Is There a New Card King for Balance Transfers?

Update June 2014:  The balance transfer offer for the Barclaycard Rewards card has expired.  This means that by default the Discover 18 month interest free offer is the King!

Please note: These are special links in this post that give you better offers than the usual offer if you went straight to the card web site.  Make sure to always use the TWM links to get the best offers and help support our site!

Back in August, we answered a reader question about the best credit card for a balance transfer.  If you currently are paying interest on a credit card balance and you won’t have it paid off in 3 or less months, a balance transfer is a smart financial move.  Our previous recommendation was the Discover It card that has a 18 month 0% interest free period for balance transfers with a 3% fee. This means that on the first month you will pay a 3% transfer fee then you will pay no interest at all for the next 18 months.  Example would be if you transfer a $10,000 balance, you would get a first months bill for $10,300.  But then for the next 18 months (as long as you pay on time) you will pay zero interest!

Just yesterday we learned about a new promotion for the Barclaycard® Rewards MasterCard® that could be even better than the Discover It offer.  We have also added this card to our Top Credit Cards page.  Let’s look at the offer in detail.Barclaycard RewardsThe Barclaycard Rewards card has the following benefits:

  • Earn 2 points per $1 on gas, grocery, and utility purchases
  • Earn 1 point per $1 everywhere else
  • Complimentary FICO® Scores as a benefit to active cardmembers. Opt-in to have instant and convenient access to FICO® Scores from your Barclaycard online account.

Here is a chart I prepared that shows you how quickly you can profit from a balance transfer (including the transfer fee) depending on how much your current interest rate is.

Current APR Months before profit after transfer fee
5% 7.2
10% 3.6
15% 2.4
20% 1.8
25% 1.4

How does this compare to the Discover offer?

Discover It Barclaycard Rewards
0% Interest on Purchases 6 months 18 months
0% Interest on Balance Transfers 18 months 18 months
Balance Transfer Fee 3% 3%
Rewards program 5% on quarterly rotating categories, 1% on the rest 2% on Gas, Groceries, Utiities, 1% on the rest
Online shopping Rewards Yes, Discover Mall Yes, Barclays Rewards Boost
Annual Fee $0 $0
Free FICO Score Yes, on your statement monthly Yes, accessed online

Conclusion: Who is the King of the Balance Transfers

As you can see by the above chart, the offers are really neck and neck.  The extra 12 months of 0% on purchases could make a difference for some and push the Barclays offer ahead.  The rewards programs are both good but there are better programs where you can earn miles so I would recommend these cards mainly if you have a balance you are paying interest on.  Either of these cards will help you get your balance paid off quickly and seeing that $0 interest charge each month will definitely make you feel warm and fuzzy. I think the Discover might be a little easier to get approved for, but if your credit is already good then diversifying your banks to Barclays might make sense.

So what are you waiting for?  Click here to apply for the Barclaycard® Rewards MasterCard® or Click here to apply for the Discover Card.

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Author: John Butler

I live in Miami Beach but love travelling all over the world.