If you're in a considerable amount of credit card debt, it can be difficult to see the light at the end of the tunnel. After all, just making the minimum payment can make your progress feel slow or even non-existent. You may also not fully grasp how much interest you're paying month after month. Or, at this point, maybe you don't even want to know.
Balance Transfers: What You Need to Know
Fortunately, many have found that they can turn their situation around by transferring their credit card balances to a zero percent interest card. Doing so allows you to stop paying any interest for a certain amount of time and focus your energy on reducing your balance instead. But before you consider transferring a balance, there are certain factors you should consider, such as:
- Balance Transfer Fees- Many cards charge customers a fee for the privilege of transferring their balance to a zero percent interest card. Depending on the specific offer, that fee can add up to as much as 5 percent of your total balance. Before you transfer your balance blindly, find out if you will need to pay a balance transfer fee- and if so, how much.
- Interest Rates- Zero percent interest offers are typically only good for a specific time period with the average being around 12 months. Figure out how much you can save based on how long the promotional period runs, and decide if the move will be worth it.
- Your Credit- If you're opening a zero percent interest card with the intention of transferring several balances and closing old accounts, it's important to know how that might affect your credit. Chances are good that any negative effects will only be temporary, but it is still important to consider the consequences of such a move.
Zero Percent Interest Card Offers
Once you've weighed the pros and cons of your unique situation, it's time to find the right card. The following options might be just what you are looking for:
The Discover It card offers zero percent interest on transferred balances for as long as 18 months, and up to 6 months on new purchases. Better yet, the card also offers a rewards program that pays out as much as 5 percent back on categories that rotate each quarter. The card also comes without an annual fee, making it a good choice for anyone transferring a balance in order to save as much money as possible.
Citi Diamond Preferred
The Citi Diamond Preferred card offers the same 18 month zero percent interest offer as the Discover It card, but extends the zero percent offer to cover purchases for 18 months as well. The card also comes without an annual fee, access to a personalized concierge service, and zero liability on fraudulent purchases made with the card.
The Citi Simplicity card is another no annual fee card with a lot to offer those who are currently paying a high interest rate somewhere else. For starters, Citi Simplicity offers a zero percent interest rate on transferred balances and purchases for the first 18 months. After that, the interest rate jumps up to between 12.9% and 21.99%, depending on your credit worthiness.
Transferring a balance to a zero percent interest card can be a lucrative and rewarding experience. However, it is important to ensure that any decision you make is an informed one.