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Yahoo
09-07-2025
- Business
- Yahoo
The 2025 Yahoo Finance Awards: Best credit cards
At Yahoo Finance, we spend a lot of time comparing credit cards and all the ways they can save you money. We also know there is no single card that's best for everyone's wallet. Credit cards can serve different purposes for different people, which is why it's important to fit any new card to your specific financial goals. But there are some credit cards we consider exceptional for what they offer cardholders today. Each year, we determine the top credit cards across a range of categories — travel, balance transfer, secured, business, and more — to help you determine which cards may be best for your wallet. Learn more about the methodologies used to choose our winners. These are our picks for the best credit cards available right now: Sorted by category, these are the top credit cards we recommend today. You can read more about our card ratings and the methodologies we use at the bottom of each category page linked below. As a cash-back credit card, the Chase Freedom Unlimited has some of the best flexibility you'll find for earning and redeeming rewards. Not only can you earn up to 5% back in everyday bonus categories, but you're guaranteed a minimum 1.5% cash back on all non-bonus purchases. When you're ready to redeem, you can get cash back or use your rewards to book travel through Chase Travel℠. Based on average American spending data, we put the Chase Freedom Unlimited card's estimated annual earnings at $482.15 — a solid annual gain for a no annual fee card. As a new cardholder, you'll get even more throughout the first year with a great welcome bonus and 0% APR won't find a simpler way to maximize spending toward travel than with a Capital One Venture credit card. No matter where you spend, you'll get 2x miles on every purchase. Then, you can use the miles you earn for future travel expenses: reimburse travel expenses on your card, book travel through Capital One Travel, or transfer miles to Capital One's 15+ travel partners. The Capital One Venture card does have an annual fee, but it also comes with a great welcome offer and some annual benefits that can help add more value beyond Chase Sapphire Preferred Card is our rewards card pick for the best of both worlds between everyday and travel rewards. You'll earn great rewards on travel expenses and on regular spending like dining, online groceries, and select streaming services. And to help make up the card's annual fee, there are a few annual benefits (including a $50 annual credit for hotel stays booked through Chase Travel). Once you've earned your rewards, you can really increase your value with redemptions. One of the best ways to redeem your Chase Sapphire Preferred points is by using them to book travel through Chase Travel. You'll get a 25% boost, so each point is worth 1.25 cents toward hotels, airfare, rental cars, and more. You can also transfer your points to Chase's hotel and airline can use the Blue Cash Everyday Card from Amex to save money with no interest on new purchases and eligible balance transfers for the first 15 months after account opening. After that, there's an 18.24%-29.24% ongoing variable APR (see rates & fees). Even after the intro APR offer expires, you'll still earn 3% cash back at U.S. supermarkets and U.S. gas stations, up to $6,000 spent per year, then 1%. You'll even get 3% back with U.S. online retailers (also up to $6,000, then 1%) — this relatively uncommon credit card rewards category, may cover a significant amount of your regular spending on sites like Amazon and Target or larger one-off purchases with retailers like Wayfair or Citi Double Cash Card has one of the best 0% APR balance transfer offers available today, as well as long-term cash rewards. When you transfer your existing balance within four months, you'll pay 0% APR for the first 18 months after account opening with a balance transfer fee of 3% (minimum $5). When the intro period ends, your ongoing APR will be a variable 18.24%-28.24%. Not only can you use this no annual fee card to pay down debt, but you can continue to benefit from its cash-back rewards after your balances are paid. Earn 2% cash back on every purchase you make — with 1% cash back when you buy and another 1% as you pay. With that cash back structure, you'll get rewarded as you pay down your balances and remain you build credit for the first time as a student, you can earn rewards and set yourself up with a strong credit history using Discover it Student Cash Back. The card has rotating bonus rewards, so you'll earn 5% cash back in categories that change quarterly. These can range from grocery stores and streaming services to individual retailers like Walmart or Amazon. The 5% cash back applies to the first $1,500 you spend in bonus categories each quarter; after that you'll earn 1% on all purchases. There's no annual fee to own the Discover it Student Cash Back card, and you'll build credit as you use your card over time. Discover reports your payments to each of the three credit bureaus every month, so by practicing good habits like paying on time and not spending too close to your credit limit, you can establish a solid credit history and increase your score. And don't forget to pay your balances in full each month to avoid high interest credit cards are one of the best options for people with bad credit or no credit history to build a solid score, and they can also be rewarding. The Capital One Quicksilver Secured card offers an unlimited 1.5% cash back on every purchase you make. Even without rewards, this card is a great secured option for building credit. You will need to submit a security deposit of at least $200 (which acts as your credit limit) when you open your Capital One Quicksilver Secured. But with responsible use, you can qualify for both an increased credit limit with no additional deposit and to upgrade to an unsecured version of the card and get your deposit back. All the while, Capital One reports your payments to the three credit bureaus so you can build your credit history with on-time monthly Ink Business Cash from Chase can add a ton of potential value to the purchases you make for your small business, as long as your regular expenses fall within its everyday bonus categories. Eligible purchases range from spending at office supply stores and gas stations to utility bills for internet, cable, and phone services and dining at restaurants. You can use your Ink Business Cash card to get cash back on your expenses or, if you travel for business occasionally, you can use your rewards to book travel through Chase Travel. There are also some added benefits you can use as your business grows, like spending insights, the ability to add employee cards for no additional cost, and an automatic review for a higher credit line every six New United Explorer Card is a versatile airline card option that you can use to earn miles toward future flights and get added perks when you fly. Not only will you earn significant miles on United purchases, but you'll also earn on hotel stays and when you dine out at home or while traveling. For travelers who prefer United Airlines, the United Explorer Card's benefits may be its best feature. You'll get your first checked bag free (for you and one companion on the same reservation) on each flight and two one-time passes to the United Club each year. Even if you only fly once in a calendar year, taking advantage of these two benefits could be worth up to $260 in value. You'll also get priority boarding on United flights, 25% back on select in-flight purchases, and Disclosure: The information in this article has not been reviewed or approved by any advertiser. All opinions belong solely to the Yahoo Finance and are not those of any other entity. The details on financial products, including card rates and fees, are accurate as of the publish date. All products or services are presented without warranty. Check the bank's website for the most current information. This site doesn't include all currently available offers. Credit score alone does not guarantee or imply approval for any financial product.
