LAS VEGAS — The start of the new year can bring changes in credit card interest rates and trigger late fees and penalty rates
While the latest cut in short-term interest rates provides some relief in the form of lower credit card costs, the Fed is still unsure whether it will implement another rate cut. The next interest rate decision will take place Jan. 28, 2026.
As a result, credit card issuers may change the APRs (interest rates) on accounts tied to a variable index, such as the Prime Rate, without prior notice. Under the Credit CARD Act of 2009, issuers must give 45 days’ notice before increasing an interest rate. However, this does not apply to credit connected to variable indexes.
January also brings an increased risk of late fees and penalty APRs following holiday spending. According to TransUnion, 42% of holiday shoppers prefer credit cards as their preferred shopping method. After holiday spending, some consumers might miss payments, triggering penalties that push balance costs in January.
A 2025 report on average APRs shows that Nevada’s APR was slightly higher than that of other states in mid-2025. Consumers who carry unpaid balances may experience steeper cost increases as rates adjust.
To reduce the risk of costly penalties, consumers are encouraged to use automatic payments, payment reminders, and align payment due dates with their salaries.
