How to Get Ahead With a 0% APR Credit Card

By Holly Johnson. Last updated 27 February 2020. 0 comments

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Credit cards have made it extremely convenient to get what we need — from online shopping to everyday purchases, not having to hit the ATM and use cash saves time, space, and energy. But having easy access to credit also means it’s easy to overspend — something you just couldn’t do when paying with cash. You can end up with a mountain of debt that can take years or even decades to pay off. 

One kind of credit card may be more likely to set you up for success, and this type of card can even help you save money on interest if you're struggling with debt already. Balance transfer credit cards, which can also be called 0% APR credit cards, actually let you avoid paying interest altogether for a limited time. 

Two main strategies can help you get ahead with this type of credit card, but only if you use plastic with a plan and stay disciplined in your approach. 

Earn rewards on a big purchase

If you want to make a big purchase and pay it off slowly without having to pay interest, you should check out 0% APR credit cards that let you skip interest payments and earn rewards for each dollar you spend. This type of card typically works well if you need to pay for new appliances for your kitchen, a major home upgrade or repair, or even a semester of college. By charging the large purchase to your 0% APR credit card, you may be able to earn an initial sign-up or welcome bonus as well as rewards as a percentage of your spending. 

Of course, there are plenty of rewards credit cards that also dole out big initial bonuses and ongoing rewards while letting you avoid paying interest for up to 21 months. Make sure to compare rewards and cash back credit cards to see which ones might work best for whatever it is you need to buy and pay down slowly over time. 

Consolidate high-interest debt

If you have a lot of debt at high interest rates, you can also get ahead with a 0% APR credit card — provided you stop spending and start focusing on debt repayment instead. Balance transfer credit cards often let you secure 0% APR on balance transfers for up to 21 months, although some do charge a 3% or 5% balance transfer fee for the privilege. Even if you do pay a balance transfer fee, however, the interest savings can far outweigh the fee.

If you're against paying a fee to transfer high interest balances over, you can look for cards that waive this fee for a limited time. 

How to choose a 0% APR credit card

Whether you want to pay down a large purchase without interest or save money by consolidating high interest debt at 0% APR, it's crucial to make sure you wind up with a new credit card that offers the perks you want. Here's everything you need to look for as you decide.

0% APR offers that give you the time you need

If you want to pay off a large purchase over time or consolidate debt at 0% APR, you'll need to make sure you have enough time to pay off your debt entirely. Definitely compare 0% APR offers to see which ones give you plenty of time to accomplish your goal. If you don't, you'll wind up paying off debt at the standard variable APR, which will likely be very high. 

Don't pick a card that might entice you to overspend

If you're really trying to pay off debt, stay away from cards that offer big sign-up bonuses within the first few months. You should use your balance transfer credit card to save money on interest, but don't use it for everyday spending. 

Make sure to take fees into account

Most 0% APR credit cards don't charge an annual fee, but you should still compare balance transfer fees and other potential fees you may be charged such as late fees and over-limit fees.

Compare rewards programs

Finally, make sure you check out rewards programs if you want to rack up points on a large purchase. Some cards only let you redeem rewards for gift cards or cash back, whereas others let you cash in points for travel or transfers to airline and hotel partners. Compare rewards programs ahead of time so you earn the type of rewards you want the most.

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