What Is a Good APR for a Credit Card?

Credit card Q&A: “What is a good APR for a credit card?”

Everyone always want the best, the lowest, the cheapest, etc., etc. It makes perfect sense. Why settle for less?

But what people don’t seem to realize when they ask where to find the best of “x” is that it varies from person to person, from situation to situation.

The best credit card for one consumer may be the worst for another, and so it’s tough to come up with one indisputable answer, especially in the credit realm.

Credit Card APR is Generally Very High

What I can say definitively is that credit card APR is generally very high compared to other interest rates.

For example, long-term fixed mortgage rates are averaging around 4% at the moment, a historical low to be sure. But this compares to an average rate in the teens for credit card interest rates.

And just last week, interest rates on new credit card offers were at record highs, per the Weekly Credit Card Rates Report from CreditCards.com.

Yep, the national average credit card APR was 14.94% – that’s more than three times the average rate on a mortgage.

In short, you pay a lot for the privilege of carrying a credit card balance.

For a so-called “low interest” credit card, the average APR was 10.73%, still sky-high in the grand scheme of things.

Even balance transfer credit cards had an average APR of 12.73%, which surely doesn’t make a lot of sense when there are plenty of promotional 0% APR balance transfer credit cards out there.

If you happen to have bad credit, the average APR is a staggering 24.96%, all the more reason to pay closer attention to your credit score!

Take a look at the full range of credit card APR to get a better idea as to what to expect and to determine where your card stands.

Regardless of these numbers, my general recommendation has always been to avoid carrying a credit card balance, largely because of these very interest rates.

They’re absurdly high, and should be avoided at all, ahem, costs.

How Can You Avoid It?

The simplest way to avoid paying interest on your credit card debt is to pay it off in full each month.

After all, if you don’t carry a balance, you won’t pay interest, so it really doesn’t matter if the interest rate is 0% or 30%.

Pretty basic, right? Well, not all of us have the money to pay off our balance in full, especially after spending beyond our means.

Fortunately, there is another pretty straightforward method: a credit card balance transfer.

If you’ve gotten yourself into debt, a 0% APR balance transfer will allow you to move your high-APR debt (see table above) to a 0% APR for as long as 21 months (2011 Citi balance transfer credit cards).

(Also see longest 0% APR credit card offers.)

During that time, you can pay off the debt without having to worry about finance charges increasing your balance and pushing you further down the debt spiral.

Let’s face it. Carrying a credit card balance is a losing endeavor, unless you’re paying 0% APR. Any other rate will probably be in the teens or higher, which is certainly far from ideal.

Read more: What credit card has the lowest interest rate?