Business Insider
13-06-2025
- Business
- Business Insider
Best Credit Cards in America: Top Credit Card Offers for June 2025
I think about credit cards all the time. As a personal finance journalist, I've covered credit card rewards for a decade and have more than three dozen active cards. It's impossible to name a single credit card that would be perfect for everyone's needs. But knowing what you want from your credit card can help you find your best option. My family and friends frequently ask me, "What's the best credit card?" and "What credit card should I get?" I offer personalized recommendations based on their individual needs and wants, factoring in benefits, rewards, and financial protection they won't get from paying cash or using a debit card. I compiled this list of winners based on that research. I compared welcome offers, ongoing rewards for common expenses, benefits and protections like trip insurance and purchase protection, and reasonable annual fees (or lack thereof) across dozens of credit cards available today. These are the best credit cards you can get right now — you'll find most of them in my own wallet. Best For Card Annual Fee Best for cash rewards Wells Fargo Active Cash® Card $0 (rates and fees) Best for travelers Chase Sapphire Preferred® Card $95 (rates and fees) Best for families Blue Cash Preferred® Card from American Express $0 intro for the first year, then $95 (rates and fees) Best for 0% APR Chase Freedom Unlimited® $0 (rates and fees) Best for young adults Bilt Mastercard® $0 (rates and fees) Best for reward maximizers Discover it® Cash Back $0 What Is the Best Credit Card to Get? I always say there isn't a magical "best credit card" that works for every person. Many people prefer no-annual-fee credit cards because they're easy to keep long-term. Other people don't mind paying a hefty annual sum for premium credit cards with airport lounge access because the benefits of luxury and comfort are worth the cost. Some value travel rewards credit cards, while others prefer to focus on cash-back credit cards. Wherever you fall on each of these spectrums, I encourage you to hone in on what you really need for your personal situation. If you have kids, you may want to forgo airport lounges in favor of free checked bags. If you travel solo, you may want to prioritize credit cards that offer luxury benefits such as hotel elite status and shopping credits. Credit Cards for Families For parents with young children, I recommend credit cards that reward groceries, streaming services, and commuting expenses with flexible points that can be redeemed in many different ways. The Blue Cash Preferred® Card from American Express checks all of these boxes. I also suggest choosing a credit card that offers travel insurance coverage, since little kids often get sick during or right before a big trip. If you have to cancel or reschedule that expensive Disney vacation, it's always nice to recoup some of your nonrefundable expenses. The Chase Sapphire Preferred® Card is my top choice recommendation for this benefit because it's so well-rounded on all of these fronts. Credit Cards for Young Adults Young adults in college or early in their careers often find themselves spending a lot of money on rent while dining out with friends or colleagues every night. At the same time, they often value the simplicity of loading a single credit card into Apple Pay and using it for every transaction. The Bilt Mastercard® is perfect for this life stage, with gamified rewards and bonus points on common lifestyle expenses. If you're a first-time credit card applicant or a student with minimal income, you may want to consider one of the best starter credit cards or the best student credit cards. When to Pay For Annual Fees If you're a foodie, you'll want to choose one of the best credit cards for dining, restaurants, and food in general. But if you're more of a homebody, you may want to focus on the best credit cards for buying groceries and the best credit cards for gas purchases. What to Get If Your Credit is Subpar If your credit score is lower than you'd like, you may qualify for some of the best credit cards for bad credit or seek a secured credit card, which can help you heal your credit and even earn rewards while you work toward a stronger financial future. Airline Lounge Access for Infrequent Travelers It isn't worth paying for airport lounge access via a credit card if you're an infrequent traveler. Instead, pay for a mid-tier travel credit card with a sub-$100 annual fee, and buy lounge day passes as needed. If you find yourself buying more than two lounge passes each year, it might be time to consider an upgrade. How I Chose the Best Credit Cards Choosing the best credit cards is a momentous task and a responsibility I take very seriously. I regularly evaluate dozens of credit cards available to consumers and business owners, and update this guide on a monthly basis. In addition to considering my own perspective and consulting with industry colleagues, I also read popular forums such as Reddit and FlyerTalk to see what everyday consumers are saying about different cards. I evaluated each of the cards in this guide — and screened out many others — against the following criteria: Simplicity: All of the cards on this list are easy for consumers to use and understand. While I regularly update several credit card guides for maximizing rewards and benefits, my list of top recommendations is meant to help people like my parents find an easy card to use for everyday purchases. Affordability: Most of the credit cards in this guide don't cost you any money to keep. While there's a case to be made for paying a high annual fee when you're getting high value in return, most people dislike the idea of paying money to spend money. Value: A good credit card should offer enough value to offset any annual fee several times over. When evaluating no-annual-fee cards, I focused on the ones that provide the best benefits or most generous rewards. Read Business Insider's guide to points and miles valuations to learn what your credit card rewards are worth, and learn more about how we rate credit cards. Wells Fargo Active Cash® Card The Wells Fargo Active Cash® Card is ideal for people who prioritize flat-rate cash rewards. Its ease of use makes it our pick for the best credit card for earning cash rewards. This card is all about simple math and cash, earning unlimited 2% cash rewards on purchases across all categories. Wells Fargo Rewards can easily be redeemed for statement credits, gift cards, travel, and more. New cardholders can easily earn a $200 cash rewards bonus after spending $500 in purchases in the first three months from account opening. There's also a 0% intro APR on purchases and qualifying balance transfers for 12 months from account opening, followed by a 19.24%, 24.24%, or 29.24% variable APR. Finally, the Wells Fargo Active Cash® Card comes with a wide range of valuable benefits including cell phone protection for up to $600 per claim. This card does charge foreign transaction fees, so leave it at home on international trips. What I don't love: Foreign transaction fees Capital One Savor Cash Rewards Credit Card The Savor Cash Rewards Credit Card is the best credit card for foodies. That's because this card earns serious rewards on food and fun: 8% cash back on Capital One Entertainment purchases, 5% cash back on hotels and rental cars booked through Capital One Travel, 3% cash back on dining, entertainment, popular streaming services and at grocery stores (excluding superstores like Walmart® and Target®), and 1% cash back on all other purchases. Capital One miles are very easy to use once you've earned them, and have an average value of 1.7 cents apiece by Business Insider's calculations of what points and miles are worth. New cardholders can earn $200 cash back after you spend $500 on purchases within three months from account opening, and 0% intro APR on purchases and balance transfers for 15 months (3% fee for the first 15 months, then 4% at a promotional APR that Capital One may offer you at any other time), followed by 19.24% - 29.24% Variable APR. What I love: Great earning rates, no annual fee, and 0% intro APR What I don't love: Typically requires excellent credit score for approval Pro tip: If you're a student, you may want to consider the Capital One Savor Student Cash Rewards Credit Card. It has more lenient credit requirements but earns the same generous rewards. Citi Double Cash Card The Citi® Double Cash Card offers solid benefits and rewards while helping you pay off debt via a long balance transfer period, making it our top credit card for paying down debt. New cardholders can benefit from a 0% intro APR on balance transfers for 18 months, then 18.24% - 28.24% Variable APR. Cardholders who want to make a balance transfer must pay the following balance transfer fee: 3% intro fee of each transfer ($5 minimum) completed within the first four months of account opening, then 5% of each transfer ($5 minimum). But this expense is significantly lower than the credit card interest you'd pay elsewhere. The Citi® Double Cash Card earns unlimited 2% cash back on every purchase (1% cash back when you buy, plus an additional 1% as you pay for those purchases) and 5% cash back on hotel and car rentals booked on the Citi Travel℠ portal through 12/31/25. This rate is generous for a card with no annual fee that offers such a long period with no interest, and makes the Citi® Double Cash Card worth keeping in your wallet long after your zero-interest offer expires. New cardholders can also earn $200 cash back, fulfilled as 20,000 ThankYou® Points, after spending $1,500 on purchases in the first six months of account opening. The Chase Sapphire Preferred® Card is best for travelers for several reasons. One of those factors is complimentary travel insurance with