Credit card bills can be quite a nuisance especially if you don’t nip the problem at the bud. Once you start to accumulate credit card debts from different companies, you might find yourself starting to get all confused on how much you owe which credit card company. Paying them all off may take a long time and it probably will be quite difficult to monitor the progress of your payments if you are paying off multiple credit card debts. One way to manage your credit card debts is by figuring out a way to consolidate credit card bills into one single debt that you have the option of paying off to one single creditor at a considerably lower interest rate.

One of the many ways to consolidate credit card bills is through the method of balance transfer. The key to this method is to choose one single credit card with a large credit limit and low interest rate among all the credit cards that you have. If all your credit cards carry a high interest rate, you might want to consider getting a new credit card that fulfils this requirement. Once you have selected the perfect card for this purpose, you may move your balances from your other credit cards to that particular card. If you have considerably low credit limit, you have the option of transferring just one or two of your highest interest rate credit cards first. One thing you have to bear in mind is that you may want to weigh your options first before consolidating your debts with a balance transfer because if you will not be saving money it is simply not worth the debt consolidation.

Using the balance transfer method to consolidate debt allows you to transfer the balance from a card with higher interest rate to a card with significantly lower interest rate. There are credit card companies that offer this type of credit card especially for the purpose of balance transfers and some of them even offer 0% annual percentage rate on the interest for up to 15 months. This way, no matter how much the amount of balance you transfer into the card, the credit card company won’t charge you any interest on the amount for up to 15 months; depending on the terms and conditions of the particular card.

It may be obvious to you that the benefit of balance transfers is to cease paying a high interest on several credit cards and concentrate on paying off the principal on your current debt as you most probably won’t be paying any interest for at least the duration of the first year. You may want to be careful and not use the convenience of balance transfers as an excuse for you to go out and accumulate more debts along the way. It is advisable that you focus on getting rid of your existing debts first and ideally avoid getting yourself much deeper in debts later on.

There may be times when you won’t be able to transfer the entire amount of your many credit cards on to one single credit card. However, it would not do you any good to simply give up. If your credit card debt is relatively high, paying it all off is going to take some time and might require for you to be more disciplined than ever before. Another factor you might want to consider is the transfer fee. Although most balance transfer cards offer 0% interest rate in the first year, most will impose a certain fee for the transfer up to 4%. So before you sign up for any balance transfer credit card, it is advisable that you read the terms and conditions as well as understand every single word of it. You definitely would not want to be surprised with an interest charge after only three months of using the balance transfer card, simply because you assumed the 0% APR will be for the entire first year.

Essentially, getting yourself out of credit card debts depends on your determination and strength to discipline yourself to avoid accumulating more debts than you can actually afford. It is advisable that you do not wait until the debts pile up before you take the necessary actions to solve the issue.

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Category: Finances
Keywords: consolidate credit card bills, consolidate debt, credit card debt