Low introductory interest rates, 0% interest on balance transfers, and the availability of interest-free days are all tools credit card companies use to attract new users. If you’re comparing credit cards, you should also evaluate the regular interest rates for each card you’re considering (which includes the regular purchase interest rate, cash advance interest rate, and what interest rate will apply to any balance transfers after the introductory period).

Why are regular interest rates so important? Your spending habits or credit needs may change in the future, and a low interest rate credit card (like the St. George Vertigo credit card) can help you avoid unnecessary debt.

How Credit Card Interest Accumulates

Credit card interest can build up quickly if you have a large balance being paid off over time. The particular billing period may vary from one card to the next, but here are the two formulas you would use to calculate interest:

1. APR / 365 days = Your Daily Percentage Rate (DPR)

2. Balance x DPR x days in billing period (eg. 30 days) = Interest added to your account

If you plan to carry a large balance (or if there’s any chance you may need to use your credit card to finance a large expense), forget about introductory periods and plug that possible balance and the regular interest rates into the formulas above to find out what a higher-interest card will really cost you. Even if it offers greater perks in the beginning, you’ll likely discover that you’ll pay significantly more over time by not choosing a regular low interest rate. Even potentially higher annual fees can pay for themselves quickly compared to higher interest cards.

Lower Interest Rates Give You Greater Financing Flexibility

By securing a low interest rate credit card (like the ANZ Low Rate MasterCard), you may even be able to save while paying off other debts. If you can use your credit card to pay off other obligations with higher interest rates or less attractive terms, paying them off with a low interest credit card can be a smart option.

Not only might that mean lower interest every month on the overall debt, but it might also mean negative items on your credit file will be marked as paid, improving your overall creditworthiness in the eyes of future lenders.

Low interest credit cards go beyond special offers and introductory rates. They give you more freedom to finance your purchases in a convenient way without costing an arm and a leg in added interest. On top of saving you money on future charges or balance transfers, they can even help you get out of debt. So if you feel like you’re drowning in debt, or even have one or two bills you’re just struggling to pay off, take a closer look at your credit cards. If they feature a low interest rate or more affordable payment terms each month, they may just be the answer you’ve been looking for.