generous coverage terms, especially for its low annual fee of $95. Travel insurance benefits help you recoup non-refundable expenses when things go awry, and this coverage is particularly beneficial for families who may need to cancel or postpone travel at the last minute for illness or bad weather. Cardholders also get primary car rental insurance, trip delay insurance, and baggage delay insurance. Finally, cardholders earn 5 points on travel purchased through Chase Travel℠, 3 points on dining, select streaming services and online groceries, 2 points on all other travel purchases, and 1 point on all other purchases. They also get a 10% anniversary points bonus, and up to $50 a year in statement credits for hotels booked through Chase. What I don't love: Annual fee Pro tip: Right now, new cardholders can earn a welcome bonus of 60,000 bonus points after you spend $5,000 on purchases in the first three months from account opening. This offer is worth $1,080, according to Business Insider's valuations. Blue Cash Preferred ® Card The Blue Cash Preferred® Card from American Express is a fantastic household credit card for families who spend money on groceries, commutes, and streaming services. This card earns 6% cash back at U.S. supermarkets on up to $6,000 per year in purchases (then 1%) and on select U.S. streaming subscriptions, 3% cash back at U.S. gas stations and on transit, and 1% cash back on other purchases (cash back is received in the form of Reward Dollars that can be redeemed as a statement credit or at checkout). Terms apply. The Blue Cash Preferred® Card from American Express has an annual fee of $0 intro for the first year, then $95 (rates and fees). If you max out the cash back bonus at U.S. supermarkets spending $6,000 each year, that's $360 of cash in your pocket — significantly more than the annual fee you'll start paying in Year 2. What I love: Generous rewards for gas, transit, groceries, and streaming expenses What I don't love: Annual fee after the first year (rates and fees) Pro tip: If you like everything about this card except its yearly cost, consider its sibling, the no-annual-fee Blue Cash Everyday® Card from American Express. This card earns 3% cash back at U.S. supermarkets, at U.S. gas stations, and on U.S. online retail purchases (on up to $6,000 per category per year, then 1%) and 1% cash back on other purchases (cash back is received in the form of Reward Dollars that can be redeemed as a statement credit or at checkout). The Chase Freedom Unlimited® is our pick for the best credit card for an intro APRO because it offers a generous 0% intro APR on purchases and balance transfers for the first 15 months, then 18.99% - 28.49% Variable APR. The Chase Freedom Unlimited® also earns great rewards, especially for a no-annual-fee credit card: 5% cash back on travel purchased through Chase Travel℠, 3% cash back on drugstore purchases and dining at restaurants, including takeout and eligible delivery service, and 1.5% on all other purchases. New cardholders can earn a generous welcome bonus on this card: $200 bonus after you spend $500 on purchases in the first three months from account opening. This card charges foreign transaction fees, so make sure you leave this card in your wallet when you pack your passport or shop online from a non-U.S. business. What I love: Great earning rates, no annual fee, and initial zero-interest period What I don't love: Foreign transaction fees Pro tip: While this is technically a cash-back credit card, it earns those rewards in the form of Chase Ultimate Rewards® points. I can transfer points from my Chase Freedom Unlimited® to a Chase credit card that earns travel rewards, like the Chase Sapphire Preferred® Card, to book business-class award flights through Chase transfer partners or through the Chase Travel℠ portal. Chase points are some of the most valuable credit card rewards you can earn, worth an average of 1.8 cents apiece by Business Insider's valuations. Bilt Mastercard® The Bilt Mastercard® is a one-size-fits-all credit card for young adults because it earns bonus points on restaurant and travel purchases. Young adults can even earn up to 100,000 Bilt Points per calendar year on rent by paying rent with this credit card without incurring any transaction fees. Bilt Points are extremely flexible and can be used to pay rent, book travel, or redeemed for merch or statement credits. Even non-renters earn great rewards with the Bilt Mastercard®. For instance, I got this card because I can earn 3 points per dollar on dining, 2 points on travel, and 1 point on other purchases. You won't earn points unless you make at least five purchases each billing cycle, but this card makes it very easy to maximize your everyday purchases. Cardholders earn double points on the first day of every month, affectionately known as " Bilt Rent Day", on up to 1,000 points. The Bilt Mastercard® also comes with generous benefits including primary rental car insurance, trip delay insurance that goes into effect after just six hours, cell phone protection of up to $800 per claim which is subject to a $25 deductible, and no foreign transaction fees (rates and fees). All of these benefits add up to make the Bilt Mastercard® a perfect travel companion for adventurous young adults who are ready to see the world but aren't prepared to pay an annual fee for a credit card. What I love: Double point days, the ability to pay rent with a credit card, and generous dining rewards with no annual fee (rates and fees) Pro tip: You don't have to be a Bilt cardholder to earn Bilt Points. Simply link any credit card to the Bilt app wallet to earn points on all eligible dining purchases. The Discover it® Cash Back makes earning extra fun, when you enroll in the quarterly 5% bonuses that change every three months with up to $1,500 in combined category spending. Cardholders can earn 5% cash back on purchases from rotating categories each quarter up to $1,500 when you activate and unlimited 1% cash back on all other purchases (from April 1 to June 30, 2025, earn 5% cash back at grocery stores and wholesale clubs on up to $1,500 in purchases after enrollment, then 1%). I use Business Insider's Discover cash back calendar to help me remember each quarter's categories. This card doesn't earn a traditional welcome bonus, but Discover will automatically match all the cash back earned at the end of new card members' first year through the Discover it Cashback Match program. This means you'll have your rewards earnings matched at the end of Year 1 of card ownership. This card offers new cardholders a generous zero-interest offer on new purchases and existing debt: 0% intro APR for 15 months on purchases and balance transfers, then 18.24% - 27.24% Variable APR APR. While some cards offer longer 0% APR periods, few do so while still earning rewards as generous as the Discover it® Cash Back. Southwest Rapid Rewards ® Priority Credit Card Southwest is one of the most popular airlines for U.S. travelers, and the Southwest Rapid Rewards® Priority Credit Card gives frequent flyers a serious leg up on benefits. This credit card is Southwest's premium consumer card and comes with a $149 annual fee. But cardholders get an annual credit of $75 toward Southwest flights, which effectively halves the out-of-pocket cost of the annual fee. After 50-odd years of proudly proclaiming no bag fees, Southwest Airlines began charging for checked bags in late May 2025. But cardholders and travelers with elite status will still be able to check at least one free bag per flight. Southwest will also begin charging for seat assignments in late 2025. While we don't yet know many details about this momentous change, cardholders will likely get exclusive benefits that everyday travelers do not. If nothing else, Southwest Rapid Rewards® Priority Credit Cardholders will earn 3 points per dollar when paying for preferred seating. The Southwest Rapid Rewards® Priority Credit Card won't do you any good if you don't fly Southwest, of course. But if you do, this card can help you fast-track your way to elite status and the coveted Southwest Companion Pass, especially if you time your welcome offer just right. What I love: $75 annual statement credit toward Southwest travel, free checked bag Capital One Venture X The Capital One Venture X Rewards Credit Card is the most affordable premium credit card with complimentary access to Capital One Lounges and Priority Pass airport lounges. The $395 annual fee may shock you, but the Capital One Venture X actually offers lounge access at a far lower cost than its competitors. Authorized users under your account also get complimentary memberships to all Capital One lounges — an unprecedented generosity you won't see from any other high-end credit card including the Chase Sapphire Reserve® and The Platinum Card® from American Express. Cardholders get an annual travel credit of up to $300 on travel booked through the Capital One travel portal, and a 10,000-mile bonus on each account anniversary worth at least $100 toward travel. New customers can also earn 75,000 bonus miles when you spend $4,000 on purchases in the first three months from account opening. Rewards are very easy to calculate: 10 miles on hotels and rental cars booked through Capital One Travel, 5 miles per dollar on flights and vacation rentals booked through Capital One Travel, and 2 miles on all other purchases. They're also very easy to redeem. FAQs The Chase Freedom Unlimited®, the Bilt Mastercard® (rates and fees), and the Chase Sapphire Preferred® Card are three of the top credit cards you can get right now. Each card earns generous rewards on everyday expenses like food and travel. The information for the following product(s) has been collected independently by Business Insider: Citi® Double Cash Card. The details for these products have not been reviewed or provided by the issuer.
