A:

When it comes to picking out a credit card, there are number of factors to consider. From annual fees to perks like cash back and airplane miles, every credit card account is different. Perhaps the biggest factor consumers should focus on is the card's interest rate.
Expressed as an annual percentage rate (APR), this interest rate is the fee paid for the privilege of borrowing money. Essentially, this fee is the price a person pays for the ability to spend money today that would otherwise take time to accumulate. On the flip side, for the banks doing the lending, that fee/interest compensates you for giving up the ability to spend/invest that money today.

This fee varies based on a number of factors, including credit worthiness, amount of debt already outstanding and type of card issued. However, it's the single most important feature choosing a credit card. Pay too much in interest rate fees and that $4 latte could end up costing you around $12 over time.

According to credit bureau Experian, the national average credit score in the U.S. is around 750 out of a maximum score of 990. That's not too shabby of a score. For the average American, finding a low interest rate credit card shouldn't be too hard. Luckily for you, we've done some of the leg work.

First up is the Citi Simplicity card from Citibank. The card offers a 0% intro APR on purchases for 18 months as well as a 0% intro APR on balance transfers for 18 months. After that first year and change, the variable APR is a low 12.99% for qualified consumers. The Citi Simplicity card also features no penalty interest rate increases when you miss a payment due date, and zero late fees.

For those who like to travel, the Capital One issued Venture Rewards card could be for you. This card offers 0% intro APR on purchases till August 2013. After that, consumers will be subject to a low variable APR of 11.99-19.99% depending on your credit worthiness. The kicker for the card is the amount of airline miles a consumer can accrue. The Venture card allows users to redeem miles for airline tickets, hotel rooms, car rentals and other travel needs. Additionally, there is no limit on the amount of miles you can earn and those miles don't feature an expiration date. Currently, the card gives you 10,000 bonus miles once you spend $1,000 in the first three months. Consumers earn 1.25 miles per dollar on every purchase.

For those looking for cash-back rewards, the Discover More card, issued by Discover Financial, is a great choice. The card offers a 0% intro APR on purchases/balance transfers for 15 months and a low variable APR of 10.99% after that. The card provides 5% cash back on quarterly rotating categories. Shopping online through Discover.com will also net you up to 20% in cash-back bonus rewards at popular retailers.

RELATED FAQS
  1. Are credit card rewards considered taxable income by the IRS?

    Learn about when the Internal Revenue Service considers the financial value of gifts received from credit card reward programs ... Read Answer >>
  2. Debt Counseling: 4 Signs You Need Help

    Stop stressing about debt and bills and avoiding phone calls from debt collectors. Get help from a debt and credit counselor ... Read Answer >>
  3. How can you pay your Walmart credit card?

    Learn about the Walmart credit card and how to make payments by a check, online, at Walmart and Sam's Club stores, or over ... Read Answer >>
  4. Is Apple Pay safe and free?

    Learn more about Apple Pay, one of Apple's newest and most metamorphic programs that is changing the way consumers purchase ... Read Answer >>
  5. Can you use your Walmart credit card at Sam's Club?

    Learn how you can use a Walmart credit card at Sam's Club. Sam's Club also takes a variety of other payments and has many ... Read Answer >>
  6. How can you cancel your Walmart credit card?

    Learn how to close your Walmart credit card or Walmart MasterCard, and read details about the process of closing those credit ... Read Answer >>
Related Articles
  1. Chart Advisor

    Trade American Express on Both Sides (AXP, V)

    American Express may offer profits with short term long trades and long-term short sales.
  2. Credit & Loans

    What Lenders Look at on Your Credit Report

    What do lenders consider when they look at your credit report? It’s a simple question with a complicated answer.
  3. Credit & Loans

    Credit vs. Debit Cards: Which Is Better?

    Be strategic about the card you choose
  4. Credit & Loans

    Best Ways to Get Free Credit Scores in 2016

    You've probably seen spammy ads offering the opportunity to check your credit score for "free." Well, not all credit score services are created equal!
  5. Investing News

    Top 5 Companies Owned by American Express (JBLU, FLWS)

    Read about the most important subsidiaries of American Express Company, including two banks, an insurance company and a fraud protection company.
  6. Credit & Loans

    Use Your Credit Card to Improve Your Credit Score

    Responsible credit card use can provide a convenient boost to your credit score.
  7. Credit & Loans

    Reduce Debt Without Spending Unnecessarily

    Here are three steps to reduce debt in a cost-effective manner.
  8. Credit & Loans

    5 ATM Scams That Can Break The Bank

    Don't get scorched by ATM thieves who want to burn a hole in your wallet.
  9. Options & Futures

    Home-Equity Loans: What You Need To Know

    We shed light on why consumers decide to use this form of debt and whether it is a good alternative.
  10. Credit & Loans

    10 Reasons To Use Your Credit Card

    Charging purchases is not always a no-no. In fact, there are some very sound reasons for choosing this option.
RELATED TERMS
  1. Transferable Points Programs (UAL)

    With transferable points programs, customers earn points by using ...
  2. Luhn Algorithm

    An algorithm used to validate a credit card number.
  3. Roll Rate

    The percentage of credit card users who become increasingly delinquent ...
  4. Truncation

    The requirement mandated by the FTC for merchants to shorten ...
  5. Purchase Money Security Interest (PMSI)

    A security interest or claim on property that enables a lender ...
  6. Linked Transfer Account

    Accounts held by an individual at a financial institution that ...

You May Also Like

Trading Center