In life, it really is all about balance. You know, like going to Applebee’s and ordering a big, green salad with your endless appletinis. 🥗🍸 An apple a day keeps the doctor away!
If you’re up to your ears in credit card debt, a balance transfer could get you out of trouble fast. 🤸 However, there’s some fine print to consider before signing on the dotted line. 👀
Here’s Five Fast Facts on balance transfers:
- 💳 Balance Transfer 101 - How does a balance transfer even work? Balance transfer credit cards let you move your existing credit card balances onto a new card with a 0% interest rate. The 0% interest rate is temporary, usually between 12 and 21 months. This helps you pay things off without racking up any more interest.
- 📉 Saved By Zero - With the average credit card interest rate at almost 25%, you might feel like your payments aren’t even making a dent. However, through a balance transfer, you can cut the debt out much faster and save hundreds (or even thousands) of dollars.
- 🤔 Mull This Over - If you’re considering a balance transfer, there’s a few things to consider. In some cases, there may be a 3-5% fee on the initial transfer. The biggest thing to remember is that the 0% period is temporary. After that, it’ll get swapped out for a regular (high AF) rate. Also, that 0% might only apply to the transferred balances and not any new purchases you put on the new card.
- ✅ Credit Check - Is a balance transfer right for you? If you have decent credit, you should be approved for one pretty easily. Aim for a 670 credit score or better. Balance transfers are also good for those who are committed to paying things off within the 0% period. Keeping up bad credit card habits could put you into a Groundhog Day situation.
- 🧮 Smart Math - Here’s a balance transfer formula so easy, a caveman could do it. First, move those balances onto one card. Next, divide the total balance by the number of 0% interest months. Set up automatic payments to pay that amount each month and kiss that debt bye-bye.
🔥Bottom line: Americans are in deeper credit card debt than ever before. However, this past January, a ton of folks hung up their “treat yo’self” hats and focused on more practical money moves. In this article, we break down the January retail sales slump!
Have you used the balance transfer strategy to get out of debt?
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