Yahoo
02-06-2025
- Business
- Yahoo
The best balance transfer credit cards for 2025: Don't pay any interest until 2026
Why we like it: The Chase Freedom Unlimited is another cash-back credit card with a competitive introductory 0% APR period on both balance transfers and new purchases. You'll have 15 months before interest kicks in, with an ongoing variable APR of 20.49%–29.24% when the intro period ends. There's a 3% fee ($5 minimum) for balances you transfer within 60 days of account opening; after that, the fee goes up to 5% ($5 minimum). Like the other cash-back cards on this list, you can still get plenty of value from the Chase Freedom Unlimited after the introductory period ends. You'll earn 5% cash back on Chase Travel℠ purchases, 3% back on dining and at drugstores, and 1.5% back on everything else. This card can make a great choice if you already have a Chase card, too. You can use the rewards you earn to book travel through Chase Travel and even combine them with other Chase cards that may get added multipliers on travel redemptions (like the Chase Sapphire Preferred® Card or Chase Sapphire Reserve®).Given the Chase Freedom Unlimited's high ongoing APR though, it's important to make sure you don't fall into old habits of racking up revolving balances. One of this card's best features is its first-year welcome offer, for example. But if you're not able to pay down your debt balance quickly enough to take advantage of it, or you're worried it'll encourage overspending that could lead you back into debt, you may want to consider another we like it: The Blue Cash Everyday from American Express is one of our favorite cash-back credit cards today. It can also be a helpful tool for paying down existing credit card debt. The card's introductory 0% APR on balance transfers lasts for 15 months after account opening, with a variable APR of 20.24% to 29.24% thereafter (see rates & fees). The balance transfer fee is 3% ($5 minimum) of the amount you transfer. But the Blue Cash Everyday shines for its long-term savings once you've paid off your existing debt. You'll earn 3% cash back at U.S. supermarkets, U.S. gas stations, and on U.S. online retail purchases, each up to $6,000 spent per year, then 1% back (and 1% cash back on everything else). Plus, annual benefits can help you save even if you don't want to charge many new purchases to your card during the promotional period. You can get $7 in monthly statement credits (up to $84 annually; with enrollment) when you spend at least $9.99 on an auto-renewing Disney Bundle we like it: The Citi Double Cash Card is our overall pick for anyone looking to pay down debt with a balance transfer. With a long 0% APR on balance transfers for the first 18 months (18.24%-28.24% variable APR after that), it's an excellent option for debt payoff. You'll pay a 3% balance transfer fee ($5 minimum) for each balance you transfer within the first four months of account opening, which increases to 5% ($5 minimum) after four months. Throughout the extended intro period, you can make major progress on existing balances or even commit to paying the amount you transfer in full. There's plenty to like about this card after you pay down your balance, too. You'll earn up to 2% on every purchase you make with the Citi Double Cash: 1% when you make the purchase and 1% when you pay it off. That rewards structure may even add some incentive to avoid carrying a balance once you've paid down your debt, since you won't earn the total cash rewards until you pay in full. Unlike other balance transfer credit cards, the Citi Double Cash Card does not offer an introductory 0% APR on new purchases — the only detail that kept it from a perfect score in our methodology. However, if you're planning to use this card primarily to pay down debt (and then for its cash-back benefits after the intro period), we don't think that holds this card back from being a top choice among balance transfer offers we like it: The Citi Rewards+ Card is another rewards credit card with a solid 15-month introductory 0% APR period, which applies to both new purchases and balance transfers. After the intro period ends, you'll pay a 17.74%-27.74% variable APR. That's still very high for any balance you carry, but it is one of the lowest you'll find among balance transfer credit cards today. After the intro period ends, you can earn Citi ThankYou® Points on your purchases: 5x points on hotels, rental cars, and attractions booked through Citi Travel through the end of 2025; 2x points at supermarkets and gas stations (up to the first $6,000 spent per year, then 1x); and 1x on all other purchases. For each purchase you make, your rewards are rounded up to the nearest 10 — so you could get 30 points from a $24 purchase — and for each redemption you make, you'll get 10% points back (up to the first 100,000 points you redeem per year). Each of these can help you maximize points to use on travel, statement credits, gift cards, and more. The Citi Rewards+ Card isn't the only rewards card from Citi with a competitive intro period and a lower ongoing APR, but it took the edge over the potentially higher-earning Citi Custom Cash® Card for its slightly lower balance transfer fee. When you transfer a balance to the Citi Rewards+ within the first four months of account opening, you'll pay a 3% fee ($5 minimum). After that, the fee goes up to 5% of your transfer ($5 minimum), which is the same as the Citi Custom Cash Card's we like it: Discover it Cash Back similarly offers great ongoing rewards alongside a useful 0% APR. It has an introductory 0% APR period for 15 months after account opening for new purchases and balance transfers (as long as you make your transfer within a given time period). The ongoing variable APR after the intro period is 18.24%-27.24%, and there's a standard balance transfer fee that's in line with other balance transfer credit cards. The Discover it Cash Back also has great long-term value with revolving 5% cash back Discover rewards categories. You'll earn 5% back on the first $1,500 spent across the revolving categories — which may include grocery stores, restaurants, gas stations, streaming services, and more — each quarter when you activate and 1% on everything else. Like some other cards on our list, one of the Discover it Cash Back card's top features is its welcome offer: a Cashback Match on all the rewards you earn in your first year. Of course, maximizing this offer depends on earning rewards on your purchases throughout the year. If you want to take advantage of the bonus offer (and the card's revolving bonus rewards categories), make sure you can balance your spending with your debt payoff plan so you don't end up back where you started when the balance transfer intro period you're looking for the absolute longest 0% APR promotional period on balance transfers, here are a few more of our top-rated cards with long intro periods. Why we like it: BankAmericard has a solid combination of long introductory 0% APR and relatively low ongoing APR, which can be great for people solely focused on debt payoff. The introductory period for balance transfers is 18 billing cycles and applies to balances you transfer within 60 days of account opening. The same 0% APR intro period applies for new purchases. After that, you'll pay a variable 15.24%-25.24% APR on any remaining balance. While that can easily add up over time, it's significantly less than you'll find from many credit cards today. There's an introductory balance transfer fee of 3% for the first 60 days, then it goes up to 4%. There's also no penalty APR; while you should always make your credit card payment on time (especially while carrying a balance), paying late or having a payment returned won't automatically increase your BankAmericard APR. Why we like it: The Wells Fargo Reflect® Card is an excellent choice for balance transfers primarily because of its extraordinarily long 0% APR offer of 21 months. This feature allows cardholders to transfer existing balances and enjoy a prolonged period without incurring interest, providing ample time for debt management and reduction. The 5% balance transfer fee needs to be considered, but for many, the benefit of the extended interest-free period outweighs this cost. This card is particularly advantageous for those who anticipate needing more time to pay off their balances and want to avoid the rapid accumulation of interest we like it: The U.S. Bank Visa Platinum Card also has one of today's longest intro periods, with an introductory 0% APR for 21 billing cycles. That intro offer applies to new purchases and to balance transfers made within 60 days of account opening. After that, your remaining balances will earn a variable 17.74%-28.74% APR. In exchange for the long intro period, you'll again earn no rewards and pay a slightly higher balance transfer fee than other cards on our list: 5% of your transferred balance or $5, whichever is greater. Why we like it: The primary appeal of the Citi Simplicity Card for balance transfers lies in its extended 0% APR offer, lasting an impressive 21 months. This length of time is one of the longest available, providing cardholders with a substantial period to manage and pay off transferred balances without accruing interest. The 0% APR offer for 12 months on purchases also adds flexibility, allowing cardholders to make new purchases without immediate interest concerns. While the card does not offer cash-back rewards or a welcome bonus, its strength is its simplicity and the potential for significant interest savings. The balance transfer fee of $5 or 3%, whichever is greater, is a standard rate and should be considered when evaluating the overall benefit of transferring balances to this card. The Citi Simplicity Card is particularly well-suited for those prioritizing a lengthy