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Balance Transfer Credit Card Strategies

By: Gordon Goodfellow

To get most out of balance transfer credit card strategies
here is something you may want to put into practice
today.

When credit card companies issue 0 APR cards and
you transfer the balance, that balance (which was
previously costing you money in interest charges) is
now interest free (for a while). However, all the
repayments you are making to your new card only serve
to pay off the 0 APR portion of the debt. If you actually
use the new card for purchases or to get cash that will
attract interest, and that portion is not paid off by your
monthly installments. This is a sneaky way for the banks
to make more money by only letting you reduce the 0
interest debt, not the 15% interest debt or whatever it is -
you'll find this in the small print.

There are two ways to avoid this issue. The first is not to
make any goods purchases or draw cash at all with the
card after you've made the balance transfer. You must
treat this card solely as a card for handling your
transferred balance - you should literally not use it for
anything else. This may be difficult though, because it
means you can't actually use the card when you want to
and as you have been used to!

An alternative approach would be to use two cards. One
would be the card with the 0 APR transfer rate and the
other would be another card with a 0 APR or low APR,
or even a rewards program. It would work like this:

1. First choose your zero-percent card and make sure
that there are no hidden charges or annual fees.

2. Transfer your old balance to this new card and try to
pay as much of this balance off per month as you can.
Remember this balance now attracts no interest for the
number of months stated by the issuer of this particular
card - but it still has to be paid off! If you can't pay off the
entire balance, you can always transfer the balance
again to another card when the time comes (at the end
of the 0 APR period), so remember to transfer your
balance as that time approaches.

3. Find a second credit card that you can use in the
normal way for purchases, etc. You might even want a
card with a cashback rewards system of some sort. You
certainly want a card with a low APR rate or even a 0
APR rate on purchases as well as cash.

By doing this you've established a good debt
management program for yourself. You've taken a big
sum of money, moved it to a 0 APR card, and set up a
repayment plan. You also have a second card which
means you'll be able to carry on as normal. Do bear in
mind, though, that you do need to stick to the repayment
plan you've decided is best for you.

Gordon Goodfellow's sites automatically allow you to save money by transferring your credit card balance: Balance Transfer Credit Card Deals and the U.K. site is Balance Transfer Credit Card Deals.

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