Now that we’ve covered the balance transfer basics, there are just a few other things that conscientious credit card holders such as yourself need to know about:
Balance transfers don’t happen overnight. Your application will take time to be approved, and the actual balance transfer itself can take a couple of days after approval. I recommend that you factor up to four weeks of repayments on your old card (from the date of your application) into your budget.
Most interest-free deals apply only to the balance transfer amount. This means that if you make any additional purchases on your new card, you’ll start paying interest on them straight away. If you’re serious about repaying your debt, cut up your new credit card as soon as it comes in the mail.
There’s no point getting a balance transfer if you keep both cards. It’s critical that, once you pay off the small remainder on your original credit card you shut the account down. Otherwise, you may find yourself with literally twice as much debt than when you started your journey to financial freedom.
Balance transfers aren’t for everyone. If you’ve got multiple debts like personal loans, credit cards and old balance transfers, you might be better off getting a debt consolidation loan.
Be wary of special features and offers on new credit cards. I’m not talking about low/no interest promotions here, but cash back deals, insurance discounts and other discounts that credit card companies use to lure you in. While these features may be of some use to some people, they should never be the main selling point.