Tips to reduce your debt with balance transfer credit cards

Transferring balances can be a great way to get the most out of your credit cards and trim down your debt.

13:09 10 December 2013

If you are paying a high rate of interest on your credit cards, you may be missing out on a great opportunity to save money. You may have received these balance transfer credit cards offers before, they offer to allow you to transfer some or all of an existing balance to a new card with a low rate of interest for a specified period.

Many people fail to notice balance transfer credit card offers because they already have their limit of credit cards and are not looking for more. However, you may be missing out on a great opportunity to do away with your debt quickly. The biggest hassle with credit card debt is the interest. Interest payments can cripple your ability to pay off your debt.

This is why balance transfer credit cards are a vital tool; here is how to make use of these cards to reduce your debt.

• Look for offers that provide you with a 0% to 9% APR for balance transfers. This is generally for 3 to 6 months.

 

• Compare these credit cards. Some of these lenders will have annual fees or high interest rates.

 

• If you have large balances, do not look to transfer the entire amount. Transfer a portion of it. This will give you less interest on the high rate credit cards and allow you to pay off a portion faster. A card with low interest rates over a long period is just what you need.

 

• Do not look to keep the card unless it has a lower interest rate than the card you have now. These offers generally have high interest rates after the promotional period.

 

• Consider dropping the credit card as soon as the promotional period is over. To facilitate this do not transfer more to the card than can be paid off in the promotional period.