Credit cards with low interest rates and no annual fee

All information about the American Express Cash Magnet® Card, the State Department Federal Credit Union Platinum Rewards Credit Card, the Amex EveryDay Credit Card from American Express and the Air Force Federal Credit Union Visa Platinum Card has been collected independently by CreditCards.com. The issuer did not provide the content, nor is it responsible for its accuracy.

Editor’s picks: Low-interest credit card details

Discover it® Cash Back: Best for low interest

Why we picked it: The Discover it Cash Back, like several other Discover cards, offers a low regular interest rate of 14.99% to 25.99% variable APR, ideal for the occasional balance.

Pros: The ongoing rewards and the first-year bonus feature are impressive: 5% cash back on rotating quarterly categories (up to $1,500 in combined quarterly purchases in various categories upon activation, then 1%), and Discover will match all the cash back you earn at the end of your first year. Add to that, there is no annual fee.

Cons: Unfortunately, purchase and travel benefits are nonexistent. Plus, there’s no traditional sign-up bonus on this card. Instead it matches the cash back you earn in the first year. That means you’ll be waiting a year for that bonus rather than receiving it within the first one to three months as is typical.

Who should apply? With an incredible cash back rate, this low-interest card offers a lot of potential value to those who can make the most of its rotating quarterly bonus categories. You’ll need to have good or excellent credit (670 or higher) in order to be approved.

Who should skip? If you’re looking for instant gratification by way of a massive welcome bonus, this card’s end-of-first-year cash back match may not be for you. Likewise, travelers hoping for perks and benefits won’t get much out of this card beyond cash back.

Read our Discover it® Cash Back review.

Citi Rewards+® Card: Best for everyday purchases

Why we picked it: Citi is offering a generous sign-up bonus: Earn 20,000 bonus points after spending $1,500 within the first three months of account opening. That is worth $200 in gift cards. Cardholders also get a 0% introductory APR on purchases and balance transfers for 15 months. After that, the card’s APR is 17.24% to 27.24%, variable. There’s no annual fee.

Pros: The Citi Rewards+® offers something unique: Not only will you earn 2X ThankYou points at supermarkets and gas stations (on up to $6,000 per year in purchases, then 1 point per dollar) as well as 1X points on all other purchases, but every purchase you make will be rounded up to the nearest 10 points. This feature helps you get more rewards out of every purchase, no matter how small.

Cons: One potential downfall lies in its redemption options: If you want to get the most value out of your rewards, you’ll have to redeem your points for travel purchases (which can only be booked through the ThankYou Travel Portal) or gift cards.

Who should apply? If you’re searching for a straightforward low-interest balance transfer card, the Citi Rewards+ is a strong contender. This card is an excellent option for balance transfers with the potential to maximize rewards on small purchases, particularly if you’re an existing Citi customer.

Who should skip? Someone hoping for a long list of redemption options or fancy perks may be disappointed with this minimal frills card. Big spenders could potentially earn more with a card that rewards for a wider range of bonus categories.

Read our Citi Rewards+® Card review.

Citi® Double Cash Card: Best for cash back

Why we picked it: The Citi Double Cash Card has one of the longest balance transfer intro APR offers, with 0% for 18 months, then 17.74% to 27.74% variable after that. This means you’ll be making interest-free payments on balance transfers well into 2023.

Pros: The Double Cash’s ongoing rewards of 1% cash back when you spend, then another 1% as you pay for the purchase make it top of the line among flat-rate cash back cards.

Cons: As superior as the Citi Double Cash’s rewards are, its lack of a 0% intro APR on purchases may give you pause.

Who should apply? This card is a great choice for a flat rate rewards card with the potential to maximize earnings on everyday purchases, especially if you’re already a Citi customer.

Who should skip? Anyone looking to pay off a large purchase will be disappointed in the lack of a 0% intro APR offer on purchases. Also, if you don’t have a credit score of 670 or higher, you’re better off looking for a different rewards credit card.

Read our Citi® Double Cash Card review.

Discover it® Miles: Best for airline miles

Why we picked it: You can temporarily avoid interest on new purchases, thanks to this card’s 15-month 0% introductory APR offer on purchases (14.99% to 25.99% variable APR after). If you’re planning overseas travel, you’ll also appreciate the lack of foreign transaction fees.

Pros: This Discover travel card earns 1.5 miles per dollar on all purchases, and Discover will match the miles you’ve earned at the end of your first year – all without an annual fee.

