Will balance transfers benefit your budget?
28 May 2008
Balance transfers do not suit everyone as a means of addressing credit card debt. Not everyone understands how balance transfers work, and they will often get caught in a situation where they merely build up new debts without fixing the old ones. In order to get the most out of balance transfers it is necessary to first prepare yourself for the financial impact it will have on your budget.
If you are still using your credit card as a line of credit, balance transfers cannot help you, as you will be tempted to use your credit card before you have repaid your transferred balances. Unfortunately, balance transfers are usually only offered with the proviso that they must be paid off before new charges can be addressed, and often interest free days on purchases do not come into effect until the balance has been reduced to nil credit. To make full use of the benefits of balance transfers, you will need to be ready to pay off your debt in full. If this doesn't seem possible to you, you may wish to consider a debt consolidation loan instead and possibly then reduce the number of credit cards you have as well as your maximum allowable credit.
Please visit our comparison pages to learn more about credit cards with special offers on balance transfers.
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