You can earn rewards on balance transfer cards but you won’t earn rewards on your transferred balance. You can still earn cash back, miles or even points on new spending – but you’ll accrue interest immediately.
Credit card rewards can be a helpful and lucrative benefit. You can earn cash back or frequent flyer miles, as well as points you can be redeemed for travel or other perks.
If, however, you are carrying a balance on a card – or if you have trouble paying your bills on time – you really shouldn’t be shopping around for a rewards credit card.
That’s because any rewards that you earn will be meager compared to the money you spend on interest charges or late fees. Instead, focus on paying off your balance and on lowering that monthly payment by finding a balance transfer card with a 0% introductory APR.
There are cards that offer both low-interest balance transfers and rewards. But you shouldn’t let the promise of rewards be the deciding factor in choosing a card.
See related: How to do a balance transfer in 5 steps
Benefits of a balance transferA balance transfer credit card can help you pay off a large balance in a timely manner and without getting charged interest (but typically for a fee of 3% or 5% of the transferred amount).
Let’s say, right now, you have a $2,000 balance on a credit card that has 25% annual interest. According to CreditCards.com’s payoff calculator, it would take payments of around $200 per month to pay off your credit card balance in 12 months. You would also pay approximately $267 in interest charges.
But if you transferred your balance to a balance transfer card with a promotional rate of 0% APR for 12 months and a 3% balance transfer fee, you could pay off your balance in 12 months by making payments of $172 per month.
You won’t pay interest on that balance, but you will pay immediate interest on any other charges, unless your card also has a 0% introductory APR on purchases.
See related: How do 0% APR credit cards work?
Can you earn rewards for a balance transfer?
Before you choose a balance transfer rewards card, you should know you do not earn rewards on the amount of a balance transfer. You earn rewards only on new spending. And if you’re carrying a balance, you’ll pay interest immediately on any new spending.
Let’s look at some examples. If you look at the best balance transfer credit cards, you’ll notice a wide variety of cards from different issuers. The cards on this list tend to have lower interest rates than other cards – as well as introductory balance transfer APRs of 0% for 12 to 18 months.
Some of the best balance transfer cards also happen to have rewards programs:
- The Citi® Double Cash Card offers a 0% introductory APR on balance transfers for the first 18 months (followed by a variable APR of 13.99% to 23.99%). You can also earn 1% cash back when you spend and another 1% when you pay off your purchases. But the card does not offer an introductory APR on purchases.
- The Bank of America® Cash Rewards credit card offers a 0% introductory APR on balance transfers and purchases for the first 15 billing cycles (then a variable APR of 13.99% to 23.99%). This card also allows you to earn 3% cash back on one of the following categories: gas, online shopping, dining, travel, drugstores or home improvement – it’s your choice. It also offers 2% cash back at grocery stores and wholesale clubs and 1% back on everything else.
- Similarly, the Wells Fargo Cash Wise Visa® card offers a 0% rate on balance transfers and purchases for the first 15 months (then a variable APR of 14.49% to 24.99% applies). Cardholders earn 1.5% cash back on all spending, and 1.8% back on Google Pay and Apple Pay purchases in the first 12 months from account opening. You can also score a $150 welcome bonus if you spend $500 in the first three months.
Should you get a balance transfer credit card without rewards?
If you are dead-set on earning rewards, you might want to separate the cards that have balances with those that have rewards. In other words, don’t try to earn rewards with cards on which you carry balances, because you will pay interest on those charges.
Instead, if you qualify for a rewards-earning card, don’t carry a balance on it. Rather, carry the balance on a card with low or introductory 0% interest.
And there are some good non-rewards-earning options among balance transfer cards. For instance, the Citi® Diamond Preferred® Card offers 0% APR on balance transfers and purchases for 18 months (then a variable APR of 14.74% to 24.74%). It also provides cardholders with VIP access to ticket sales, preferred seating and other perks through Citi Entertainment.
Should you get a balance transfer credit card with rewards?
If you like any of the aforementioned balance transfer cards that offer rewards, by all means apply for it. But you may want to consider holding off on making any new purchases on the new card until you’ve paid off your transferred balance. So, if you want one of these cards and want to earn rewards now, don’t transfer a balance to it.
See related: How long does a balance transfer take?
It’s better to focus on paying down your debt than worry about rewards. But if you absolutely must have a rewards card, make it one that you’re not paying interest for the privilege of earning rewards.