Cons: There are two potential drawbacks: Miles can’t be transferred to frequent flyer loyalty programs, and there are no annual bonuses beyond the first year miles Match.

Who should apply? Globetrotters and even infrequent budget travelers will love the flexibility and overall value of this low-interest travel rewards card.

Who should skip? If you’re particularly loyal to one airline or a certain alliance, you’re probably better off going with a carrier co-branded credit card. And if travel is not your main spending category, look into rewards cards that offer 3% to 5% back in the categories that do matter to you.

Read our Discover it® Miles review.

Blue Cash Everyday® Card from American Express: Best for families financing a big purchase

Why we picked it: The Blue Cash Everyday offers a 0% intro APR for a lengthy 15 months on purchases. It’s a 17.74% to 28.74% variable rate after that. New cardmembers can also earn up to $250: Earn 20% back (up to $150 in statement credits) on purchases with PayPal merchants in the first six months of card membership. Plus, earn a $100 statement credit after you spend $2,000 in the first six months of card membership. Those are impressive perks for a card with no annual fee.

Pros: With the Everyday, you can earn 3% cash back at U.S. supermarkets, U.S. gas stations and on U.S online retail purchases (on up to $6,000 in purchases annually in each category, then 1%), and 1% cash back on general purchases.

Cons: You’ll get a higher rewards rate with the Blue Cash Preferred® Card from American Express, though you’ll have to pay an on going $95 annual fee ($0 intro annual fee for the first year).

Who should apply? In addition to its long intro period and low interest rates, cost-conscious families will appreciate the cash back rates at U.S. supermarkets and U.S. gas stations. This card requires good or excellent credit (670 or higher) for approval.

Who should skip? Those who regularly shop at BJ’s or Costco might want to consider another card since these types of wholesale clubs don’t count toward the Blue Cash Everyday’s U.S. supermarket category.

Read our review for the Blue Cash Everyday® Card from American Express.

Citi® Diamond Preferred® Card: Best for balance transfers

Why we picked it: It offers one of the longest introductory APR periods on balance transfers currently available: You’ll get a whopping 21 months without paying interest on balance transfers completed within the first four months (the card’s APR is 16.74% to 27.49% variable after that).

Pros: While there’s no base rewards program, the card does carry some of the benefits associated with popular Citi credit cards, including Citi Easy Deals and Citi Flex Plan. Also, for a limited time you can earn a $150 statement credit after you spend $500 on purchases in the first three months of account opening.

Cons: The card does charge a balance transfer fee of 5% (or $5, whichever is higher). You can save a significant amount if you opt instead for a balance transfer card that charges no balance transfer fee at all.

Who should apply? The extra-long introductory offer makes this a fine card for anyone primarily concerned with tackling a debt via balance transfer.

Who should skip? If earning rewards and other frills are high on your must-haves, the Citi Diamond Preferred may leave you underwhelmed.

Read our Citi® Diamond Preferred® Card review.

Upgrade Cash Rewards Visa®: Best for managing payments

Why we picked it: This card has a special feature designed to help with making regular, on-time payments. Your balance is automatically put into an installment plan with a fixed monthly payment so that you know exactly how much you’re paying. With a regular APR of 14.99% to 29.99%, cardholders who qualify for the low end may see some benefit.

Pros: Additionally, there are no fees of any kind, and you’ll earn 1.5% cash back on your purchases when you make a payment.

Cons: This card does not offer an introductory 0% interest window and does not allow for balance transfers, making it a less-than-stellar option for those looking to manage debt from an existing credit account.

Who should apply? If you have a tendency to make only the minimum payment, the Upgrade Card’s automatic installment feature can help keep balances in check, deter overspending and reward you with an unlimited 1.5% cash back every time you complete a payment.

Who should skip? Anyone mulling over a potential balance transfer should keep looking, as it’s not an option with this card. The flat-rate 1.5% cash back on purchases (when you make a payment) may not be the best match for big spenders looking to maximize top spend categories.

Read our Upgrade Cash Rewards Visa® review.

Bank of America® Customized Cash Rewards credit card: Best for flexible cash back categories

Why we picked it: This card comes with top-tier rewards and a $200 online cash rewards bonus (after making at least $1,000 in purchases within the first 90 days of account opening). There’s also an introductory 0% interest period of 18 billing cycles for both balance transfers made within the first 60 days and purchases (16.99% to 26.99% variable APR after).

