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The credit card industry is booming; lenders are doing everything they can to try and entice consumers into taking on debt. Credit cards are a form of revolving credit, meaning they are unsecured and only have to be paid back if they are used. While this may sound great, it also means they have higher interest rates than traditional forms of credit. In recent years, credit card companies have begun to enhance the rewards on offer through their credit cards – it has done wonders in getting consumers to sign up for high-interest cards. This has had consequences for those who are irresponsible spenders, as they have worked their way into a debt trap that is hard to escape.

But there are other types of cards on the market as well – low-interest cards. These cards don’t offer the same types of rewards as traditional credit cards, but they allow their users the peace-of-mind that they won’t be trapped by high-interest debt if they begin to carry a balance on their card. If you’re someone who regularly carries a credit card balance on their card, you may benefit from having a low-interest card. It is very important to note that while these cards are ‘low-interest’, when compared to other forms of debt they are still high interest. This article will outline the various things to look for when deciding on a low-interest credit card. It will also provide the advantages and disadvantages of having a low interest credit card.

What to Look For

When applying for a low interest credit card there are two primary factors that you should consider: interest rate, annual fee, and interest calculation method.

  • Interest Rate – It may seem intuitive but the primary factor in deciding on which low interest credit card to choose should be the interest rate on the card. Low interest credit cards typically have interest rates between 11-14%, although there are some recent cards that have advertised rates of below 10%. If your card has an interest rate about 15%, it isn’t low interest.
  • Annual Fee – People searching for a low interest credit card should consider it a card that saves costs at all opportunities. That’s why it’s important that your low interest credit card also has no annual fee. Many rewards cards charge high annual fees, but a low interest card should have no annual fee – which is another great way to save money. Don’t be enticed by low interest cards with annual fees, there are plenty without them.
  • Interest Calculation Method – Most card providers will charge interest to the remaining balance on your card after you’ve made your monthly payment. But others will calculate an average balance for the month if you don’t pay your bill in full. If you have a choice, go with a card that only charges you interest on your remaining balance, it normally turns out much more affordable.


The advantages lie in the cost saving that you benefit from when you have a low interest credit card. If you carry a balance on your credit card, this is especially true. People get lured into high interest cards because of various rewards schemes and offers, but it means that they end up paying large amounts of money back over time due to the cost of the interest payments. If you’re looking for the most affordable way to have a credit card, your best option is most definitely a low interest credit card.


The primary disadvantage of a low interest credit card is simply the fact that you don’t get any rewards or benefits from holding the card. This is primarily true for people who pay off their balance in full, and therefore don’t end up paying interest. If you pay your balance off in full every month, it may be better to get a credit card that has a rewards program attached to it.


Low interest credit cards are some of the best cards on the market. Considering the majority of American credit card holders carry balances on their cards, low interest credit cards can save people serious money. If you do pay off your balance in full, you may want to consider a high interest rewards card as the added percentage will not impact you. Make sure to consider all the factors outlined in this article prior to deciding on the card to opt for.