A credit card balance transfer allows a person to move debt from one credit card to another credit card. A person might opt to do this if they want to simplify their finances and move all their credit debt to just one card, or to avoid paying high interest on the original card. The amount that you can transfer and the time it takes varies depending on the credit card company.
Getting the Most out of Your Balance Transfer
To use a balance transfer to your advantage, you should know how balance transfers work. Firstly, you must keep in mind that you’re moving your debt, not paying it off. Nonetheless, doing a balance transfer will allow you to save some money and consolidate your bills.
Getting a credit card with a 0 percent introductory rate to transfer your other credit card debts to, is key. Many credit card companies give people a 0 percent interest on a balance transfer for a limited amount of time. This typically lasts anywhere from a few months to one year. Call your companies to see which one can offer you a good deal.
Prioritize Your Debt
The next step is comparing the interest rates on your credit cards to find the account that charges you the least. If two credit cards have an identical balance, then the card that has the highest interest rate also has the higher monthly payment. Your interest rate should be printed on your statement.
The credit card with the highest interest rate should be given priority. By transferring that debt to a card with 0 percent interest rate, you will be saving yourself a lot of money in the long run.
Start a Payment Schedule
The best way capitalize on this credit card transfer is to take the time to set your finances in order. Keep in mind that the 0 percent interest rate is only for balance transfer. Any new purchase you make will be subjected to the regular interest rate.
By creating a debt payment schedule and a monthly budget, you can pay off your debts and start fresh from zero. There are many apps and budgeting tools that you can use to help you create a better picture of your monthly expenses, while sticking to a plan to pay off your credit cards.
For those whose credit card debt has gotten out of hand and is accompanied by other financial issues, you may need to take more aggressive action. The Louisiana bankruptcy attorneys at E. Orum Young Law Offices are seasoned lawyers who have helped many people like you recover from financial hardships. As a firm, we have filed over 20,000 bankruptcies in Northeast Louisiana and can use knowledge of bankruptcy law to help you. Contact us today for a free case evaluation. Our Trial Guarantee ensures that we will take your case to trial per your request.