disadvantages of variable interest rate cards

Advantages: 1. Lower Interest Rates: With a variable rate card, the cardholder can benefit from lower interest rates when the rate is low. As the market rate goes down, cardholders can potentially save more money due to the lower interest rate. 2. Flexibility: Variable interest rate cards give the cardholder more flexibility to pay off their debts. If the interest rate fluctuates, the cardholder can make more payments or pay more than required to pay off the debt quicker with the lower rate. Disadvantage: 1. Uncertainty: With a variable interest rate card, the cardholder never knows what the rate will be. This makes budgeting difficult, as the cardholder cannot accurately estimate their interest payments in the future. With a fixed rate card, the cardholder always knows what their rate and payments will be, making budgeting easier. 2. Increased Payments: Since the rate can fluctuate, the monthly payments for the card can also rise. If the rate goes up, the monthly payments can make the card much more difficult to pay off. This can create a strain on the cardholder's finances and make it difficult to make payments on time.