Pros: This card offers cash back rewards that are almost guaranteed to fit anyone’s spending: Earn 3% cash back in a category of your choice (gas, dining, travel, drug stores, online shopping or home improvements and furnishings), 2% back at grocery stores and wholesale clubs – with a $2,500 combined spending limit on 2% and 3% categories each quarter – and 1% cash back on all other purchases.

Cons: A 3% fee (minimum $10) applies to all balance transfers.

Who should apply? If you want a card with no annual fee, flexible rewards rate, decent sign-up bonus and lengthy balance transfer offer, the Bank of America Customized Cash Rewards card checks off all the boxes. Plus, existing Bank of America customers can maximize their potential rewards through card-linked offer programs such as BankAmeriDeals.

Who should skip? The limited rewards options may not win over travelers, and the quarterly $2,500 combined spending cap on 2% and 3% categories may not be the best fit for big spenders.

Read our review of the Bank of America® Customized Cash Rewards credit card.

Navy Federal Credit Union Platinum card: Best low-interest credit union card

Why we picked it: With an APR of 5.99% to 18% variable, the Navy Federal Credit Union Platinum card boasts one of the lowest interest rates available. Also worth noting: it charges no annual fee, no foreign transaction fees, no cash advance fees and – a rarity – no balance transfer fees. Cardmembers enjoy a 12-month 0% introductory APR on balance transfers requested within 30 days of account opening (offer expires January 3, 2022). After that, the 5.99% to 18% APR variable applies.

Pros: Aside from its incredibly low fees, this card includes a range of benefits including collision damage waiver, travel and emergency assistance, cellphone protection and other frills.

Cons: In order to apply, you must first join the Navy Federal Credit Union. That requires you to have military ties through family, be currently in the armed forces or employed by the Department of Defense or have veteran status. Another potential sticking point: this card doesn’t have a rewards program.

Who should apply? Anyone who is eligible to open an account and apply for this card stands to save a ton in fees, particularly if they plan to carry a balance or take advantage of the introductory balance transfer offer.

Who should skip? If you’re hoping to rack up rewards, this card’s lack of a rewards program will be an absolute deal breaker. Plus, the membership requirements may prevent you from joining in the first place.

Read our Navy Federal Credit Union Platinum card review.

State Department Federal Credit Union Platinum Rewards Credit Card: Best low-interest credit union card with rewards

Why we picked it: Aside from having one of the lowest interest rates at 6.99% to 14.99% variable APR, the SDFCU Platinum Rewards Credit Card offers 1X Flexpoint Rewards on every purchase. Flexpoints are indeed flexible and can be redeemed for travel, gift cards, merchandise as well as charitable donations.

Pros: There’s no annual fee and no fees for balance transfers or foreign transactions.

Cons: While its low rates and lack of fees are enticing, the barriers to gaining membership could be a major deterrent for some. This card requires a State Department Federal Credit Union membership, which is limited to employees and on-site contractors of the State Department, those with familial or household ties to a State Department employee, plus an extensive list of State Department organizational affiliations. Members of the American Consumer Council are also eligible to join, which, for most would-be applicants, is probably the easiest route. This requires you to be an American consumer who currently uses or has purchased a major consumer product or service within three years of submitting an application for membership, plus $8 annually or $15 for a lifetime membership.

Who should apply? Anyone willing to jump through the hoops of eligibility can save a lot of money in fees, particularly frequent travelers or someone considering a balance transfer.

Who should skip? The membership requirements may be too much of a barrier for many. Reward-seekers should probably look elsewhere, as this card doesn’t have much to offer beyond its favorable interest rates.

Air Force Federal Credit Union Visa® Platinum credit card: Best low-interest credit union card

Why we picked it: The Air Force Federal Credit Union Visa® Platinum credit card offers a very low interest rate of 7.75% to 14.75% variable and charges no annual fee.

Pros: The balance transfer fees aren’t quite as good as, say, the Navy Federal Credit Union Platinum card, but 2% (or $2, whichever is greater) is better than what’s offered by most cards on the market.

Cons: Eligibility is awfully narrow. Membership to the credit union is open to those affiliated with the armed forces, be it through family or past service. Another potential path: you live in, conduct business in, or worship in Bexar County, Texas or Clay, Lowndes, or Oktibbeha counties in Mississippi. Employment at certain companies, volunteer work, and membership at certain churches could also get you in. There are additional exceptions.

Who should apply? If you happen to meet the membership requirements, this card could save the right person a fair amount in interest and fees.