interest-free period for their balance transfer needs, offering a straightforward and cost-effective approach to managing debt. Not only is credit card interest expensive, but it's as high as it's ever been. Today's average credit card interest rate is over 21% — higher than at any other point since the Federal Reserve began tracking rates in the 1990s. For those who carry a balance on their card, the average is more than 23%. Credit cards with 0% APR on balance transfers can offer significant savings compared to standard double-digit interest rates. Maximize your balance transfer savings by paying your balance in full before the intro period ends. If you can't pay the balance within the 0% APR period, you can still shave months and potentially thousands of dollars from your debt payoff. Your total savings will depend on a few details, including the length of your intro period and how much you can pay each month. Let's say you have a credit card balance of $5,500 today — just below the average balance for U.S. households with credit card debt, according to the Federal Reserve Bank of St. Louis. That balance is all on a credit card earning 21% APR. Here's what your journey to pay down debt could look like over a few different scenarios: Minimum payments: This is by far the most costly option. Making only minimum payments, you would add nearly $9,000 in interest over more than two decades before paying your balance off in full. Total paid: $14,499 Fixed monthly payment: You can minimize costs by paying more than your monthly minimum, even if you cannot pay your balance in full. Maybe you can afford to contribute a fixed payment of $200 each month toward your debt. In this case, you'll pay your balance in full after three years, but still add more than $2,000 to your total balance. Total paid: $7,566 Now, let's see how a balance transfer credit card could make a difference in your $5,500 debt. This card comes with an 18-month 0% introductory APR and a 3% balance transfer fee (more on that below). After the intro period, you'll take on the same 21% APR. Pay in full: If you can put at least $314 toward your credit card bill each month, you could wipe out your balance in full by the end of the intro period without paying any additional interest. The only payment added to your principal is the 3% fee when you transfer, equal to $165. Total paid: $5,665 Fixed monthly payment: If the amount you need to pay in full is out of your budget, you can still save with a balance transfer offer. Maybe you can afford the same $200 monthly payment as before the transfer. Over the introductory period, you would pay down $3,600 of your principal balance, lowering your debt to $2,065. Once the APR starts to accrue, you could cover the remainder in one year with only $235 in added interest. Transferring your balance would allow you to pay your balance in full over 30 months and with about $400 in added interest and fees. Total paid: $5,900 There are many factors to consider for a balance transfer credit card, most notably whether this is the right tool to help with your debt repayment journey. Make sure you're considering balance transfer credit cards that match your financial goals. Here are a few details to look for: Introductory APR: Credit cards offer introductory APRs for new cardholders, either on new purchases or balance transfers (or both). The introductory rate for many balance transfer cards is 0% over a given intro period, which can help you pay down your existing balance without interest. Regular APR: APR stands for annual percentage rate, the percentage you get charged by the credit lender each payment period you carry a balance. This will likely be different than your intro rate. Credit cards typically have variable APRs, which means your rate goes up and down over time. Transfer period: On some cards, balance transfers are only eligible for 0% APR offers when you transfer your balance within a given time frame: within 60 days of account opening or 120 days of account opening, for example. While it makes sense to transfer your debt as soon as possible to take advantage of the full intro period, you'll also want to keep any time limits like this in mind, so you don't miss out on the offer. Issuer: You generally won't be able to transfer a balance from one card account to another card account with the same bank. Look for balance transfer offers from different credit card issuers than the card on which you have an existing debt balance. Annual fees: Your issuing bank might charge an annual fee for your card, though annual fees aren't common among top balance transfer cards. If you do choose a card with an annual fee, you should make sure you're getting enough value to offset the yearly cost. Balance transfer fees: If you want to transfer debt to an existing balance from one credit card to another, the new card issuer can charge you a fee. This is usually a percentage of your transfer amount ranging from 3% to 5% with at least a $5 minimum. Your credit score: Balance transfer credit cards generally require a good credit score. A credit score is a number that represents your credit health, and is based on the information in your credit report. You can request a free credit report from each of the three major credit bureaus (Equifax, Experian, and TransUnion) These reports contain your credit history, like how many credit card accounts you've had. Credit scores range from 300-850. Above around 700 is considered good, and above 800 is considered excellent — the higher your score, the more likely you are to qualify for great loan terms and rewarding credit cards in the future.A balance transfer credit card can save you money, but you should still prepare for the potential costs you'll incur. Balance transfer cards don't typically carry an annual fee. However, there is often a fee for transferring your balance. Balance transfer fees can range from 3%-5% of your overall balance, usually with a minimum of around $5 or $10. Say you want to transfer a $3,000 balance to a card with a 0% intro APR and a 3% balance transfer fee. The balance transfer would cost you $90 in total. The larger your balance, the more you'll pay for the balance transfer. Still, these fees are likely only a small fraction of the interest you would otherwise pay. Some balance transfer credit cards waive this fee. If you have a very high balance that could lead to a costly fee — or you want to avoid any added cost altogether — you may want to focus on balance transfer cards with no fee. Balance transfers have pros and cons. While benefits include the intro APR offer for debt payoff, cons include balance transfer fees and potentially few. 0% introductory APR: With no-interest balance transfer credit cards, any payments you make throughout the intro period will go directly toward your principal balance. Instead of interest making it more challenging to pay off your debt, you can use this tool to eliminate the underlying balance. No annual fee: The best balance transfer cards available today have no annual fee, so you don't have to worry about any additional cost of owning the card. Debt consolidation: If you have balances spread across multiple credit cards, you may be able to consolidate them onto a single balance transfer card. Not only can you benefit from the period of interest-free payments, but you'll also minimize the number of individual monthly payments you need to remember. Just make sure the total transferred balance is less than your card's credit limit. Risk of not paying your balance off in full: You may not be able to maximize your balance transfer if you cannot prioritize your monthly payments over the intro period. These cards work best if you can commit to paying down a significant portion of your balance over the 0% APR offer. Otherwise, you'll be left with a growing balance once again when your regular interest rate begins. Balance transfer fees: The fees issuers charge to make your transfer can add to your overall balance. But for most cardholders, a 3% or 5% fee will still be far less than the amount you would otherwise accrue in interest charges. Credit limits: Make sure you know the credit limit of your balance transfer credit card before you attempt to make your transfer. If your existing debt is more than the limit, you won't be able to transfer the entire balance. Take advantage of your new card. Not only is a balance transfer credit card a great way to pay down debt, but it can also set you up for a better financial future. Here are three things you should do when you open up a new card: The introductory period on your balance transfer card only lasts so long. Take full advantage by transferring your balance as soon as possible after approval. If your new credit card offers an 18-month 0% APR intro period but you wait two months to make your transfer, paying down your debt in that shorter time frame will be more difficult. Some balance transfer cards even require you to transfer your balance within a specific timeframe. For example, your card agreement may specify that the 0% APR offer applies to transfers made within the first 30 days of account opening. Alternatively, you could take on a more significant balance transfer fee the longer you wait. For example, there may only be a 3% fee for balances transferred within 60 days of account opening, but a 5% fee for balances transferred after that time. Always read the fine print of an introductory balance transfer offer before opening your account so you can avoid any surprises that may set you back. Throughout the intro period, prioritize paying down your debt without making new purchases that increase your balance. If you're adding to your balance throughout the 0% APR period, you'll only leave yourself with more to pay off. Instead, focus on buying only what you can afford to pay in