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By: Tom Drake
Last Updated: Mar 14, 2019
One of the best weapons you have in your battle against debt is the 0% credit card balance transfer. With the right credit card, you can get a 0% rate for a few months.
During this time, it’s possible for the entire amount of your debt payment to go toward getting rid of your balance. This speeds things up since your payment isn’t being eaten up by interest charges. The faster you pay down your debt, and the less you pay in interest, the better off you’ll be.
The best balance transfer credit cards allow you to make significant progress in your debt pay down efforts. Use these credit cards as a tool in your debt repayment plan and they can speed up your debt payoff and save you money over time.
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A 0% interest rate credit card can be a great tool to help you pay down debt and get on top of your finances. However, you do need to be careful.
First of all, many of these credit cards charge more once the time is up. If you haven’t paid down your debt dramatically, you could end up paying even more on your debt. Choose a balance transfer card that has a longer intro period, if possible. A card like MBNA Platinum Mastercard is a good choice because you have a full year at 0% APR. That gives you time to really plan ahead.
If you transfer $4,000 in balances to the 0% interest rate card, and you have a year to pay it down, that’s $333.33 per month. See if you can free that up each month to get rid of debt quicker.
Other cards might not offer a long introductory period, or you might have to pay a small amount of interest, like 0.97% or 1.99%. Even in these cases, you can make a significant dent in your debt if you plan ahead. Your best results come when you commit to putting a set amount toward debt reduction and you stick to that.
If you know you can’t pay off the card in the set period of time, it can help to choose a card, like the Scotiabank Value VISA. You’ll have a relatively low rate when you’re done. Pay down as much as you can during the intro period, and then keep it up. You’ll still make decent progress, and it’s much better to pay 11.99% than it is to pay 22.97% interest.
The goal is to pay off your debt as fast as you can. With a good plan and discipline, a 0% APR balance transfer card can help.
DISCLAIMER: While we attempt to keep all credit card details current, the rates, fees, rewards and benefits may have changed since the last update. Please visit the credit card supplier through the “Apply Now” links to ensure you have the latest details for that card.
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