Credit cards have vastly become a sought after tool in order to establish credit. They also allow millions the ability to make purchases and pay them up at a later date. However, for many they are paying out extra fees due to interest. As most will understand, credit cards charge a certain amount of interest but if there is a large balance there will be a huge amount of interest.
Interestingly enough there are ways in which you can save thousands each and every year and it is all down to balance transfer.
What Is a Balance Transfer?
First and foremost, a balance transfer is basically when you take a large sum of money or the balance from one credit card and transfer it to another. However, when you transfer you can transfer to a zero interest credit card. This can absolutely help millions to save hundreds and hundreds of dollars each and every year, if not thousands of dollars.
A Vicious Cycle
Let’s say for a moment you had a credit card with an APR of 25%; this is one example, credit card change anything from around 13 to 25%, sometimes more, it depends on which creditor you get the card from. If you were to pay all charges at the end of the month you would be able to avoid interest charges however this isn’t always possible. There is a reason why credit cards are needed because you cannot afford to pay upfront for an item. Usually most users end up being charged a lot of interest.
If you aren’t able to pay the entire credit card bill off at the end of the month then interest is charged and a small amount of interest can soon rack up. You can actually pay back more in interest charges than what the actual item was worth and it really is crazy. Unfortunately this is a vicious cycle and something many struggle to avoid. The worst thing is the cycle never ends because people can’t afford to pay back the entire monthly charge at once.
However, when you look to balance transfer you can actually help save a lot of money. You can transfer a high balance from one credit card to another card. You have the ability to transfer the money to a card which has a zero interest rate for a certain period of time, say a year; or you could transfer to a lower interest rate. Either can be good and it allows you the opportunity to repay the money and potentially save thousands as well.
Be warned, there will be a transfer fee however, this isn’t usually extremely large and you still can save.
Which Credit Cards Offer Low Interest Rates
There are actually quite a few big name cards which offer low interest rate cards. For example you could look at Chase Slate. Now, this company won’t charge anything for the first two months, (60 days) and offer a zero interest option for the first fifteen months. This is not only good but can help to save a lot of cash. Also, you are not going to face any yearly fees and even when you transfer a balance you aren’t going to be charged any interest on the fee. However you do need to meet certain criteria.
Discover it is also great. You can have a zero interest option for all new purchases for the first six months you are with them and you don’t pay interest on the balance transfer either for the first eighteen months. There are also cash back for purchases up to a certain amount.
Saving Is Possible
There are a lot of high interest rate credit cards available and while they may be fine at first, they soon spiral out of control. When you are faced with a mountain of credit card charges you need to think fast and clearly and consider trying a balance transfer. It may just save you thousands of dollars.