A 0 balance transfer can save you hundreds of pounds in interest charges, but only if you use it properly. This is why it’s important to understand the details of these offers so you know when to take advantage of them. If you’ve been paying on your credit card for a while and are getting close to the limit, now may be a good time to consider a transfer to a 0 balance card. Even if your current balance is low, transferring your balances to a 0% interest card can lower the amount of interest you have to pay. This allows you to pay off your credit card faster and not stress out about paying off the balance.
If you are trying to reduce your current debt load as much as possible, now might be a great time to consider a credit card transfer to get a lower balance, or to start paying off your credit card at a lower interest rate. Using an introductory offer card to pay off your high-interest credit card debt can help you do that if you make your payments on time and in full. In order to do this, however, you need to be disciplined. Follow these helpful tips for an aggressive pay off.
Be smart about how you use your credit cards. Don’t just charge to watch and hope that you’ll have enough money to cover the debt balance when the interest charges kick in. Instead, work toward paying off your debts at an accelerated pace. Add to that the fees you’ll be paying if you don’t repay your credit card debt balances on time and you’ll quickly find yourself overwhelmed. The best way to do that is to transfer your high interest debt balances onto a 0% interest card to reduce the pressure.
Also, be aware of the 0 balance transfer fee that each credit card offer has. Most 0 balance transfer offers come with an introductory period, which means they’ll give you a high interest rate for a short period of time. While it’s tempting to take advantage of this 0 balance transfer fee, it can quickly work against you. After the promotional period is over, you’ll likely find your credit line has increased, and you’ll be charged regular interest rates.
If you can, the best way to avoid the 0 balance transfer credit card charge is to choose the 0 introductory period that has the least restrictive features. If your card has an unusually high balance or a long-deferred interest rate, you’ll probably want to transfer your balance sooner rather than later. A low or zero percent introductory rate can make a big difference in your ability to pay down your debt balance quickly. If you want to enjoy a long-deferred interest rate on your new credit card, consider transferring your balances during the introductory period.
As a general rule, the more available credit lines you have, the better. The lower the interest rate on your current lines, the less money you’ll be paying in interest charges. This means transferring balances to accounts with lower interest rates to free up some of your available credit. You can then use the extra cash on those accounts to pay down your debt as quickly as possible.
Don’t mix up your payments. Most credit card providers will charge a balance transfer fee for any amount you transfer to another card, even if it’s not much. Make sure to keep all your monthly payments on one credit card, so that you only pay interest on the amount of actual credit that you use.
Another strategy to help you avoid the credit card balance transfer fee is to pay off your new purchases more quickly than your old ones. Credit cards generally offer a special rate of 30% on new purchases. If you’re paying the same amount each month on your credit card as you were paying for your old purchases, it doesn’t make sense to take advantage of the special rate. Instead, gradually pay more each month, until you have completely paid off your old purchases.