Why a 0% APR Card is More Helpful Now Than Ever
- June 10, 2022
- 6 min read
- 70 reads
Credit cards are a great tool for helping you get through tough times financially. You can use them to buy groceries, pay rent, and other necessities.
However, they also come with high fees and interest rates, and most of them charge interest the first day you carry a balance.
The good news is that there is a credit card that can give you more flexibility – without adding high interest rates.
0% Intro APR credit cards are designed to help consumers pay down debt quickly. These cards offer zero percent introductory APR on purchases and balance transfers for a specific amount of time – typically 12 to 15 months.
There are many different types of 0% Intro APR credit cards, including rewards cards, cash back cards, travel cards, student cards, and even secured cards.
With American household debt already exceeding $14.6 trillion in 2021, becoming debt-free and managing unnecessary high interest rates are now more important than ever.
Furthermore, 59% of Americans say they will be able to pay off all their credit card debt within six months – which is why a zero-APR credit card can be a great way to help you reach your goals.
If you need to borrow money, consider using a personal loan instead. It gives you access to funds at a lower rate, and you won’t have to worry about paying back any interest.
If you pay your credit card bill in full every month, you will not incur any interest charges. However, if you only make the minimum payment, you will be charged interest on the amount left unpaid after the end of the billing cycle.
Some cards offer zero percent APR for purchases made within certain categories, like groceries or gas. These cards usually come with an annual fee.
How to Benefit from a 0% APR Credit Card
0% APR credit cards offer a great opportunity to consolidate debt. You can use them to pay off high interest rate debts like student loans, car loans, and mortgages, or even gifts that you purchased during the December global holidays. If you’ve got a lot of credit card debt, you might consider using a 0% APR credit card to help you get back on track.
With credit cards being an easy way to get money when you need it, this type of credit card can be a great addition to your wallet.
Remember that you can only get an intro APR for a certain amount of time. Once that time is up, you’ll start paying interest at the standard APR. So if you need to stretch your payments out longer, pay off your balance before the intro ends.
You can also look for lenders that offer 0% APR credit cards for bad credit although you typically need a fair to good credit score to be approved. Some of the best 0% APR cards are those offering the longest zero-APR periods, with low APRs after the initial free period.
Good examples for these include the Wells Fargo Reflect℠ Card, the BankAmericard® credit card, and the Chase Freedom Unlimited® card.
The Best 0% APR Credit Cards
One good option is the PenFed Platinum Rewards Visa Signature® Card. It offers a 0% promo APR on balance transfers for 12 months until September 30, 2022, and after that a non-variable APR of 17.99%.
If you’re looking to get even more out of your 0% APR credit card, consider PenFed’s Power Cash Rewards Visa Signature® Card. It offers more than just savings – it has great rewards and best of all – no annual card fee.
This card offers a 0% APR on purchases for the first 12 months after account opening. After that, your APR will be 17.99%, with a 3% transaction fee applying to every transaction. You also get a $100 bonus statement credit when you spend $1,500 in the first 90 days, and 1.5% cash back on all purchases.
The UBS American Express® Gold Rewards Credit Card is an excellent choice if you’re looking for a rewards credit card with a great sign-up bonus.
You’ll earn 3 points per $1 spent on all purchases, 2 points per $1 spent everywhere else, and 1 point per $1 spent abroad. Plus, you get 5x points back when you pay your bill online. There’s no foreign transaction fee either.
Pros of 0% APR Credit Cards
The main benefit of getting a zero-interest credit card is quite obviously – to avoid paying interest. But there are other benefits too.
Save on Interest
If you always pay your credit card bill in full every single time, then you will never have to pay any interest. If you pay less than the minimum amount due, you will still end up paying interest, but not nearly as much as if you paid nothing.
For example, let’s say you owe $1,500 on a credit card with an APR of 25%. You need to pay $100 every month to keep the account current. If you pay $50 each month instead, you will pay $150 in interest.
That means you will pay $700 in total interest over the course of two years.
If you pay $100 each month, you will pay $300 in total interest over the same period. So, by paying just $50 more each month, you end up paying less than half in total interest.
Pay Your Debt Faster
A balance transfer credit card can save you money if you’re looking to consolidate your debts. You’ll get an introductory 0% APR on all balances transferred within 12 months.
After that, you’ll still pay the standard rate on your outstanding balances, but you won’t accrue any interest. That means you’ll pay less overall because you’ll be paying down your debt faster.
Get Rewarded for Spending
Credit cards can be useful if you’re looking for ways to save money. You can get reward points for spending money at certain stores, and then redeem those points for discounts on future purchases.
Some cards even give you cash back when you buy something else. But before you sign up for any card, read all the terms and conditions carefully.
Make sure you understand what your rights are under the law, and what kind of charges will affect your credit score.