Who should skip? As with the other military cards on this list, the membership requirements may be too much of a barrier for many. While this card does offer rewards, they may be pretty minimal compared to what you might get with other cards, especially if you spend quite a lot.

Comparing the best low APR credit cards

What is a low-interest credit card?

Low-interest credit cards can be cards with introductory offers for purchases and balance transfers, usually 0% interest for a certain amount of time. But they can also be credit cards that have a low ongoing interest rate.

Credit card interest is the amount that you are charged when you don’t pay your credit card balance in full at the end of each month. Your interest rate will be stated as an APR, or “annual percentage rate.” This is the yearly cost of borrowing money.

A high interest rate is one of the biggest reasons people get in over their heads. Using our payoff calculator, if you owe $3,000 and you are paying a rate of 16.5% APR, then it would take you 45 months to pay the minimum amount of $90, and you would end up paying $1,041 in interest alone.

If you pay your credit card balance in full, your interest rate doesn’t matter much because you won’t be charged any interest. But a credit card with a low interest rate can save you hundreds or even thousands of dollars in the long run if any of the following apply to you:

• You often carry a balance from month to month on your credit card.
• You want to do a balance transfer to pay down credit card debt.
• You have to make an emergency purchase and need time to pay off the balance.

What is the average interest rate on a credit card?

Currently, the national average interest rate for credit cards is 16.13%. But with interest rates expected to increase this year, credit card rates are likely headed higher.

For now, low-interest credit cards currently average 12.94%. That means people with good-to-excellent credit are able to find cards that fall well below that national average. Unfortunately, the average interest rate for people with bad credit sits at 25.80. So if your credit score needs a lot of work, it could be a struggle to get approved for a credit card with a good interest rate.

How to get a credit card with low interest

If you think a credit card with a low interest rate is right for you, there are some steps you’ll need to take before you start applying. To help improve your chances of getting approved, do the following:

Step one: Focus on your credit score

The better your credit score, the better your chances of getting approved for a credit card with a low interest rate. So get your credit score and your credit report and look them both over.

To improve your credit score, there are a number of steps you can take. These include:

• Pay all your bills on time
• Pay down debt and maintain a low credit utilization ratio
• Check your credit report for errors

Step two: Research and compare credit cards

What type of credit card are you looking for? A low-interest credit card with no annual fee? One that offers a sign-up bonus and/or cash back rewards? No matter what you’re looking for, it’s important to find a credit card that has the features you want.

You can visit each credit card issuers website, or you can use a site like ours, which does the research for you. Whatever you decide, pay attention to the recommended credit scores for each credit card. And look to see if there is a pros and cons section to help show you the card’s best and worst features.

To make things easier, our compare credit cards tool or our CardMatch™ tool can help you find the right credit card for you based on your credit profile. This gives you a chance to see if you can qualify for special offers or pre-qualified matches without a hard credit check impacting your credit score.

Step three: Read the fine print

Before you apply for a low-interest credit card, make sure you understand the terms and conditions of the credit card. These include details on the card’s features, interest rates, as well as fees and penalties. You can find the terms and conditions on the card issuer’s website, on the specific card’s promotional page or application page.

Step four: Apply for the card that best matches your needs

When you’re ready, you’ll only want to apply for one credit card. As the credit reporting agency Experian notes, applying for multiple credit cards at once has two main drawbacks: It can hurt your credit score, and it suggests to creditors that you are more likely to take on more debt than you can handle and will be unable to make your payments. This can lead to you getting denied on your applications or getting an offer with a higher interest rate.

Want to know more? Here’s how to find and apply for a credit card that’s right for you.

Pros and cons of low-interest credit cards

Low-interest cards can help lessen the extremes and avoid fighting an uphill battle as you pay off credit card debt. But they’re not for everyone. To help you make an informed decision, take a look at these pros and cons of low-interest credit cards.

Pros

• A low interest rate makes carrying a credit card balance less risky and more affordable.
• A low interest rate offers less volatility than promotional 0% introductory rates.

Cons

• Low interest rate credit cards tend to be short on flashy perks and high-value rewards.
• The requirements for a low interest rate credit card generally skew toward excellent credit, which puts the best interest rates out of reach for those who need it most.

How to choose a low-interest credit card

Who should get a low-interest credit card?

