Credit cards provide cash for different expenditures, which would have been otherwise impossible. Whenever you find an item that you like to purchase, you purchase it then and there by charging your credit card. Many people do not even stop to think that the amount will have to be paid eventually and when the time of payment finally arrives they find themselves in a fix. Fortunately, there is a way to save yourself from the disaster which can occur due to this situation. This way is known as debt consolidation. Debt consolidation can be done through different methods and one of these methods is balance transfer.
This involves transferring all your credit card debts to one credit card which has a very low interest rate. This cuts down the number of monthly payments to one. There are many such cards available but you should choose among them after going through the terms and conditions including the fine print. By going through these details, you will be able to choose the best card. Ideally, the best card will be the one which does not have any charges for balance transfer, has 0% as introductory interest rate and does not charge any annual fee for the first year. This card should be used for the purpose of balance transfer only. You should keep another card for emergencies. However, if you want to use this card for the purpose of making purchases, read the fine print one more time.
Find out the limit of this credit card, the interest charged on purchases and cash-back rewards. By doing this, you will be able to take the best decision.
You do not have to stick to one credit card after you have transferred the balance of your credit card debts to it. You can transfer the total balance to another credit card once the time period for which the introductory interest rate is applicable, is over or you have to pay for annual charges. By doing this, you will be able to easily manage your debt.
Hence, debt consolidation through balance transfer is the best option if you have a lot of credit card debts. Choose the right card for this purpose and switch over to another card, once the charges of the first card increase.