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Author: Robin Saks Frankel | Last Updated: September 13, 2018
Bankrate’s experts have studied over 850 credit cards in this category and have graded cards against a proprietary scoring matrix to give each card a score out of 100. This score is designed to help you find the best low-interest credit card to fit your needs.
Bankrate’s scoring methodology identifies the best low-interest credit card by evaluating each card against a criteria which includes the cards’ variable APR and penalty APR, annual fee, balance transfer offer, rewards value, 0% intro APR offer, and any extras or discounts. To identify the best low-interest credit cards we have focused on the most important elements for low-interest credit card users: APR, introductory APR offer, annual fee, balance transfer offer, and any extras and discounts.
|Card name||Bankrate score||Best for|
|Capital One Venture Rewards Card Card||94/100||Flexible rewards|
|Blue Cash EveryDay Card from American Express||89/100||Everyday spending|
|Discover it® Cash Back||93/100||First year rewards|
|Citi Double Cash Card||94/100||Flate-rate cash back|
|Discover it® Miles||95/100||Basic travel rewards|
If you’re looking for a card with a low cost of ownership and easy-to-earn flexible rewards, look no further. The Capital One Venture Rewards Card earns an unlimited 2X the miles on every $1 spent and you can redeem those miles to book travel any way you like.
If you’re like many suburban households, you spend a lot of time and money at the supermarket and at the gas pump. The Blue Cash Everyday Card from American Express offers solid rewards for spending in those areas, paying 3% cash back rewards on up to $6,000 in spending at U.S. supermarkets and 2% back at U.S. gas stations and select U.S. department stores and 1% back on all other spending.
The Discover it® Cash Back earns 5% cash back at different places each quarter like gas stations, grocery stores, and wholesale clubs up to the quarterly maximum each time you activate. Also, earn an unlimited 1% cash back on all other purchases. Redeem your cash back any amount, any time because your rewards never expire.
The Citi Double Cash Card offers some of the best value of any no fee cash-back card available today. Cardholders earn 1% cash back when they make a purchase and another 1% back when they pay for their purchase.
What makes this card intriguing is that, like most Discover cards, the issuer will match your first-year earnings dollar for dollar. The Discover it® Miles card earns 1.5 miles for every dollar, which is a just-OK rate. But the first-year earnings work out to be 3 miles for every dollar, which puts it on a par with some of the best cash-back cards on the market.
Owning a credit card with a low interest rate can save you money. If you qualify for the lowest rate offered by the issuer, and you typically carry a balance, you’ll pay less over time than if your rates were higher.
There’s also an option with some cards to get an introductory 0% interest rate on purchases, balance transfers or both. The length of time at 0 percent interest typically ranges from 12 months to as long as 21 months, after which the standard variable APR will apply.
When choosing a card with low interest or a zero interest sign-up offer, consider your spending habits first. If you almost always carry a balance, you may be better off with a card that has a set low interest rate then one at 0% that will likely jump up to double digits when the promotional period is over.
You can apply for a low interest credit card online and you’ll usually find out if you’re approved within minutes. But, if your credit is just fair or worse, you may not qualify for a credit card that offers advantageous rates.
Low interest credit cards are typically good for balance transfers and large purchases. However, these cards typically come with limited sign-up bonuses.
The current average variable APR on a credit card is between 16% to 17%. If you typically carry a balance, you can benefit by switching to a card with a lower APR. For example, if you have a balance of $10,000 on a card with an APR of 16%, over the course of a year if you leave that balance untouched, you’ll accrue an additional $1,600 in finance charges. But, shift that balance to a card with an introductory 15-month 0% offer and after a year, that same $10,000 balance won’t have racked up any finance charges, saving you $1,600.
If you are carrying a lot of high-interest debt, shifting the balance to a card with a lower APR can save you money. But, it’s important to do the math before making the switch. Many cards that offer an introductory 0 percent APR will also charge a balance transfer fee. Typically, this fee ranges from 3%-5% of the amount being transferred.
In some cases, the cost of a balance transfer fee could outweigh the savings of shifting to a low interest card. For example, if you have a balance of $10,000 on a card, but you plan on paying this balance off over the course of a year, it may cost you less in interest than if you shift this balance to a card with a 0 percent introductory offer that has a 5 percent balance transfer fee, which will cost you $500 to move.
When it comes to choosing a credit card that offers better terms than what you may currently have, it’s important to make the distinction between low interest cards and ones with an introductory zero percent offer. There are no credit cards that offer 0% interest forever, as the definition of a credit card is a card that lets you pay off a balance over time in exchange for accruing interest on the amount of debt you’re carrying. If you want a truly interest free piece of plastic in your wallet, you’d be better off with a charge card which doesn’t carry any interest charges but you have to pay the balance in full every month. Or consider just using a debit card, which subtracts the amount of your purchase directly from your bank account. Keep in mind that using a debit card won’t help you build a strong credit score as transactions on a debit card are not reported to the big three credit reporting agencies.
Choosing the right low interest card can be daunting. It’s important to consider not just the short-term benefits but how you’ll use the card in the years ahead.
In general, if you typically carry a balance on your credit card, it’s probably best to choose a card that has a low APR over one with an introductory 0 percent offer, as once the offer expires, the variable APR is likely to be higher than that of a card that has a consistently a low interest rate.
But, if you’re looking to make an expensive purchase and want to pay it off over time, a card with an introductory 0 percent offer might make sense, especially if you find a card that has some lasting value to you after the welcome offer.
* See the online application for details about terms and conditions for these offers. Every reasonable effort has been made to maintain accurate information. However all credit card information is presented without warranty. After you click on the offer you desire you will be directed to the credit card issuer's web site where you can review the terms and conditions for your selected offer.