full. Whether you make purchases with another credit card, use your debit card, or pay with cash, ensure you have enough money in the bank to cover your spending. This may also help you become more aware of any spending habits that led to taking on the debt in the first place, so you can avoid ending up in the same place again. If debt payoff is your priority, long-term rewards or benefits may not be the biggest concern when choosing your balance transfer card, but they are worth considering. Balance transfer credit cards with the longest introductory 0% APR periods (up to 21 months) typically offer few ongoing benefits. They are designed for cardholders looking to pay off as much debt as possible over a more extended period. On the other hand, credit cards with balance transfer offers and ongoing rewards or other benefits tend to have slightly shorter intro periods of around 12 to 15 months. Even after you pay down your debt, these cards can offer long-term value on your everyday purchases. Just make sure you plan to avoid overspending and taking on debt you can decide if opening a new account is right for you. A balance transfer credit card can help if you're in debt or have high-interest debt. But you should always consider all the options that could help you pay down debt balances and know the potential risks involved. Think about these things before you make your decision: A balance transfer isn't your only option for debt payoff. Consolidating debt with a personal loan may be a better option for some people. If your debt far exceeds the credit limit on a new balance transfer card or you need more time than 0% APR intro periods offer today, opting for a personal loan with a fixed APR lower than your current credit card could be a good solution. Not only do you need good credit to qualify for a balance transfer card, but a balance transfer itself can also potentially affect your credit. For one, when you open any new credit card (including a balance transfer card), the required hard inquiry on your credit could lead to a small, temporary credit score drop. To keep multiple applications from sinking your score, only apply for cards you're confident you'll qualify for or get prequalified before applying. Another potential credit impact involves your credit limit. If you transfer a debt balance that makes up nearly your entire credit line, you could increase your credit utilization ratio — the amount of credit you're using compared to the amount you have available. This is one of the most influential factors in your credit score; the lower it is, the better. However, if you can keep up with your payments and begin to quickly bring down your balance over the intro period, you can mitigate the negative effect and balance the ratio.A good plan is the most important thing you can have before opening a balance transfer credit card. Using your card details (length of intro period, balance transfer fee, etc.), determine precisely how much you need to pay each month to eliminate your balance in full before the 0% APR period ends. If necessary, look at your budget and spending before you apply to find areas where you can reduce spending to dedicate more toward your monthly payments. If you can't pay off your balance completely, think about what next steps you'll take once interest kicks in to keep the remainder from growing out of your control. And don't forget to rethink your spending over the long term to ensure you don't wind up with another debt balance in the future. Practicing good credit habits and spending only what you can afford is the best way to take advantage of the rewards and benefits of credit cards without paying the price tag of high interest rates. Balance transfer cards can be a savvy financial move if you're looking to tackle high-interest debt. By transferring your existing debt to a card with a 0% introductory APR, you stop accruing interest and only make payments toward the principal balance. However, if you can't clear the balance before the introductory period ends, you'll face the card's standard APR on the remainder. You should be confident you can make a significant difference in your balance before this ongoing interest kicks in to make the balance transfer worth it. It's also important to note that most balance transfer credit cards come with a transfer fee — usually 3%-5% of the amount transferred — which adds to your costs. Navigating a balance transfer can be tricky; you need a solid strategy to maximize it. First, find a balance transfer card that offers a long 0% introductory APR period — ideally, 15 to 21 months. The longer this no-interest period lasts, the more time you have to pay down your balance without worrying about interest charges. Also pay attention to the balance transfer fee; most balance transfer cards will have at least a 3% fee that you should be prepared to add to your total amount due. Once you've opened your new card, transfer the balances from your highest-interest credit cards first to maximize savings over the 0% APR period. Double-check your balance transfer limit before you start so you don't attempt to transfer more than the card allows. Prioritize paying more than the minimum payment each month. To truly take advantage of the 0% APR, calculate how much you must pay monthly to clear the debt before the introductory period ends. If you just stick to the minimum, you likely won't reduce the balance by much. Never make a late payment on your balance transfer card. One missed payment could mean losing your 0% APR and being hit with a much higher penalty APR, along with late fees. Set up autopay or reminders to ensure you never miss a due date. Avoid using your new card for new purchases while you pay down the balance. Keep your spending in check and focus solely on paying off the debt you transferred. Finally, don't get caught off guard when the 0% APR period expires. If you think you won't be able to pay off the full balance by then, start planning ahead for how you'll continue paying down your debt. A balance transfer can temporarily lower your credit score because it triggers a hard inquiry by the card issuer on your credit report. This is true for all new credit applications, not just balance transfer cards. A balance transfer can also affect your credit utilization ratio, potentially lowering your score if the balance transferred to your new card represents a large percentage of its limit. Credit utilization, which measures how much credit you're using compared to your total available credit, is a major factor in calculating your credit score. your credit score. It's best to keep this ratio under 30%. The good news is that if you use a balance transfer card wisely — by paying down your balance and avoiding more debt — your credit score should improve over time. Like most credit cards, the higher your score is, the better your chances of getting the best available balance transfer offers with long 0% APR periods and other benefits. In general, you're most likely to qualify for a balance transfer card with a good-to-excellent credit score. According to FICO, that means a score of at least 670 and up to the maximum 850 credit score. With a solid credit score (especially one closer to the 'excellent' end of the range around 750 or higher), you can usually score the best balance transfer terms, a relatively lower interest rate after the intro period, and additional perks like cash-back rewards and a sign-up bonus. To create our list of the best balance transfer credit cards, we prioritized a holistic look at what these cards offer cardholders, even after the intro period ends. First and foremost, though, we analyzed the details of each card's balance transfer offer. This includes the length of the intro period for balance transfers, the balance transfer fee, and whether it also has an intro period for new purchases. We also rated each card on other features that may apply throughout the intro period and beyond: the ongoing variable APR, any rewards on spending, annual fee cost, and credit score access. Finally, we reviewed customer service, security, and accessibility features that apply to any of our card rankings. These include mobile app reviews, fraud monitoring, number of ways to contact the issuer, and more. Using this system, we evaluated more than two dozen credit cards from major issuers with balance transfer offers available today. The cards we looked at are widely available for American consumers (with the credit to qualify), no matter where you're located or what institution you bank with. Of course, not everyone looking for a balance transfer credit card is interested in long-term rewards and benefits. For some, finding the longest intro period available to begin paying down debt is more important than any ongoing card features. While the cards with today's longest intro periods (typically 18 to 21 months) generally scored lower in our overall ranking system because of their lack of ongoing value, we did want to include them on our list. In the 'more cards to consider' section, we include these cards, which offer the longest introductory periods and next-best overall scores after those cards that made the primary bring down your balance over the intro period quickly This article was edited by Rebecca McCracken Editorial Disclosure: The information in this article has not been reviewed or approved by any advertiser. All opinions belong solely to Yahoo Finance and are not those of any other entity. The details on financial products, including card rates and fees, are accurate as of the publish date. All products or services are presented without warranty. Check the bank's website for the most current information. This site doesn't include all currently available offers. Credit score alone does not guarantee or imply approval for any financial product.
