This Is One of the Smartest Things You Can Do If You Carry a Credit Card Balance Every Month
Written by
Jennifer Taylor
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Sometimes, you need to rely on credit. However, you don’t need to pay higher interest rates than necessary.
You’re certainly not alone in having credit card debt. In fact, as of the third quarter of 2023, Americans have a total of $1.08 trillion in credit card balances, according to the Federal Reserve Bank of New York.
If you carry a credit card balance every month, one of the smartest things you can do is cut back on how much you’re paying in interest. Most people pay 20% interest or more every month on their balance. But there’s a way you could cut that rate to as low as 0.99% APR.
How To Minimize Your Credit Card Interest
One of the simplest ways to do this is to open a balance-transfer credit card. For example, the Navy Federal Credit Union Platinum Card offers low rates and no balance transfer fees.
When you open an account, you’ll get 0.99% APR for the first year, plus you’ll pay no balance-transfer fee.
This can be a huge relief and can help you pay down your balance much faster. Credit card interest can add up fast. It’s not uncommon for a large portion of your monthly payment to go toward interest, instead of paying off your balance.
This can cause a seemingly minimal credit card balance to take years to pay off. A balance-transfer credit card serves as a reprieve by offering lower interest payments.
You might use this opportunity to continue paying the same amount you were with your previous credit card. This could allow you to pay your balance off faster.
Cut Your Interest Rates To As Low As 0.99% APR
An offer that could change your finances for the better, the NFCU Platinum card offers a 0.99% APR on balance transfers for 12 months — plus no balance transfer fees. Afterward, you’ll pay a variable APR of 11.24% to 18%.
These rates are notably lower than those offered by many other issuers. For example, we’ve seen other cards with a variable APR of 18.74% to 29.74% and a 3% standard balance-transfer fee.
The NFCU Platinum card also has no annual fees, no foreign-transaction fees and no cash-advance fees. Fewer fees means you’ll have more cash in your pocket to put toward paying your balance down.
Get Your Finances Under Control
When you carry a credit card balance every month, your interest rate can be the difference between making progress and staying stuck.
Shopping around for a balance-transfer credit card with low rates can notably impact your finances.
For example, if you have a credit card balance of $5,000 and a 30% APY, it will take 22 months to pay your debt off by making $300 monthly payments, and you’ll accumulate a total of $1,362 in interest. On the other hand, you could pay off that same $5,000 balance at a 12% interest rate in 19 months, making $300 monthly payments, with a total of $440 in interest.
Take a look at your latest credit card statement if you don’t know your current APR or how much of your monthly payment is going toward interest. If you don’t like what you see, now is the time to find a balance-transfer card like the NFCU Platinum Card.
It’s easy to apply for the NFCU Platinum Card and see how much you could save in interest.
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