.In addition to the relatively low APR, the Bank of America Cash Rewards credit card also has one of the best cash rewards programs.
A cardholder can earn between 1-3% cash-back on purchases.
But if they have a bank account with Bank of America their cash-back points get a 10% boost.
And if they have significant assets invested through Bank of America, they can get an increase of 25-75% more cash-back.
No annual fee, but exclusive rewards program.People love that no annual fee is ever charged for a card that offers great opportunities to earn cash-back.
But they don't like it when they discover that the highest rates for cash-back rewards are reserved for people with $25,000 or more invested with Bank of America.
The sign-up bonus for the Bank of America Cash Rewards credit card is hefty and it's fairly painless to qualify
$150 for signing up is easily within reach. The sign-up bonus for the Bank of America Cash Rewards credit card is identical to the last one we reviewed here for the Chase Freedom Unlimited card.
New cardmembers get a $150 cash-back credit, and all they have to do to claim it is spend $500 in the first 90 days.
To get the down-low on all the Bank of America credit cards out there, check out our in-depth guide.
You can earn and redeem some serious cash-back per quarter (and get it increased even more if you have a Bank of America account!)
Bonus categories let you earn more.Cardholders earn 3% on gas and 2% on purchases at wholesale clubs and grocery stores on up to $2,500 in combined spending.
After that, and for everything else, you can earn unlimited 1% cash-back.
Let's calculate what that all means.Bank of America has a handy cash-back rewards calculator on its Cash Rewards credit card webpage that helps you figure out how much you can earn.
If you spent $1,000 on gas in a quarter at 3% cash-back, then spent $1,500 at wholesale and grocery stores at 2%, you'd max out the $2,500 quarterly spending limit for higher-percentage earning.
If you spent an additional $3,000 on everything else in the quarter at 1%, you'd get $90 cash-back total.
Sounds good, right? It gets better!If you have a bank account with Bank of America you'd get an extra 10%, making that $99 in cash-back.
And if you're a member of the Bank of America Preferred Rewards program, it would be bumped up by 25-75%.
>How do you become a member of the Preferred Rewards program?
You have to have money to earn money.That's the catch.
You have to have at least $25,000 in assets parked or invested with Bank of America to get invited to the Preferred Club. That gets you 25% more cash-back rewards points.
If you have $50,000 invested with Bank of America, you get a 50% rewards bonus.
And if you are fortunate enough to have $100,000 or more with Bank of America, your cash-back rewards increase by 75%.
Open a Bank of America bank account before you apply
Open an account and get more cash-back.If you're willing to go all-in with Bank of America to earn the most cash-back rewards possible, you should start by opening a checking or savings account.
Then all the cash-back you earn with the Cash Rewards low-rate credit card will be increased by 10%.
And if you do well for yourself and build wealth, your loyalty bonus can increase to 25%, or even 75%.
Whether you're getting a new card or switching from an existing one, choose a low interest credit card
Interest is inevitable.You're just going to have to admit it – sooner or later you're probably going to have to pay interest on an unpaid credit card balance.
When you do, you'll be glad you picked a credit card company with one of these low interest credit cards.
Why pay more interest?If you're currently paying a lot of interest at a high rate with an existing credit card, consider transferring a balance to one of the these low interest credit cards.
Especially the ones with lower balance transfer fees and nice, long 0% intro APR periods.
With most of these cards, you'll not only just save monthly on interest, you'll also earn cash-back and avoid fees.