Yahoo
05-03-2025
- Business
- Yahoo
The best 0% APR credit cards for 2025: Avoid paying interest for up to 21 months
Here are the best options today and more about how to best use a 0% APR card. Why we like it: The Capital One Savor Cash Rewards is one of the best credit cards for everyday earning because of its excellent rewards rate. With uncapped and elevated 3% rates in multiple categories, you can earn high amounts of cash back on purchases you're already making, including groceries. As an added bonus for travelers, this card doesn't charge foreign transaction we like it: The Capital One VentureOne Rewards makes sense if you want to earn straightforward travel rewards on your everyday spending. With no confusing bonus categories and no foreign transaction fees, you can focus on earning miles for your next we like it: The 0% introductory rate might be the starting point with the Chase Freedom Unlimited, but it provides much more in ongoing potential, especially if you like flexible redemptions. With its higher base rewards rate and useful spending categories, you can fuel your travels with rewards earned from everyday purchases or opt for cash-back rewards. Why we like it: On top of its long intro APR offer, the Amex Blue Cash Everyday also provides an excellent mix of elevated rewards and ongoing benefits, all with no annual cardmember cost. While you might find a card with a few of these perks, it's rare to find one that has them we like it: The Amex Blue Cash Preferred has one of the highest cash-back rates available for making purchases in common spending categories, especially for a low-annual-fee card. This is an excellent card if you want to turn your everyday purchases into valuable cash-back we like it: The Wells Fargo Reflect is one of the best cards available for a long 0% intro offer on its APR. Having 21 months of 0% intro APR on purchases and qualifying balance transfers means you get, on average, six to nine months more time to avoid paying interest than other similar we like it: Few rewards credit cards provide more than 2% or 3% back on purchases, but you can earn up to 5% cash back with the Discover it Cash Back Credit Card. You do need to keep track of quarterly categories and activate them, but that's a small price to pay for the amount of rewards you can earn on common generally recommend the cards on our best list if you're looking for 0% intro APR offers, but here are some additional credit card offers that can work depending on your situation and preferences. Why we like it: The Citi Custom Cash makes sense if you want your rewards rate to reflect your top purchases each billing cycle. With this card, you earn 5% back in your top eligible category on up to $500 each billing cycle. That means you could earn 5% back on restaurants one month and 5% back on grocery stores after that, giving you plenty of flexibility with your earning we like it: The Bank of America Customized Cash Rewards lets you customize how you earn rewards by choosing a 3% cash-back category once per calendar month. This gives you some flexibility with earning more cash back as you align your choice category with your upcoming we like it: The U.S. Bank Cash+ Visa provides up to 5% cash back with its rewards rate, which is among the highest rates you can find on rewards credit cards. There's a limit on how much you can earn at this rate each quarter, but it's a reasonable cap of $2,000, especially for a no-annual-fee card. It's also nice that you have the option to choose two 5% categories each quarter, giving you flexibility over how you earn rewards. A 0% intro APR credit card lets you avoid paying interest on purchases for a set period of time. This allows you to carry a balance without worrying about racking up any interest until the end of the introductory period, though a high balance could affect your credit score and you're still responsible for making minimum payments. The intro period starts upon account opening and typically lasts 12 to 15 months, with some longer offers lasting 18 to 21 months. Unlike most balance transfers, you don't have to pay a fee to take advantage of a 0% purchase APR. However, you still want to pay off your balance before the promotional period ends. Otherwise, interest will start to accrue. Read more: What is APR on a credit card? 0% APR offer length: In general, the longer the intro period, the better. However, the average length of 12 to 15 months should be good enough for most people before the variable APR kicks in. Balance transfer offer: Many of the cards on this list are also balance transfer credit cards because they have 0% intro APR offers on balance transfers. You can take advantage of these offers to transfer existing debt to one of these cards and not pay interest during the offer period. You still have to cover a balance transfer fee and you can only transfer up to your available credit limit. Annual fee: We typically only recommend paying an annual fee on a credit card if you get enough value from the card's benefits to offset the yearly membership cost. Fortunately, the best 0% APR credit cards don't tend to have annual fees. Rewards program: What are you supposed to do with a 0% APR card after the offer period ends? If it's a rewards card, you can continue using it to earn valuable points, miles, or cash back on your purchases. Credit requirements: Many 0% APR credit cards require a good or excellent credit score to qualify, which is at least a 670 FICO score. APR: Most credit card annual percentage rates are high, so it's typically not best to choose between cards based on the APR unless there's a 0% intro APR offer. It can make sense to apply for a 0% intro APR credit card for multiple reasons: You have existing debt. You can use a 0% APR credit card as a way to help cover new purchases without accruing interest. This can give you some room in your budget to pay off existing debt. You have upcoming large purchases. You can use a 0% APR credit card to make a large purchase and then take your time (during the introductory offer period) to pay it off without interest building. This lets you hold onto cash for other necessary purchases while still making interest-free payments. It's an emergency. This type of situation can vary, like being between jobs, but you can use a 0% APR credit card to make necessary purchases without interest accruing. The important thing to remember is that 0% APR credit cards are still credit cards. When you use credit, you're borrowing money from a financial institution that you have to repay, whether there's interest or not. That means it's still essential to responsibly use credit cards by making on-time monthly payments by the due date and not borrowing more credit than you can afford. It's worth noting that carrying a large balance on a credit card, even during a 0% introductory offer period, can negatively impact your credit score because of high credit utilization, or the percentage of the total amount of credit you're using. Credit cards with long 0% introductory APR offers include: Blue Cash Everyday® Card from American Express Chase Freedom Unlimited® Capital One Savor Cash Rewards Credit Card Wells Fargo Reflect® Card Discover it® Cash Back Citi Custom Cash® Card Bank of America® Customized Cash Rewards Credit Card U.S. Bank Cash+® Visa Signature® Card Getting approved for a new card with a 0% intro rate can be an excellent way to reduce credit card debt. The promotional period lets you pay your balance without worrying about interest charges, which is often better than alternative repayment strategies, such as using a cash advance from another credit card. You typically need good to excellent credit to qualify for a 0% APR credit card. That's a FICO score of at least 670 and a VantageScore of at least 661. A higher credit score could improve your chances of getting approved for a 0% interest credit card. A 0% interest rate credit card can hurt your credit if your credit utilization is too high from carrying a high balance. You could also see a small impact on your credit score from applying for a new card. However, a 0% intro APR credit card could help with building credit over time and increasing your overall creditworthiness if you keep your card account active and make on-time payments. To find the best 0% APR cards today, we started with a list of all cards from major credit card issuers that offer an introductory 0% APR, which was nearly 30 eligible credit cards. This list did not include every available card from every credit card company. We added the cards from this list to a rubric to rate each card based on various criteria, including 0% intro APR periods, rewards, annual fees, and more. Our final list includes highly-rated cards, based on our rubric, experience, and expert opinion, that we think could make sense for people researching 0% APR credit cards. Editorial Disclosure: The information in this article has not been reviewed or approved by any advertiser. All opinions belong solely to Yahoo Finance and are not those of any other entity. The details on financial products, including card rates and fees, are accurate as of the publish date. All products or services are presented without warranty. Check the bank's website for the most current information. This site doesn't include all currently available offers. Credit score alone does not guarantee or imply approval for any financial product.
