How To Use Credit Cards Wisely

Never Pay Interest on Your Credit Card Again with This Easy Hack

4. Do not make any new purchases on your balance transfer card. While cards will vary, many have terms that will cause your balance transfer offer to either change or be cancelled if you make a new purchase.

Many cards apply payments to the balance with the lowest interest rate, so if your card has a 0% APR on balance transfers but a high interest rate on new purchases, your payments will go toward the balance transfer amount until it’s completely paid off. Meanwhile, your new purchases will sit around accruing interest (often upwards of 15%) for that entire time period.

5. Don’t close your old accounts, even after you’ve transferred your debt and have no use for them. Cut up the cards so you can’t use them, but keep the accounts open unless they have an annual fee associated with them. Part of your credit score is decided based on your credit to debt ratio, so every time you close an account, it knocks your score down a little.

6. Pay your balance in full before the promotional period ends. This is crucial! If something happens and you are unable to finish paying the balance off before the promotional period ends, you could be hit with huge amounts of interest fees that end up being higher than what you were paying previously.

As a last resort, you can try to apply for another balance transfer offer, but you should never rely on that.

It’s not a good idea to apply for lots of cards and do multiple balance transfers in a short time period, because it knocks your credit score down a few notches, and you might not be approved the next time.

There are lots of offers out there, and they’re always changing, so be sure to do your research. The right balance transfer offer for you will depend on your situation.

Balance transfer offers were down during the recession, but we are in the golden age of balance transfer offers again. If you want to double down on your debt, now is the time to do it. As with all things related to credit, just make sure to do it carefully!

About the author

Elizabeth Aldrich

Elizabeth Aldrich

Elizabeth is a freelance writer and “digital nomad” specializing in small business, entrepreneurship, career advice, real estate, travel, arts, and culture. She’s written for outlets as varied as Rawckus Music and Arts Magazine, Itcher Entertainment, Sweden Tips, Houzz, Hometalk, JobHero, Tico Times, and Eugene Weekly. Thanks to a three-year stint in a travel job, a knack for mining great deals, and credit card churning, she has not paid for a single flight since 2012, despite her constant travels. You can find her on Twitter @LizzieAldrich or her website, www.elizabethaldrich.com.

6 Comments

  • How can you help someone who’s
    Majority of debt is already written off and in collections?

    And what are some solutions to catch up on your HOA Fees when they been set to an Legal Debt Collection Agency, who’ s placed a
    Lien on your Home?

    I have already paid $804.00 towards the Total bill of $1120.00.
    Now there telling me it’s $1120.00,
    Including the attorney fees!
    With this plan I will lose my home!

    I am disabled and struggling to keep this up! I have already sent a letter explaining my situation and emailed & faxed to my Case Manager. My home is only 4 yrs. old, and I was only 3 years behind $600.00 + there Legal Fees!

    So, my request was to pay off my pass due without the Legal Fees. Within two minutes they answered,
    declining my request!

    Can you please send any suggestions to help me keep my Home ?

    Sincerely ,
    Jeanine Thomas

  • I have a question: if you have taken out a consolidation loan and want to take advantage of the 0% by transferring to a credit card can you do this?

  • The big question is why do people even need to rack up such huge debt ? Habits are hard to change. Transfer, sure, but the odds are that the debtor will wind up owing yet another balance sooner than later.

  • have 2/3 cards I would like to transfer to a no/low interest card. unfortunately I cannot get any company to give me a large enough balance to transfer them. their reasoning is that I already have too much debt load…

    • Pay then in small chucks up to what you are allowed at the maximum amount then do another balance transfer. Wash, Rinse, Repeat.

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