What is the average interest rate on a credit card? – Forbes Consultant

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The Federal Reserve tracks the average interest rate paid by consumers in the US for a variety of different financial products, including credit cards. In 2021, the average interest rate on credit cards in the United States on interest-bearing balance accounts was 16.45%.

Of course, the annual rates (APR) you pay with your own credit cards may not be in line with the national average. Credit card APRs can vary widely based on a number of factors, from your credit score to your debt-to-income ratio and more.

Find the best credit cards for 2022

No credit card is the best choice for every family, every purchase or every budget. We have selected the best credit cards in a way that is designed to be the most useful for the widest variety of readers.

Average credit card interest rate per credit score

Higher credit scores have the potential to help you qualify for lower interest rates on credit cards, loans and other types of financing. As a result, a good credit score can save you money.

Bad credit scores, on the other hand, indicate a higher risk for the credit card company. This situation tends to translate into higher APRs for you as a cardholder. It is not uncommon to come across credit cards with APR as high as 25% to 30%.

Exact credit card rates may vary from company to company, as well as between individual cardholders. The type of credit card you open can also play a role in your APR, with rewards credit cards often having higher interest rates than other types of credit card products.

Here’s a look at the approximate APR range you can find on a general purpose credit card according to your credit score. You should always contact your individual credit card issuer to confirm what charges are offered on any account you are considering.

How Your Credit Card Rate Can Affect You

When it comes to interest rates, it is always best to ensure the lowest possible number. On paper, the difference between a 15% APR and a 20% APR may not seem so great. But if you keep a balance in your credit card account, a lower interest rate can save you thousands of dollars. Below is an example.

As you can see above, the interest rate on your credit card can also affect the time it will take you to pay off your credit card debt. A lower APR can make debt write-off faster and easier.

Of course, the best way to handle credit cards is to pay off your balance every month. If you can develop this habit and avoid credit card debt from the beginning, then the APR in your account should have no effect on your budget. In fact, when you pay off your full account balance on a monthly basis, you can avoid paying your credit card interest altogether.

How To Reduce Your Credit Card Rate

If you are working on paying off your credit card debt, securing a lower interest rate could help you save money and get rid of the debt faster. Here are some strategies you can use to try to reduce your April credit card.

  • Balance transfer: You may be able to open a new credit card to take advantage of a low interest rate or 0% APR balance transfer offer. Low interest rates on balance transfer credit cards do not last forever (usually 12 to 18 months). But if you can afford to attack your debt while the introductory APR is in effect, you may be able to get a big bite out of your credit card debt or you may be able to pay it off in full.
    A balance transfer calculator can help you keep track of balance transfer commissions, introductory prices, and more to add to your potential savings. It is also wise to compare multiple transfer credit card offers to make sure you find the best deal that best suits your situation. Keep in mind that you usually need credit from good to excellent to qualify.
  • Consolidation loan: Another way you can find a lower interest rate on your existing credit card debt is to pay it off with a debt consolidation loan. Depending on your creditworthiness, debt-to-income ratio (DTI) and other factors, you may be able to take out a new personal loan at a lower interest rate than you would pay on your credit card bills.
    A low interest rate debt consolidation loan could save you money and speed up the debt write-off process. In addition, by consolidating your credit card debt with a down payment loan, you could reduce your credit card usage rate and possibly improve your credit score at the same time.
  • Ask your credit card issuer: Your APR credit card is not carved in stone. You can ask your credit card issuer if they are willing to lower your credit card interest rate and in some cases you may be successful.
    Let the card issuer know if you have seen credit card offers with lower interest rates you are considering. Having a timely payment history in your account and a good credit score could also work in your favor when you make your request.

Quick Tips on How to Improve Your Credit

Whether you are trying to secure a low interest rate on a new credit card account or want to lower your APR on an existing account, having a good credit score can give you an edge. Good credit improves your chances of qualifying for new accounts and getting the best interest rates and terms credit card companies have to offer.

In fact, it may take some time to move from bad credit or even fair credit to a good credit score. However, there are steps you can take that can help you see some improvement in your credit score sooner rather than later.

  • Check your credit reports. Knowing where you are is a crucial step when trying to improve your credit. The good news is that checking your three credit reports from major credit bureaus (Equifax, TransUnion and Experian) is easy and free. Visit AnnualCreditReport.com claim a free credit report from each office once every 12 months. During a pandemic, you can enjoy free weekly access to your credit reports through the same website.
  • Make a note of the devaluing credit information. Once you have your references in your hands, read them from top to bottom. Make a note of any negative information that you find that may be hurting your credit score. You may not be able to do anything about these issues until your credit report is out of date. But you can make a point to avoid repeating the same mistakes.
  • Credit error dispute. As you look at your credit reports, you should also list the credit reporting errors or signs of fraud that you discover. The Fair Credit Reporting Act (FCRA) allows you to challenge any inaccurate information that appears on your credit report with the appropriate credit bureau.
  • Pay off your credit card balances. Reducing your credit card balance and consequent credit usage rate can be one of the most rewarding ways to improve your credit score. Utilizing credit is an important factor in credit score — which is largely responsible for 30% of your FICO score. Having a low credit score indicates that you have a lower credit risk.
  • Display a positive payment history. How you pay your credit bills — on time or in arrears — is the most important factor in determining your FICO rating. By avoiding late payments, you can prepare for the success of your credit score. However, even occasional delinquency in your credit report could potentially be a major setback.
  • Consider opening new accounts. If you have a thin credit record or need to create a credit for the first time, opening new credit accounts can help. Without a credit history, it can be difficult to qualify for certain loans or credit cards. However, some options, such as secured credit cards or credit cards, may work well for you as long as you always pay on time. You might also consider asking a loved one to add you as an authorized user to an existing credit card account.

Find the best credit cards for 2022

No credit card is the best choice for every family, every purchase or every budget. We have selected the best credit cards in a way that is designed to be the most useful for the widest variety of readers.


Improving your credit can make it easier for you to qualify for attractive credit card rates. However, do not be discouraged if you need to increase your credit score in order to qualify for the best deals available. If you pay your entire account balance each month, you can enjoy the many benefits that credit cards have to offer without paying interest — regardless of your current credit card account this April.

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