Identification

• You probably do not need to worry about APR if you always pay your credit card bill before the grace period ends. In general, credit cards only charge interest when you carry a bill from month to month. If you have a credit card with no grace period, then APR matters because finances charges accrue as soon as you make a purchase, but credit cards with no grace period are rare at the time of publication.
  
  

Considerations

• Most Americans with credit cards carry some debt. As of 2010, the average consumer had $15,519 in credit card debt, according to Emily Minor of "The Palm Beach Post." You may be able to pay your bill on time now, but unforeseen disaster, such as unemployment, may cause you to carry a balance, and the higher the APR, the harder it will be to pay it off.
  
  

Different APRs

• Most credit cards have different APRs for certain types of transactions. For example, a cash advance may carry a higher interest rate than a purchase. Also, credit card companies have different ways of computing interest. Some use the balance from the previous billing cycle, but most use the average daily balance during the billing cycle. The cheapest is the adjusted balance, which is the balance at the end of the billing cycle.
  
  

Tip

• If you find the card with the lowest interest rate, you can lower your finance charges even further by paying the bill throughout the month. Because most credit card companies use a daily average balance, paying the balance multiple times in a month -- preferably right after you make a purchase -- lowers the average balance faster than making a lump sum payment at the end of the month.