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Over the past 6 months or so, we’ve witnessed a battle in the world of no interest credit cards. Citibank lobbed the first grenade when they introduced a limited offer of 0% on balance transfers for up to 18 months with the Platinum Select. Soon thereafter, they hiked it to 24 months, while also offering no interest on purchases for up to 12 months.
The 24-month promo didn’t last very long however, and they stepped down their transfer offer to 18 months, giving Discover the opportunity to step in and offer 0% on balance transfers for 24 months with the More rewards card. Since then, Citibank moved their offer back to 18 months. But the battle until now has taken place almost entirely in balance transfers.
Now, however, Citibank has pulled out the big guns with the most enticing no-interest credit card deal available. Not only can users move high-interest balances over to the Platinum Select and avoid paying interest for nearly two years, but they can also avoid paying interest on any new purchases. The new version of Citi’s premier low interest credit card is offering new cardholders a 0% APR for 18 months on both balance transfers and purchases.
Time to make that big-ticket purchase (or pay your taxes)
We don’t ever advocate that people should take advantage of deals like this in order to accumulate credit card debt. Once the promotion runs out, you’ll get dinged with high interest rates, or have to run off and find another 0% APR credit card to take its place. Neither is really optimal.
But, if you have a big-ticket purchase coming up, this could be a great money saver. For example, if you know you need to make some serious repairs to your car, or if you have a substantial tax bill looming over the next month, you can finance these purchases for nearly two years without interest. This is better than any financing deal you’ll get from a retailer, or even with any other credit card.
Another tactic that some credit card hackers like to employ (which we also won’t advocate, but it’s worth mentioning) is using a no-interest credit card to make investments. For example, if you can fund an online bank account with your credit card, this would allow you to earn interest on the money you invest, without paying interest to your card company for 18 months. Interest rates are pretty low right now, so it’s tough to make much money doing this, but I’ve heard stories of many people who do it anyway.
Plus, you still get the 0% interest on balance transfers as well, so if you are carrying any debt on another credit card, this could save you a substantial amount of money while you’re paying down your debts.