• The debt holder. For those with credit card debt or any other outstanding high-interest debt, a balance transfer card can be a no-brainer. By moving debt to an introductory interest-free account, you can pay down your balance faster and save money.
• The plan-ahead spender. From renovations to travel plans, when you know you have to make large purchases in the near future and won’t be able to pay off the balance in a timely manner, a low-interest credit card can help minimize the debt. Some may even come with sign-up bonuses, which can help offset costs even further.
• The emergency spender. Emergencies happen, and an emergency fund is your best line of defense to cover these surprise expenses, followed by an interest-free loan or credit card with a long 0% intro APR. But when these options aren’t in the cards for you, a low-interest credit card can help cover emergency expenses. If you need to use a low-interest credit card, it’s a good idea to have a plan on how to pay off credit card debt.

Who should skip a low-interest credit card?

• The credit repairer. Our top low-interest cards require good or excellent credit, and it’s important to apply for a card that matches your credit. If you don’t have good credit, a low interest card may not be an option.
• The rewards strategist. While low-interest credit cards can offer rewards on everyday spending categories, the flashiest perks and highest-value rewards may be out of reach. If you want access to these benefits, consider a rewards or travel credit card.
• The balance-accumulator. With a low ongoing interest rate, it can be easy to get too comfortable with carrying a balance from month to month. You should always make an effort to pay as much as you can and view this low-interest period as an opportunity to pay off your current credit card debt and not a time to accumulate debt.

How to make the most of a low-interest card

Here are four steps to take to ensure you get the most out of your low-interest credit card:

• Pay on time. Making on-time credit card payments helps you to avoid unnecessary fees, which can push you further into debt. It also helps to improve your credit score because your payment history is reported to the major credit bureaus. A consistent record of on-time payments suggests to lenders that you are responsible, which can improve your chances of getting credit cards with improved perks.
• Pay in full. If you can, pay your credit card balances in full each month to avoid having any interest charges. But if you can’t, try to make the most of the low-interest card by avoiding any unnecessary spending as you work to pay off as much debt as possible.
• Use as many of the card’s benefits as possible.Even if you don’t have a rewards credit card, your card may have additional perks that can help save you money, like roadside assistance or special discounts on everyday items you normally buy. Make sure to take advantage of as many of the credit card benefits that you can.
• Ask for a lower rate. If you don’t have the lowest possible interest rate, ask your issuer to lower your credit card interest rate. If they say no, you can always ask again at a later time or try to apply for a new card with an even better rate.

From a declining stock market to labor shortages, there’s been no end lately to concerns over the economy. One topic on most people’s minds is the continuing rise of inflation, which has been eroding our purchasing power.

In an effort to combat rising inflation, interest rates are expected to rise three times in 2022. When that happens, it will be more expensive to carry debt on your credit cards — even low-interest credit cards.

CreditCards.com senior reporter, Poonkulali Thangavelu, has more information on the Federal Reserve’s plans to hike interest rates in 2022.

How we picked the best low-interest credit cards

Research methodology: It’s no surprise that when deciding on the best low-interest credit cards, we chose cards with low APRs. We also took the length of the introductory period into account, since a longer 0% intro APR period may reduce the total amount of interest accrued on a large purchase.

• Low APR: Does the card offer a low regular APR, intro APR and purchase APR? In the case of intro APRs, how long does the offer last? Does the rate remain low once the introductory term expires?
• Fees: Is there an annual fee and is it waived the first year? What fees are associated with balance transfers, foreign transactions, and cash advances? Are these fees competitive with similar cards on the market?
• Sign-up bonus, rewards and ancillary benefits: Do the rewards and sign-up bonus justify the costs of membership? If the card offers rewards, how do they stack up against similar cards in terms of value? Are rewards easy to redeem?

Our criteria also includes ease of application, customer service and miscellaneous features and benefits.

More information on low-interest credit cards

For more information on all things low-interest cards, continue reading content from our credit card experts:

• How do credit card APRs work?
• What is a good APR for a credit card?
• How credit scores affect interest rates

Robert Thorpe

Robert Thorpe is an editor for CreditCards.com

About the Editor

Jeanine Skowronski

Jeanine Skowronski is a credit card expert, analyst, and multimedia journalist with over 10 years of experience covering business and personal finance. She has previously served as the Head of Content at Policygenius, Executive Editor of Credit.com, Deputy Editor at American Banker, Staff Reporter at TheStreet and a columnist for Inc. Magazine.

About the Reviewer

Sally Herigstad

Sally Herigstad is a certified public accountant, author and speaker who writes about personal finance for CreditCards.com. She also writes regularly for MSN Money, Interest.com, Bankrate and RedPlum.com, and has been a guest on Martha Stewart radio and other programs.

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