Low Interest Credit Cards
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- Longest Purchase Period
- Lowest Cash Advance Rate
- Longest Balance Transfer Period
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Learn MoreWhat is a low interest credit card?
It’s a credit card with a low interest rate for the life of the card, not an introductory low rate which then balloons into a high rate .
Introductory rates can be very appealing, like 0%, but once the introductory period (usually between 6 months and 2 years) is over, the interest rate can climb dramatically. Meanwhile, you may have run up a ‘cheap’ debt on the card that suddenly becomes too expensive to service.
With a low-interest card, you’ll know where you stand from the start, and, if you do run up debt, you won’t be charged excessive interest rates.
What are some things to consider when choosing a low interest credit card?
- Check that the ‘low interest rate’ isn’t only an introductory offer for a limited time.
- Is there an annual fee? Especially one which will wipe out the benefit of having a low interest rate.
- Are there any rewards which you are looking for, flight credits and the like? And, are you prepared to go without them for a lower rate? Some cards may have not quite as low an interest rate, but still offer some rewards. You decide: is a low interest rate more valuable to you than a few extra frequent flyer points?
- Be aware that cash advances on your credit card may attract a higher interest rate than purchases do.
A new credit card can take the bumps out of our financial journey. It’s often a great option, and, paid off within the agreed time, may not attract any additional interest payments. The problem is, we are sometimes unable to pay it off in full, and our balance can attract some pretty high interest charges. That’s where choosing a low interest rate card in the first place can pay off.
A new credit card can take the bumps out of our financial journey. It’s often a great option, and, paid off within the agreed time, may not attract any additional interest payments. The problem is, we are sometimes unable to pay it off in full, and our balance can attract some pretty high interest charges. That’s where choosing a low interest rate card in the first place can pay off.
Other things to look out for when comparing low interest credit cards:
As well as the considerations above, there are some general things worth paying attention to, whatever type of credit card you’re applying for:
| Can you transfer a balance from another credit card? | - If so, find out how much you can transfer, it could save you money if you’re transferring from a higher interest rate card. |
| How many Interest-free days are there on purchases? | - Typically, there’ll be an interest free period when you make a purchase. Paying back within this period could save you money, so make sure you know how long this period is and when it begins. |
| Rewards programs | - A low interest card may not offer a rewards program. Some do, but may charge additional fees for these. |
| Annual fee | - Check if there’s an annual fee and know when you’d need to pay it. |
| Are there any other fees? | It’s possible that you may also incur fees for things like: - a transfer to the new credit card; - late repayments; - cash you might want to take out; - going over your credit limit; and - using your credit card for shopping or overseas travel. |
What are the pros and cons of a low interest rate credit card?
Pros:
- A low interest rate card can help you manage financial speed humps, economically.
- Lower interest can help you pay off your debts quicker.
- You may be able to transfer existing debt from a higher interest card, and save money.
Cons:
- If you do transfer a balance from another credit card, you may be charged a fee.
- You may well have no free rewards program attached to the card.
- Cash advances will probably have no interest free period.
- Don’t get carried away. It might be low interest, but even low interest on a high balance can get expensive to pay back.
Are you ready to go low?
If you’re ready to compare low rate credit cards, you can start here online with iSelect.* See the range of providers and simply click on an option that suits you to begin your application.
Are you ready to go low?
If you’re ready to compare low rate credit cards, you can start here online with iSelect.* See the range of providers and simply click on an option that suits you to begin your application.
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