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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.
Yahoo
27-02-2025
- Business
- Yahoo
Best credit card sign-up bonuses for 2025
A credit card sign-up bonus can help you quickly earn valuable rewards as a qualified new cardholder, whether you prefer cash back, points, or miles. Your bonus could be worth up to $750 or more, depending on the offer. These limited-time credit card offers provide better deals than the standard offers, but they're only here for a limited time, so act quickly if one meets your needs. Why we like it: The Amex Blue Cash Preferred has one of the most rewarding cash-back rates available for common expenses, making it easy to earn cash-back rewards on purchases you already make. If you want an everyday rewards earner, this could be your we like it: The Capital One Quicksilver makes sense if you want a straightforward, no-frills cash-back card. With no annual fee, foreign transaction fees, or bonus categories to worry about, this can be the only card you need in your we like it: The Chase Freedom Unlimited is a heavy-hitter rewards earner and 0% intro APR card, all with no annual cost. Even better, you have flexibility with your redemption options, with complete control over redeeming your rewards for cash back, travel, gift cards, and we like it: The Capital One Savor has an excellent 0% intro APR offer for new cardmembers, and it also checks multiple other boxes to ensure it provides lasting value. It has no foreign transaction fees, no annual fee, and one of the best rewards rates available for earning unlimited cash back on everyday we like it: The Chase Sapphire Preferred is one of the best cards for travelers because it earns valuable Chase Ultimate Rewards points and has a low annual fee. You also have flexibility with your redemption options, including redeeming points for airfare, hotel stays, rental cars, transfer partners, and we like it: If you want a straightforward card for earning travel rewards on all your eligible purchases, look no further than the Capital One Venture Rewards. This card doesn't have confusing spend categories, making it the perfect addition to your wallet if you want one card for we like it: The Discover it Student Cash Back is a dual threat, allowing you to earn valuable rewards while building a positive credit history. If you compare this card with the non-student version, you'll find you don't lose out on its high rewards rate or generous welcome we like it: The IHG One Rewards Premier is one of our favorite hotel cards because you get a free anniversary night each year and automatic elite status. The free night benefit alone can offset the annual fee, so any other value you get from rewards and benefits is just icing on the cake. Why we like it: The Delta SkyMiles Reserve Amex makes sense if you frequently fly Delta and want premium travel benefits, such as access to Delta Sky Clubs and up to $240 annual Resy credit (up to $20 back per month on eligible Resy purchases). It's also an excellent way to boost your Medallion Status yearly, as it boosts Medallion Qualification Dollars (MQD) we like it: The Amex Gold Card is excellent for earning points in the Membership Rewards program on everyday shopping and dining trips. It's also one of our favorite cards for foodies because of its multiple dining-related perks where you can receive statement credits to more than cover the annual membership we like it: The Capital One Venture X is our pick for a premium travel credit card with a reasonable annual fee. You still get the airport lounge access benefits and an annual $300 travel credit for bookings through Capital One Travel, but you don't have to pay as much as you would with certain competitor cards.A credit card sign-up bonus is a reward you can earn as a new cardholder on a rewards credit card. You usually must meet a spending requirement to earn a welcome bonus, often rewarded as cash back, points, or miles. For example, earn 60,000 bonus points after spending $4,000 in the first three months after account opening. The requirements can vary by the welcome offer, credit card issuer, and credit card, but you typically have to spend a certain amount of money on your card within a specific period to earn a bonus. It's common for welcome offer spending requirements to give you a three-month period to earn the bonus, but some periods can last for six months or more. The amount of money you must spend for the bonus can vary, but often ranges from $500 to $4,000. Many business credit card card welcome offers have higher spending requirements, sometimes reaching $15,000 or more in the same amount of time. You won't earn the welcome bonus if you don't meet the spending requirements within the given timeframe. One thing to be aware of is that having any of your expenses credited back because of canceled or returned purchases could affect whether you qualify for a bonus. The most common types of credit card sign-up bonuses include rewards in the form of: Cash back Points Miles Cash-back credit cards reward cash back, while travel credit cards reward you with points or miles. Credit card sign-up bonus requirements can include: Approval: You must apply and be approved for a card to qualify for its welcome offer. This could include having a sufficient credit score to be eligible for approval. Previous bonus requirements: You might not qualify for a bonus offer if you've earned a similar offer recently, such as within the last 24 or 48 months. Similar card requirements: You might not qualify for a bonus offer if you have or have had the same or a similar credit card. Spending requirements: To earn a welcome bonus, you must spend a certain amount on your card within a specific timeframe. Consider these factors when reviewing credit card sign-up bonuses: Type of reward: Cash back, points, and miles are the most common reward types. If you're interested in travel, consider points or miles. Otherwise, cash back is the recommended option. Rewards value: Not all rewards currencies are the same, so it's worth researching the estimated value of a currency when researching different welcome offers. For example, 100,000 points on one card could equal $1,000, but the same number of points on another card might be worth $1,500 toward travel on another card. Your monthly budget: Going beyond your usual spending habits to earn a welcome offer doesn't make sense in most situations. For this reason, you should calculate your everyday expenses, such as buying groceries and filling up at gas stations, to see if your typical budget can help you meet the spending requirements for a bonus. It's worth looking into the best sign-up bonuses if you have large upcoming purchases. This strategy lets you earn valuable rewards without overspending. However, it's also worth considering a card's other perks and benefits to see if they can bring you long-term value. You typically aren't taxed for earning a credit card welcome bonus. You might incur taxes if you earned a bonus without spending money or earned rewards in other ways, such as referral bonuses, without spending anything. These credit cards provide bonus rewards to qualifying new cardmembers: Blue Cash Preferred® Card from American Express Capital One Quicksilver Rewards Credit Card Chase Freedom Unlimited® Capital One Savor Cash Rewards Credit Card Chase Sapphire Preferred® Card Multiple credit cards provide welcome bonuses that could be worth at least $750, including: Chase Sapphire Preferred® Card Chase Sapphire Reserve® Capital One Venture Rewards Credit Card Capital One Venture X Rewards Credit Card Citi Strata Premier® Card We researched nearly all available rewards credit cards with sign-up bonuses from major card issuers to find the best sign-up bonuses. We did not research every available credit card from every credit card company or include business cards in our research. We added over 100 credit cards to a rubric to compare current welcome offers, including their bonus values and spending requirements. We also included card types for each card, such as 'cash back,' 'travel,' and more. We determined which cards had the best sign-up bonuses according to the amount of value you could receive from them, as well as the best sign-up bonuses according to card type. Our final list is based on our rubric, research, and expert opinion. 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.
