Debt is an almost unavoidable part of life, and with high-interest rates and late fees, getting out of it can feel like an uphill battle.
To make it even harder, most credit cards charge transfer fees, even those with 0% balance transfer offers. The average transfer fee is about 3% of the amount transferred, which can add up quickly. Luckily, no balance-transfer fee credit cards can help you get out of debt. Though fairly rare, you can use these cards to move a balance from a credit card with a high-interest rate to one that temporarily charges no interest, providing you with a window of time to focus on getting out of the red.
Remember, finding the right card for a balance transfer isn't just about picking a $0 balance transfer fee credit card with the lowest APR. Usually, as fees go down, rates tend to go up, and vice versa. When picking a card, it's important to consider these factors:
- Balance transfer fee
- Length of 0% intro APR
- Regular APR
- What you can pay each month
To help you decide, we compiled a list of the five best balance-transfer credit cards to help you get back in the black.
The American Express EveryDay is a good choice for a card with a $0 balance transfer fee. If you can pay off your balance within the no-interest introductory period of 15 months, you only have to pay the cost of your balance. But, the variable APR after that introductory period is 14.74 to 25.74 percent, so we recommend this card for people with more minor debt. As for rewards, the card offers 2 points for every dollar spent on groceries up to $6,000.
The American Express EveryDay Card
American Express
The American Express EveryDay is a good choice for a card with a $0 balance transfer fee. If you can pay off your balance within the no-interest introductory period of 15 months, you only have to pay the cost of your balance. But, the variable APR after that introductory period is 14.74 to 25.74 percent, so we recommend this card for people with more minor debt. As for rewards, the card offers 2 points for every dollar spent on groceries up to $6,000.
Chase Slate
WalletHub
Chase Slate® is another good choice for people looking to quickly pay off minor debt. This card boasts a $0 balance transfer fee for 60 days, gives you 0% APR on purchases and balance transfers for 15 months, and doesn't charge an annual fee. But, if you expect to be in debt after those 15 months, you might want to choose a card with a longer grace period.
Amex EveryDay Credit Card from American Express
American Express
Another card worth looking into when considering how to pay off your debt is the Amex EveryDay® Credit Card from American Express. With this card, you get a $0 transfer fee for the first 60 days, 0% APR for the first 12 months, and a regular APR of 14.99% - 25.99%. But what makes this card a competitive choice is the exceptional rewards program it includes, 10,000 Membership Rewards points after you use your new Card to make $1,000 in purchases in your first 3 months, 2x points on groceries on up to $6,000 per year in purchases.
Citi Diamond Preferred Card
Credit Karma
If you're looking for a longer grace period, the Citi Diamond Preferred Card offers a 21 month no-interest introductory period on balance transfers. There's a 0 percent APR on balance transfers during that period, as long as the transfers are completed within the first four months, and there's no interest on purchases for a year. Unfortunately, the card doesn't offer any rewards and requires a 5% balance transfer fee.
U.S. Bank Visa Platinum
US Bank Credit Wellness
The U.S. Bank Visa Platinum has a 20-month introductory period, making it the longest introduction APR on both purchases and transfers of any card from a major issuer. While the Citi Diamond Preferred card offers a longer APR on transfers, the Platinum offers a lower variable APR range, 11.74 percent to 23.74 percent. Unfortunately, it requires a 3% balance transfer fee, but given the length of the introductory period, we think it's worth the cost.
- Best Balance Transfer and 0% APR Credit Cards of 2018 - NerdWallet ›
- The best credit card to pay off debt with no balance transfer fee ›
- Best No Balance Transfer Fee Credit Cards - NerdWallet ›
- 2018's Best Credit Cards with No Balance Transfer Fee ›
- Best Balance Transfer Credit Cards: October 2018 - CreditCards.com ›
- The Best 0% APR Credit Cards with No Fees for October 2018 ›
The Federal Reserve sets the guardrails for the federal funds rate, and through that helps control the money supply for the nation.
When you take out a loan for a car, charge something to your credit card, or get a personal line of credit, there is going to be an interest rate that applies to your loan.
A lot of different factors go into what you will be charged, including your own personal credit score. But even those with flawless credit still see a minimum charge that they can't get around. That all goes back to the Federal Funds Rate.
One thing consumers rarely realize is that all of our banks are lending money to each other every night. Banks are legally required to maintain a certain percentage of their deposits in non-interest-bearing accounts at the Federal Reserve to ensure they have enough money to cover any withdrawals that may unexpectedly come up. However, deposits can fluctuate and it's very common for some banks to exceed the requirement on certain days while some fall short. In cases like this, banks actually lend each other money to ensure they meet the minimum balance. It's a bit hard to imagine these multibillion-dollar financial institutions needing to borrow money to tide them over for a bit, but it happens every single night at the Federal Reserve. It's also a nice deal for those with balances above the reserve balance requirement to earn a bit of money with cash that would normally just be sitting there.
The Federal Reserve
The exact interest rate the banks will charge each other is a matter of negotiation between them, but the Federal Open Market Committee (FOMC) (the arm of the Federal Reserve that sets monetary policy) meets eight times a year to set a target rate. They evaluate a multitude of economic indicators including unemployment, inflation, and consumer confidence to decide the best rate to keep the country in business. The weighted average of all interest rates across these interbank loans is the effective federal funds rate.
This rate has a huge impact on the economy overall as well as your personal finances. The federal funds rate is essentially the cheapest money available to a bank and that feeds into all of the other loans they make. Banks will add a slight upcharge to the rate set by the Fed to determine what is the lowest interest that they will announce for their most creditworthy customers, also known as the prime rate. If you have a variable interest rate loan (very common with credit cards and some student loans), it's likely that the interest rate you pay is a set percentage on top of that prime rate that your lender is paying. That's why in times of low interest rates (it was set at 0% during the Great Recession), a lot of borrowers should go for fixed interest rate loans that won't increase. However, if the federal funds rate was relatively high (it went up to 20% in the early 1980's), a variable interest rate loan may be a better decision as you would be charged less interest should the rate drop without the need to refinance.
The federal funds rate also has a major impact on your investment portfolio. The stock market reacts very strongly to any changes in interest rates from the Federal Reserve, as a lower rate makes it cheaper for companies to borrow and reinvest while a higher rate may restrict capital and slow short-term growth. If you have a significant portion of your investments in equities, a small change in the federal funds rate can have a large impact on your net worth.
Whether you're leaving a job involuntarily, departing for something new, or just want to prepare for the unknown, it is smart to understand all your options regarding your 401k.
diy gifts
Frugal gifting often gets a bad reputation. However, this shopping method does not make you cheap — it makes you practical. Frugal gifts often avoid waste and overspending and can be just as meaningful (if not more so) as any other present.
With the National Retail Federation predicting each consumer this holiday season to spend upwards of $1,000 on holiday gifts amidst an economic recession —this year might be the perfect time to reconsider your spending budget. We've formulated the ultimate list of frugal gift-giving ideas to get you started.