Advertising Disclosure *Advertising Disclosure: SmartBalanceTransfers.com is an independent, advertising-supported comparison service. SmartBalanceTransfers.com receives compensation from the credit card issuers whose credit card offers appear on the website. The compensation may impact the order in which they appear within listing categories. SmartBalanceTransfers.com does not include the entire universe of available credit or financial offers.

About Editor's Picks: Our editor selects credit cards based on the features the credit card offers consumers, including introductory rates, fees, long term interest rates, and its relative value compared to competing offers. While this site receives remuneration from credit card companies, our rankings strive to objectively provide consumers with relevant, unique options.

How Much Have You Spent on Interest in 2013?

dec-best-0aprFor those with credit card debt, every statement can be a painful blow. Each month, cardholders see a new balance with another large interest payment. But what is worse, is the total amount of interest being paid throughout the year. And while it won’t be fun to learn the answer, it is important to know what the amount is, and what you can do about it.

For every $1,000 of debt, cardholders will pay $10 a month in interest at 12% APR,  $15 a month at 18% APR, and $18.33 at 22% APR. So if a cardholder has had an average of  $1,000 of credit card debt from January to April, that equates to $40 at 12% APR, $60 at 18% APR, and $73.33 at 22% APR.

And of course this is for each $1,000 of debt. Multiply those amounts for every thousand dollars of credit card debt you have, and the number grows quickly. Furthermore, interest will continue to accrue each month on the debt. And since the interest charges are added to the balance, these figures will underestimate the actual interest paid by most cardholders.

What can you do about it?

The quickest way to avoid interest charges is to immediately pay off all credit card debt. But since those with debt are almost by definition unable to pay it off, they need to turn to another source. Fortunately, there are many credit cards on the market that will pay off your existing balances as part of a 0% APR promotional balance transfer.

How balance transfers work

First, cardholders select the best offer on the market and apply for a new card. Once received, the cardholder contacts the bank and requests that a balance transfer be performed. The new account then pays the old balance, up to the card holder’s available credit limit. In most, but not all cases, a 3% balance transfer fee will be added to the cardholder’s  account. Yet even when this fee is incurred, it is only equal to two month’s interest at 18% APR, yet the best offers feature 15-18 months of interest free financing.

Choosing the best card

Currently, the Slate® from Chase card is the only product available with 0% APR balance transfers and no balance transfer fee. It offers 15 months of interest free financing on both new purchases and balance transfers with no annual fee. The other two top cards are the Citi Simplicity and Citi Diamond Preferred. Each offers 18 months of interest free financing on both new purchases and balance transfers. There is no annual fee for these cards, but there is a 3% balance transfer fee.

  • Best 0% Offer in 'Crowning 2013's Best Credit Card Offers' (January 14, 2013) -Forbes Online
  • Pay less interest. Save on balances and new purchases
  • $0 introductory balance transfer fee for transfers made during the first 60 days. After that, the fee for future balance transfers is 3% of the amount transferred with a minimum of $5.
  • 0% Introductory APR for 15 months on purchases and balance transfers. After the introductory period ends, a variable APR of 12.99%, 17.99%, or 22.99%.
  • $0 Annual Fee
Purchases Intro
Balance Transfers Intro
Regular APR
Annual Fee
Credit Needed

0% for 15 months*

0% for 15 months*

12.99%, 17.99%, or 22.99% (V)*

$0

Excellent/Good


It is important to understand how much interest charges cost, and how to pay your debt off without incurring it.

Editor's Note: This content is not provided by Citi. Any opinions, analyses, reviews or recommendations expressed here are those of the author's alone, and have not been reviewed, approved or otherwise endorsed by the Citi or any of the other companies whose products are featured in this content.

About the author

Jason Steele

Jason Steele is a freelance journalist specializing in personal finance and travel and is recognized as an expert in credit cards. He is a regular contributor to many of the top personal finance sites such as Wise Bread and Money Talks News. His work has been frequently carried on mainstream news outlets such as MSN Money, Yahoo, Finance, and Business insider.

Jason lives in Denver Colorado with his wife and two daughters.

– has written 312 posts.

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