Low Interest vs. 0% APR Credit Cards

Credit cards can be categorized as low interest, 0% APR or both. The best credit cards provide a 0% APR and a low interest rate. But what's better: having a 0% APR, or a low interest rate? Let us show you the pros and cons of both types of offers so you can determine which type is best for your financial situation.

0% APR Credit Cards:

0% APR credit cards use a "teaser" or "intro" rate to attract new customers - and new purchases. For a specified period of time - sometimes 12 months or more - cardholders will avoid interest on new purchases and / or balance transfers. If used properly, consumers can save a ton of money with these types of offers. But be aware, the 0% APR doesn't last forever. And after the intro period ends, the ongoing rate may (or may not) be higher than the average credit card APR.

PROS:

Save money on new purchases you can pay off quickly. Save money by transferring existing credit card balances. Carry your debt interest-free by transferring cards regularly.

CONS:

0% APR doesn't last forever! Could cause overspending or misuse of card. Interest charges could compile after intro period ends. May have higher interest rate after intro period.

Low Interest Credit Cards:

Unlike 0% offers, low interest rate credit cards have an upfront, low APR. While this rate may be variable or fixed, the rate isn't an introductory or "teaser" rate that changes after a set period of time. The better your credit is, the better the rate you'll receive. Luckily, many low interest rate credit cards on our site also include a 0% introductory APR too.

PROS:

Save money on LONG-TERM charges. Don't have to "switch" credit cards to save money. No surprise rate increases after intro period.

CONS:

Don't gain the benefits of paying 0%! Don't save as much on balance transfers and new purchases.

* Calculate how much you can save with our Low Interest Savings Calculator >

The Best of Both Worlds:

A 0% APR can save you tons of money! You can save on new purchases and on balances transfers. But a low interest rate credit card might be better for LONG-TERM charges. Why not take advantage of both types of offers? When you're shopping for your next credit card, try to find an offer with a 0% APR and a low interest rate. Then determine which features are more important to you so you can decide which credit card is right for your personal needs and interests.

* See a complete list of low interest or 0% APR credit cards >

Related Articles:

• Choosing the best low APR / 0% credit card
• Save money with low interest / 0% credit cards
• Using 0% APR credit cards to become debt free
• Variable vs. fixed rate credit card
   

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