Yahoo
05-03-2025
- Business
- Yahoo
How to consolidate credit card debt
Consolidating your credit card debt can help you organize everything into a single monthly payment and save money with a lower overall interest rate. Two popular strategies include using balance transfer credit cards and debt consolidation loans. Debt consolidation is combining all your existing debt in one place. You can consolidate credit card debt with a balance transfer credit card or loan from a bank or another financial institution. Related: Best ways to pay off credit card debt Credit card debt consolidation is right for you if it helps pay off your debt. The point of debt consolidation is to lower your interest charges and organize your debt in one place so it's easier to track. If available debt consolidation strategies can't lower your overall interest rate, consider other debt-payoff strategies, including budgeting. Credit card debt consolidation pros It can organize your debt into one monthly payment It can save you money with a lower interest rate It can help you get out of debt quicker It can improve your credit score with on-time payments Credit card debt consolidation cons It can temporarily impact your credit score if you apply for new credit accounts or have a high credit utilization It might not help you get out of debt You might not qualify for the best offers You can transfer existing debt from multiple sources to a balance transfer card and then manage your debt in one convenient location. This typically only makes sense if the card you're transferring debt to is a 0% APR credit card. A credit card with a 0% introductory APR (annual percentage rate) offer on balance transfers lets you avoid paying any interest on transferred balances for a certain amount of time. You still have to pay a balance transfer fee on most cards, but it could be worth paying if you save more money on interest. Consider the difference between paying off credit card debt with and without using a balance transfer card with a 0% intro APR offer. Scenario A Scenario B Scenario C (0% APR offer and high payment) No 0% APR offer and minimum payment 0% APR offer and minimum payment 0% APR offer and minimum payment Debt $10,000 $10,000 $10,000 Interest rate 20% 0% intro APR for 12 months 0% intro APR for 12 months Balance transfer fee (5%) N/A $500 $500 Monthly payment $265 $267 $850 Time to pay off 59 months 49 months 12 months Interest paid $5,893 $3,029 $0 Total paid $15,893 $13,529 $10,500 The examples above show how a balance transfer offer could save you money, even if you don't fully pay off your balance during the 0% intro APR period. However, we recommend paying as much of your debt off as possible during the promotional period, as that will save you the most money on interest. Check out our reviews of each card: Chase Freedom Unlimited: How to get an extra $300 back in your first year Capital One Savor Cash Rewards review: Unlimited cash back for no annual fee Amex Blue Cash Preferred Card review: Big grocery rewards and more everyday savings A credit card debt consolidation loan can be used to pay off your existing debt so you have one monthly payment and a lower rate. Consider the following debt situation where you could use a debt consolidation loan: Credit card 1 Credit card 2 Credit card 3 Balance $20,000 $10,000 $5,000 Interest rate 20% 18% 25% Average interest rate 21% Total balance $35,000 If you qualify for a sufficient loan amount and favorable loan terms, you could save on interest as you work to pay off your debt. Even better, you would only have one payment to worry about rather than three. Debt consolidation loan requirements could include the following: A valid Social Security number Be at least 18 years old A physical address A minimum income that's determined by the lender (bank, credit union, or other financial institution) A good credit history and/or credit score (it's common for lenders to issue credit checks, which can temporarily impact your credit score and show up on your credit report) Personal loans can be used the same way as debt consolidation loans to organize your debt and save money on interest. Depending on the financial institution, a personal loan could be labeled as a 'debt consolidation loan.' That means they're the same thing and often have the same requirements. A home equity loan or home equity line of credit (HELOC) lets you borrow money against your home's equity. With a home equity loan, you receive a lump sum of money that you have to pay back with interest, typically at a fixed rate, over a certain number of years. A HELOC lets you borrow money from an open line of credit, and you pay interest on the amount borrowed. You can use either option to pay off credit card debt from multiple sources. The strategy with using these options is to make sure the amount you pay in interest is lower than what you're currently paying on your credit card debt. Home equity loan and HELOC requirements could include: Home equity A favorable debt-to-income ratio A positive credit history Sufficient income Paying closing costs A 401(k) loan lets you borrow money against your retirement savings. You have to pay the loan back with interest within a certain amount of time, and you could be on the hook for paying taxes and incur a penalty if you default on the loan (can't pay it back). We don't generally recommend taking out a loan against your 401(k) without careful consideration because it could derail your retirement savings plan. You would have to thoroughly review the situation to see if paying off debt with the money you'll likely need when you retire makes sense. Credit counseling organizations can offer debt management or debt repayment plans where you pay the organization and they make payments to your creditors. This could be a useful debt consolidation option for paying off different types of debt. That would only be the case if the organization negotiates with your creditors to lower your interest charges or balances due or negotiates other favorable terms of debt relief. Things to be aware of with credit counseling organizations: You might have to pay a fee for these types of services. Be sure to review the plan's terms and conditions, including repayment terms. Not all organizations are reputable, and scams do exist within this industry. The U.S. Department of Justice has a list of approved credit counseling agencies you can browse. Debt consolidation isn't the only way to take control of your debt and eventually become debt-free. As you consider your financial situation and options, keep these popular budgeting strategies in mind. The debt avalanche method focuses on paying off the debt with the highest interest rate first. As you pay off one debt, you move to the debt with the next highest interest rate. The point of this strategy is to save money by paying off the high-interest debt first and as fast as possible. Credit card 1 Credit card 2 Credit card 3 Balance $10,000 $5,000 $3,000 Interest rate 18% 25% 20% Using the debt avalanche method in this example, you would put your payments toward the balance on credit card 2 first, then credit card 3, and then credit card 1. The debt snowball method is similar to the avalanche method but focuses on paying off the smallest amount of debt first rather than the debts with the highest interest. This strategy aims to build momentum as you move from paying off one balance to another. It might not save as much money as the avalanche method, but it can help keep you motivated. Credit card 1 Credit card 2 Credit card 3 Balance $10,000 $5,000 $3,000 Interest rate 18% 25% 20% Using the debt snowball method in the same example, you would put your payments toward the balance on credit card 3 first, then credit card 2, and then credit card 1. Related: What's more important — Saving money or paying off debt? Debt consolidation can hurt your credit score if you apply for a new balance transfer card or debt consolidation loan. Your score could also go down from high credit utilization on a balance transfer card, as well as a new credit account lowering the average age of your accounts. However, these effects are typically temporary, especially if you make on-time payments as you work to pay off your debt. Debt consolidation can be worth it if it helps you pay off your credit card debt. The purpose of debt consolidation is to organize all your debt in one place at a lower interest rate than what you were collectively paying before. It's likely worth it if you can do this with a balance transfer card or loan, owing less money overall and making it easier to track payments. Consolidating credit card debt has two purposes: it lowers your overall interest rate on all your debt and organizes it in one place. This makes tracking your payments easier and lowers the interest you pay throughout the debt-payoff process. It depends on the financial institution and their requirements, but you typically need to provide personal and financial information, often including your Social Security number and income. Your credit history and debt can also factor into the qualification process, so having a good credit score is typically beneficial. Some of the best methods to consolidate credit card debt include using balance transfer credit cards and loans. With either of these options, you can consolidate your debt in one place, making it easier to track. However, debt consolidation typically only saves you money if it also lowers your overall interest rate. This article was edited by Rebecca McCracken Editorial Disclosure: The information in this article has not been reviewed or approved by any advertiser. All opinions belong solely to Yahoo Finance and are not those of any other entity. The details on financial products, including card rates and fees, are accurate as of the publish date. All products or services are presented without warranty. Check the bank's website for the most current information. This site doesn't include all currently available offers. Credit score alone does not guarantee or imply approval for any financial product.
