If you have credit card balances on several credit cards with high interest rates, you might be considering consolidating your debt to a balance transfer credit card with a lower interest rate to help eliminate your debt quicker. How would you like to get rewarded as well?
How a Balance Transfer Card Works
Many balance transfer cards offer a 0% APR introductory offer on transferred balances, enabling you to carry your balance interest-free for the length of the introductory terms. During the promotional offer, you won’t pay interest charges on your balance, enabling you to save money while reducing your debt.
By law, balance transfer offers with promotional financing must be valid for at least six months, and the top offers currently available can extend for as long as 21 months. The majority of balance transfer offers include a balance transfer fee of 3% of the amount transferred added to the new balance. Some have a fee of up to 5%, and there are even a few offers with no balance transfer fee.
How a Rewards Credit Card Works
Many consumers find rewards credit cards very beneficial. They can earn rewards on everyday purchases. All those trips to the grocery store can send you on a European vacation or help you get cash back. Rewards cards generally fall into three earning categories - airline miles, cash back and points.
• Travel – earn a specific number of miles for each dollar spent on your card. Miles are often redeemable for airline fare, hotel stays, and a variety of other travel expenses.
• Cash Back – can include a flat-rate cash back percentage, or bonus cash back for purchases in specified categories such as gas station or restaurant purchases. Some issuers also offer signup bonuses, which can earn you hundreds in bonus cash back
• Rewards Points – most flexible redemption options: points can be redeemed for cash back and gift cards, or for travel-related expenses or for something else entirely. Most points programs provide a flat-rate point-per-dollar earnings system, though some will award bonus points for specified categories. Per-point value of your rewards will vary by issuer how you redeem your reward.
Rewards and Balance Transfer Credit Cards
While you won’t earn rewards on your transferred balance, you can earn rewards on qualified purchases. Most balance transfer promotional offers also include no interest on purchases, often for the same period as the balance transfer APR.
For many people with credit card debt, earning rewards while paying down their balance is not the best strategy. However, if you have a solid plan for paying down your debt during the promotional period, a balance transfer card with rewards can help you transfer a balance, avoid interest and earn rewards.
5 Best Balance Transfer Rewards Credit Cards
Chase Freedom Unlimited®
• Unlimited 1.5% cash back on every purchase
• Earn a $150 Bonus after you spend $500 on purchases in your first 3 months from account opening
• 0% Intro APR for 15 months from account opening on purchases and balance transfers, then a variable APR of 16.99-25.74%. Balance transfer fee is 5% of the amount transferred, $5 minimum.
• No Annual Fee
Blue Cash Everyday® Card from American Express
• $150 statement credit after you spend $1,000 in purchases on your new Card within the first 3 months.
• 3% cash back at U.S. supermarkets (on up to $6,000 per year in purchases, then 1%).
• 2% cash back at U.S. gas stations and at select U.S. department stores, 1% back on other purchases.
• 0% intro APR for 15 months on purchases and balance transfers, then a variable rate, currently 14.99% to 25.99%.
• Cash back is received in the form of Reward Dollars, which can be redeemed for statement credits, gift cards, and merchandise.
• No annual fee.
Barclaycard Arrival Plus World Elite Mastercard
• 0% introductory APR for 12 months for each balance transfer made within 45 days of account opening (after that, it’s a variable rate of 17.99%, 21.99% or 24.99%).
• New applicants 60,000 bonus miles after spending $5,000 within 90 days of account opening, and earns double miles on all purchases.
• Barclaycard miles are worth 1 cent apiece as statement credits toward travel-related expenses, and holders of both cards receive a 5% rebate on their miles redeemed.
• Miles don’t expire
• $89 annual fee (waived the first year)
• No foreign transaction fees.
Discover It Cash Back
• 0% intro APR for 18 months on balance transfers then 13.99% to 24.99% Standard Variable Purchase APR applies. 3% fee for each balance transfer.
• 0% intro APR f for 12 months then 13.99% to 24.99%, based on your creditworthiness.
• Discover matches cash back you've earned at the end of your first year, with no limit.
• Earn 5% cash back at different places each quarter like gas stations, grocery stores, restaurants, Amazon.com, or wholesale clubs up to the quarterly maximum each time you activate. Plus, earn unlimited 1% cash back on all other purchases - automatically.
• Redeem cash back any amount, any time. Rewards never expire.
• Use your rewards at Amazon.com checkout.
• No annual fee.
Capital One® Quicksilver® Card - 0% Intro APR for 15 Months
• One-time $150 cash bonus after you spend $500 on purchases within 3 months from account opening
• Earn unlimited 1.5% cash back on every purchase, every day
• No rotating categories or signups needed to earn cash rewards
• Cash back won't expire for the life of the account and no limit to how much you can earn
• 0% intro APR on purchases for 15 months; 14.74%-24.74% variable APR after
• 0% intro APR on balance transfers for 15 months; 14.74%-24.74% variable APR after; 3% fee on the amounts transferred within the first 15 months.
• No annual fee or foreign transaction fees.