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Three Signs You Need to Do a Balance Transfer

Three Signs You Need to Do a Balance Transfer

If you throw away any balance transfer offer that comes your way, thinking you don’t need to take advantage of such a thing, you could be throwing money away. Balance transfer offers aren’t scams or tricks to lure you into spending money. Rather, they are valuable offers that can save you money and help you get out of debt faster than you thought possible.

If your credit card debt seems like a black hole you will never get out of, you need to read this article. And even if you only have a small amount of lingering debt, this is for you, too. Here are three signs that you need to pay attention next time a balance transfer offer comes your way:

  • Your credit card has a high interest rate. You may not even know what the interest rate is on your credit card. Many people do not. And when you do look at the number, it may not mean much to you. But you need to know your interest rate—also called your APR, or Annual Percentage Rate. If it is too high, you can do a balance transfer to a lower-rate credit card. How high is too high? Anything over 15% is definitely too high. But really, anything over 1% is too high when you consider the number of balance transfer offers out there offering 0% or 1%.
  • You are trying to pay off a balance, but you still use your card. This is a mistake. When you continue to use your card, the money you pay each month goes only to the part of your balance with the lowest interest rate. That means the high-rate portion of your balance remains untouched and you will never be able to pay off your card. You need to apply for a balance transfer credit card and then never use it to make a purchase. Transfer the balance and pay it off your new card without using it for anything else. If you are using a card to pay daily expenses, start fresh with a new card at zero balance, and pay it off in full every month.
  • Your balance isn’t budging. If you are paying all you can afford every month and still your balance is not edging downward, something is wrong. You are probably paying interest that is way too high. Stop using the card, and see if the balance goes down the next month. If it doesn’t, your APR is probably sky-high. You need to do a balance transfer. Find the card that is right for you and apply for a fresh start so you can pay down your debt.

A balance transfer offer can help you be debt-free before you know it. Research offers and find one that’s right for you.


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