If you've found yourself paying a high interest on your credit card balance after the holidays, you're not alone. With the average American credit card debt hovering around $6,194, and the total national credit card debt reaching an all-time high of $930 billion, a lot of consumers are wondering just how they are going to pay off their balance.
Many card-holding Americans don't know their credit card's APR, even on the cards they use every day. If this applies to you, and you carry a balance on your credit cards, you would probably be shocked to find out just how much you're paying in interest.
That's where the BankAmericard® credit card comes in. Though it lacks the bells and whistles of many popular rewards credit cards, it delivers value where it matters most: interest. If you want to pay down your high interest debt as quickly as possible, using a card like the BankAmericard could be one of the fastest ways.
Right now, it comes comes with a 0% APR for the first 18 billing cycles on balance transfers made within 60 days of opening your account (then 14.49% to 24.49% variable APR). This is one of the longest 0% interest periods you will find on balance transfer credit cards (though the Citi Simplicity® Card comes in with the longest at 21 months, 14.74% to 24.74% variable APR after).
Doing a balance transfer to get out of debt is a big decision. Below, CNBC Select breaks down the rewards, benefits and fees associated with the BankAmericard to help you decide if it's the right card for you.
This card doesn't offer cash back, miles or points.
No current offer
0% for the first 18 billing cycles on purchases and balance transfers made within 60 days of opening your account
14.49% to 24.49% variable APR on purchases and balance transfers
Either $10 or 3% of the amount of each transaction, whichever is greater.
See our methodology, terms apply.
The BankAmericard is a balance transfer credit card, not a rewards credit card. Therefore, you won't receive points or miles with this card like you would with a travel rewards card like the American Express® Gold Card, which delivers 4X points on restaurants and U.S. supermarkets (on up to $25,000 per year in purchases, then 1X), plus 3X points on eligible flights and 1X points on all other purchases.
Not having a rewards program isn't a bad thing when you're trying to pay down debt. It's important to focus on paying off the debt and not worry about earning rewards.
Though certainly not the flashiest credit card on the market, the BankAmericard could be the perfect card to help you get out of debt, improve your credit score and get approved for cards that require excellent credit. It protects your credit score with a $0 fraud liability guarantee, and the account alerts help you remember when your payments are due. You also get an updated FICO score every month, helping you stay motivated as you pay down your debt.
If you are in the market for a balance transfer card that has additional perks and benefits, the Citi® Double Cash Card is one of our favorite cash-back credit cards that offers a balance transfer promotion. You can take advantage of 18 months of no interest on balance transfers (then 13.99% to 23.99% variable APR), along with up to 2% cash back on eligible purchases (1% when you make a purchase and 1% when you pay off your balance).
The BankAmericard comes with no annual fee. For the first 18 billing cycles, you can also take advantage of 0% financing on both balance transfers and new purchases (then 14.49% to 24.49% variable APR). With no penalty APR, you will not be charged a higher interest rate for a late or returned payment, but there will be a one-time fee of up to $40.
This card does have a balance transfer fee, which is either $10 or 3% of the amount of each transaction, whichever is greater. So if you're transferring a $5,000 balance, you'll pay a $150 fee.
The BankAmericard also charges a 3% foreign transaction fee on all purchases made abroad. If you are planning an overseas vacation you'll need to make sure to add another card to your wallet, like the recently relaunched American Express® Green Card, which rewards travel with 3X points on transit, along with 3X points on restaurants.
Do you have high-interest credit card debt to pay off? Then look no further than the BankAmericard® credit card. Nearly 25% of Americans make purchases they regret later, so if you find yourself with bills to pay, don't beat yourself up. Finding a good balance transfer card makes it possible to kick buyer's remorse to the curb and get back on track.
When your credit improves, CNBC Select recommends signing up for a cash-back card that lets you earn money from your spending habits. One option is the Capital One® Quicksilver® Cash Rewards Credit Card, which earns you 1.5% cash back on every purchase, with no limits and no annual fee.
To determine which credit cards offer the best balance transfer deals, CNBC Select analyzed 101 of the most popular credit cards that offer no interest on balance transfers issued by the biggest banks, financial companies and credit unions that allow anyone to join.
We compared each card on a range of features, including: annual fee, balance transfer fee, rewards program, introductory and standard APR, welcome bonuses and foreign transaction fees, as well as factors such as required credit and customer reviews when available.
For balance transfer cards, we used a Bankrate calculator to tally the interest rates and fees you could incur if you transferred $6,194, the average balance Americans carry on their credit cards in 2019, according to Experian.
If the average consumer with a $6,194 balance on their credit card pays $200 each month, they will spend $2,012 in additional interest, assuming the average 16.97% APR, according to the Fed. And it will take them 42 months — more than three years — to pay off that debt.
With four of the five cards featured on this list, if you take full advantage of the intro APR period and pay $200 per month, you'll pay less than $500 in interest. That's a significant savings.
For the cards that offered a rewards program, we also estimated how much cash back you might earn over a five year period. CNBC Select teamed up with location intelligence firm Esri. The company's data development team provided the most up-to-date and comprehensive consumer spending data based on the 2019 Consumer Expenditure Surveys from the Bureau of Labor Statistics. You can read more about their methodology here.
Esri's data team created a sample annual budget of approximately $22,126 in retail spending. The budget includes six main categories: groceries ($5,174), gas ($2,218), dining out ($3,675), travel ($2,244), utilities ($4,862) and general purchases ($3,953). General purchases include items such as housekeeping supplies, clothing, personal care products, prescription drugs and vitamins, and other vehicle expenses.
CNBC Select used this budget to estimate how much the average consumer would save over the course of a year, two years and five years, assuming they would attempt to maximize their rewards potential by earning all welcome bonuses offered and using the card for all applicable purchases. All rewards total estimations are net the annual fee.
It's important to note the value of a point or mile varies from card to card and based on how you redeem them. When we calculated the estimated returns, we assumed that cardholders are redeeming points/miles for a typical maximum value of 1 cent per point or mile. (Extreme optimizers might be able to achieve more value.)
When choosing the best balance transfer card, we focused on the card that provides consumers with the cheapest way to pay off their debt rather than the number of rewards they could potentially earn. When you're in credit card debt, your primary focus should be repayment. Earning rewards should be seen as a bonus, and you don't want to spend beyond your means in order to earn points.
The five-year rewards total and the interest rate and fees estimates are derived from a budget similar to the average American's spending and debt. You may earn a higher or lower return depending on your spending habits.
Information about the BankAmericard® credit card and Capital One® Quicksilver® Cash Rewards Credit Card has been collected independently by CNBC and has not been reviewed or provided by the issuer of the card prior to publication.