‘Consolidate credit card debt’ is a phrase you’ll hear again and again if you start hoarding several cards for all of your debts. Unless if you have an impressive system for managing all of these different accounts, sooner or later you’ll find yourself buried under extra interest payments, fees, and paperwork from all of your lenders.
One of the most popular ways to consolidate credit card debt is with a balance transfer card, which allows you to move your balances from other cards on to a new one with a discounted rate.
This introductory rate usually lasts for about a year, and can be as low as zero percent, so a balance transfer card can be a quick fix for anyone with towering repayments and finding it difficult to repay.
However, when balances are very high, it could take longer than a year to repay them, meaning that card users who still have debt after the introductory period are stuck with higher interest rates again.
Balance transfers can also have transaction fees, so read the fine print to make sure you avoid spending hundreds for switching over your debt. And when you have your shiny new balance transfer card, kick old habits and never miss a payment, or else you could see your rates bumped up higher than ever.
There are still other benefits when you consolidate credit card debt, including being able to manage all of your payments from a single account. If your card has a rewards program, this could give a big boost to your points once you start spending again.
A popular time to consolidate is just after the start of the New Year, when credit card users receive their bills from their Christmas and summer holiday shopping. But look out for deals and offers all year round, because credit card providers are always trying to attract new customers with their special rates.
Save yourself the stress and consolidate credit card debt before it spirals out of control. You can compare some of the cheapest rates in Australia at RateCity, and give yourself some down time from repayments today.