Have you ever planned to be in credit card debt? We’re assuming the answer is probably no. But the fact is, credit card debt has become a Canadian epidemic – with more than half of us carrying a balance on our credit cards each month.
The problem with carrying a balance on your credit card is the interest rate, which can range anywhere from 19.99% to 29.99%, depending on the type of card. Your interest rate may increase if you’re late on payments and don’t forget that interest compounds – meaning, you could be charged interest on your interest.
This is why we recommend using credit cards as a payment tool but not as a way to borrow money. If you do carry some credit card debt, taking out a personal loan with a lower interest rate may be another option to help you save money.
At Borrowell, we’re all about helping Canadians make great decisions about credit. If you use credit responsibly but you’re worried about that one missed payment, transferring your balance to a low interest card may be a better decision. We’ve rounded up the best low-interest credit cards available – here are our top three.
- No annual fee
- 8.99% interest rate on purchases
- 1.99% introductory interest on balance transfers for the first 6 months
The American Express Essential Card makes our list because firstly, there is no annual fee. When you’ve got bills to pay, this can make all the difference. The American Express Essential Card is also attractive for those looking to transfer an existing balance because it offers a 1.99% introductory interest rate on balance transfers for the first six months. You’ll also receive an 8.99% interest rate on all cash advances, and purchases after the introductory period.
What’s a credit card without perks? You’ll also receive exclusive American Express Invites, including the Front of the Line program. This opens the doors to great music, theatre, dining, film, fashion and shopping experiences.
- $20 annual fee
- 11.99% interest rate on purchases, cash advances, and balance transfers
- Free extended warranty and purchase protection
The BMO Preferred Rate Mastercard is one of the best low interest credit cards on the market. It has a low annual fee of $20 and offers some great advantages to customers.
The BMO Preferred Rate Mastercard features an 11.99% interest on purchases, cash advances, and balance transfers. This single interest rate (that you’ll have as long as you make your payments on time) is beneficial because you won’t have any surprises down the road.
As for perks, the BMO Preferred Rate Mastercard offers free extended warranty and purchase protection. It also offers zero dollar liability, which means that any fraudulent charges that you report or that the card issuer detects will be removed from your account. If you’re looking for a simple and easy to use credit card, this one is a good choice.
- No annual fee
- Low interest rate of 9.99% on purchases and balance transfers
- Around-the-clock fraud protection
The CWB Platinum Plus Mastercard is also a great option for a low interest credit card.
The CWB Platinum Plus Mastercard has no annual fee and offers a low-interest rate of 9.99% on purchases and balance transfers. So if you’re carrying a balance on a high interest credit card, it’s definitely worth switching over to a lower interest card, or considering a personal loan.
Cash advances are a little steep, at 24.99%. But the benefits include immediate cash access at over 1 million ATMs worldwide and around-the-clock fraud protection.
Stay tuned for our “Best Of” lists for cashback cards, rewards card, and travel cards – coming soon!
Don’t know your credit score? Find out here and check out My Recommendations to see all the financial products available to you.