The length of time you will need to pay down your balance transfer will depend on the length of the balance transfer period, along with your budgeting skills and financial situation.
Firstly, take stock of your finances. Look at your income, expenses, assets and any savings you have. If you’re serious about getting on top of your debt, you’ll need to be strict about what expenses you can lessen or cut out and how much of your income and savings you can put towards your debt on an ongoing basis.
For example, if you have a $2,000 credit card debt, and can afford to budget $300 a month towards this debt, it would take around 7 months to pay off this debt in full. If you had to pay interest on this debt too, this time frame could increase. This is where 0% interest balance transfers come in handy.
Next, when you compare balance transfer cards, you will see that each card issuer offers varying periods of time for their zero per cent interest windows. If you have a smaller debt, you may be able to opt for a shorter balance transfer term, such as under 12 months. However, if you’re struggling with a large credit card debt, you may need to consider if a longer zero per cent balance transfer term of 2 years or more would better suit your budget. Ultimately, the length of time you need to pay down your debt depends on your personal circumstances.
You may also find that you’re unable to pay off your debt within your balance transfer term. This can have adverse effects on your debt as the standard purchase rate of balance transfer cards is typically quite high, causing your debt to grow further. Try and work within your budget and financial situation when choosing a balance transfer term.