Two popular kinds of standard credit cards
Low interest cards
A low-interest card may mean one of two things:
- You’ll get a low interest rate forever, like an 8% fixed-rate APR. (The average credit card APR hovers around 16%.)
- You’ll get a long intro APR period. For example, you could get a 0% purchase APR for 18 months. After 18 months, the APR might go up to 20% — at which point your card isn’t really a low-interest card anymore).
A low-interest card is useful if you like to pay your balances over long periods of time. It’s also a good choice if you’re making an expensive purchase soon and need time to pay it off.
What credit score is ideal?
The best interest rates generally go to those with the best credit. For low-interest cards, you’ll usually need a good to excellent credit score of 680 or higher.
Compare low interest credit cards
Balance transfer cards
A balance transfer card gives you a sweet incentive to move your debt to another card provider. Namely, it offers a low interest rate on balance transfers — often 0% — for a long time. Pick up a balance transfer card if you need to get away from high interest rates for a while.
For example, consider the Citi Simplicity® Card, which offers a 0% intro APR on balance transfers for 21 months. You could transfer all of your credit card debt to the Citi Simplicity® Card and pay no interest on it for almost two years. In the meantime, you can slowly pay off the debt over time.
What credit score is ideal?
Card providers only want to take on your debt if they’re reasonably certain you’ll pay it off. That said, you’ll typically need a good to excellent credit score of 680 or higher to get a balance transfer card.
Why do card providers offer long low-APR periods on balance transfers?
It’s an incentive for you to ditch your current provider and switch allegiances. When you transfer your balance, a card company scores big because it acquires you as a customer.
Additionally, there’s a chance you won’t pay off your debt before your intro APR expires. At that point, you’ll start paying interest on whatever you owe — and that’s when your card issuer really starts making money.