Credit cards charge annual interest percentage rates (or APRs) on credit balances carried forward, and also on cash withdrawals. Transferring a balance from one credit card to another is also subject to APRs. The two kinds of APRs applicable to credit card users are variable and fixed. The variable kind means that the APR is subject to fluctuation according to factors that have nothing to do with your balance, withdrawals and credit rating. In other words, these factors are beyond your control and may be favorable or unfavorable in any given period of time.

Credit cards that charge low fixed interest on credit balances and cash withdrawals are far more manageable options for some customers. They may be the best bet when financial planning and periodic reviews of your balance statements is not your strong point, if you prefer a high degree of predictability in your credit-card-related financial status, or you have a consistent history of carrying forward balances from one month to the next.

Especially in the last instance, a fixed APR makes a lot of sense. One of the most common pitfalls of a variable APR is that users are often not aware of when and by how much the variations in interest take place. No matters how high the providing banks level of transparency is, it is simply not possible to keep track of these fluctuations for long periods of time. The problem is that even minute hikes in APR can accrue to significant amounts of interest debt towards the end of the year.

While a fixed APR on low interest credit cards definitely makes for increased oversight, it is not entirely free of fluctuations, either. In this case, however, the providing bank is obliged to keep users current on such changes in the interest rate before they are actually enforced.