There are a few important things that should be kept in mind when choosing a balance transfer credit card. The most important aspects are APR, associated fees, and the time period for which the low-APR rate is fixed or offered.

Assess Your Financial Position

But before considering the benefits of a balance transfer credit card, you must assess your financial situation and your credit card debt. Everything depends on whether you have a large amount of debt, or a manageable amount that can be paid off in a short period.

Fixed Rate Balance Transfer Credit Card

Thus if you have a large amount of debt that will most likely take a long time to pay off, you should consider choosing a balance transfer credit card with a fixed rate for the life of the balance, so that you can secure a low rate, usually under 5%, and you won’t have to worry about the introductory period disappearing after 6 or 12 months.

Such balance transfer credit cards mostly have no balance transfer fee either, and are a good choice for those with a large amount of debt. This way you won’t need to apply for a new credit card in 12 months once your APR spikes up above 20%.

But do remember that most balance transfers come with a balance transfer fee, though it is possible to find some credit cards with no balance transfer fee.

0% APR Credit Cards

In case you have a small amount of debt, you may want to consider a credit card that offers 0% introductory APR for the first 6 to 15 billing cycles. This is a good option if you don’t have much debt and think that you’ll be able to pay off the bulk of that credit card debt in 12 months. It is a great way to avoid paying any interest.

But most importantly, plan before you go for any sort of card. If you plan ahead, you may be able to save up and avoid paying the extra interest.

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