subject: Low Interest Credit Cards - The Way Forward [print this page] Low Interest Credit Cards - The Way Forward
Credit is a powerful tool, when used properly. One of the best ways to use credit is witha low interest credit card. They are, at times, difficult to find, but once you find one, hang on to it. If you are building your credit and maintaining a small to medium monthly balance, you'll want to carry that balance on card with the lowest possible interest rate, or APR. Most companies offer both high- and low-interest cards; it is generally more difficult to successfully apply for a low-interest credit card.
APR stands for "Annual Percentage Rate" and it is the rate of interest that the credit card company will be charging you to use the card. The APR is generally calculated monthly, based on your 'average' balance, which takes into account your old balance, new purchases and new fees. It is required that a company tell you the APR before you submit your credit card application. Also, the APR can be either 'fixed' or 'variable'; the variable rates can be tied to many different financial indicators. This also has to be disclosed before applying.
Another to be sure to ask about when applying for any credit card, regardless of the interest rate is whether there are annual fees associated. Application fees, annual fees, optional (or even required) balance protection insurance, and so on. These also have to be stated up-front, but you have to do the work of finding and identifying them. Some cards charge their annual fee once a year; some divide it evenly over each month. Good to know this when planning on how to use your credit card. Another thing to look for is the difference in purchase interest rate and cash advance interest rate -- cash advance rates are usually higher, and sometimes much higher.
Living life today without credit can be a difficult proposition -- learning to properly use credit cards can make life significantly easier in the long run.
Having a credit card can be, in some cases, a lifesaving experience. But with credit comes responsibility; you must treat your credit carefully in order not to find yourself in a deep pit of debt and struggling to climb out. There are many websites dedicated to finding the best low-APR credit cards; simply search 'low-interest credit cards' and you'll find more than you can imagine.
