Reduce Your Debt with a Credit Card Balance Transfer

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Reduce Your Debt with a Credit Card Balance Transfer

Reduce Your Debt with a Credit Card Balance Transfer

If holiday spending has left you with a higher credit card balance than you intended, a credit card balance transfer can help you get your finances back on track in the New Year. Transferring your credit card balances to a new card allows you to consolidate your balances to one single payment with a more manageable interest rate. In addition to having less debt, you can enjoy these other benefits of a credit card balance transfer:

Lower Interest Rate

Receiving a lower interest rate is the biggest reason you would want to transfer your credit card balance. A reduced interest rate can help reduce your monthly payment to free up more room in your budget if your finances have become stretched too thin. Or a lower rate can help your monthly payment go further and make a bigger impact towards reducing your balance to help you pay off your debt faster. The lower the rate, the more you can save. Many lenders also offer promotional offers with an extra low rate. If you get a special limited-time rate, make sure you know when the rate is set to expire so you can have your balance paid off before the promotional period ends.

Get Better Terms

Stay away from cards with sky-high interest rates, excessive fees, minimal to no grace period, or a rewards program you don’t use. Your credit card isn’t doing you any favors if the terms don’t work for you. Instead, switch to card with positive benefits like better rates, a rewards program you’ll actually want to take advantage of, discounts, and more. Reward yourself with a credit card that comes with features and benefits that help you make the most of your card.

Simplify Your Life by Consolidating Debt

Transferring your balances to one credit card can make your financial life so much easier to manage. Rather than struggling with multiple credit cards each with different balances, interest rates, and payment schedules, you can consolidate your debt to a single lower-rate card with one balance to pay off and one due date. Streamlining your credit card debt makes it easier to pay off one card and not have to stress over keeping track of the details of multiple cards. With just one monthly credit card payment, you can make sure you never miss another payment due date again. Focusing your payoff strategy on one card will help you get your debt paid off much faster.

Improve Your Credit Score

Moving debts from multiple credit cards to one single card with a balance transfer could decrease your overall credit utilization. Your credit utilization ratio is a major factor in determining your credit score – it accounts for 30% of your score calculation. Credit utilization measures the percentage of credit you use out of your total credit limit. The lower your utilization ratio, the better, thus the more likely you are to increase your credit score. A low credit utilization reflects to credit lenders and the credit bureaus responsible for calculating your credit score that you aren’t racking up credit card debts you won’t be able to repay. Experts recommend maintaining a credit utilization below 30%. Transferring your credit card balances can reduce your overall credit utilization, helping you pave the way to increase your credit score.

We’ve made applying for a credit card balance transfer even easier for you by adding a new balance transfer form in Digital Banking. No more calling or coming in to branch! Now all you have to do is fill out your information right from your phone or computer. Log in to Digital Banking, select Cards in the main menu on the left, select Balance Transfer, enter the information, and submit. That’s it! Let a fee-free balance transfer to our Visa® Platinum Rewards Credit Card put you on the road to recovery from credit card debt.

At Robins Financial Credit Union, our mission is to enhance the financial well-being of our members and community. We honor this commitment by providing educational content to help you make the most of your finances. Read our other blog articles to help you gain the financial knowledge you need to succeed.

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