How Not To Use 0% Balance Transfer Credit Cards

By now, most people with at least a little financial knowledge know the basics of how to use a balance transfer credit card

.

It's a mule card, designed to take the weight of high-interest balances from elsewhere off your shoulders and carry them for you through the less rocky streets of low to no interest rates.

Unfortunately, what some people don't realise is that this is one horse that's still a little way from being completely tamed.

Yes, if you're not careful that mule could buck your balance leaving you with less bucks to your balance then you'd like.

So what are the metaphorical sugar lumps that you can use to keep your 0% balance transfer credit cards sweet? And which metaphorical mice should you keep away to stop them scaring the horses.

Ok, no more horse similes from this point on just two great tip top tips on how not to use a 0% balance transfer credit card.

First, try not to use your balance transfer credit card for spending.

The interest rate that you pay on your purchases made with the card is typically high and is usually paid back after the whole balance transfer has been paid off.

That could mean a lot of necessary months of paying interest on the things that you've bought with the card - you wouldn't expect to pay with a mule now would you?

Ok, that's absolutely the last time.

There are some exceptions to this rule, such as credit cards that have zero interest on purchases for the same amount of time as the balance transfer offer.

With these pieces of plastic such as the Halifax All in One credit card you can't run the risk of trapping one balance under another, you just have to pay off both at the same time.

Still it's usually best to avoid this altogether in case you accidentally make a cash transaction instead of a purchase, which is charged at a higher rate and without an interest free period as most plastic transactions are.

The second thing not to do is get rid of certain balance transfer cards straight away.

For example, the Virgin Money credit card is well known for offering balance transfer offers in the future to users that hold on to the card so this is sometimes worth it for users that have a number of credit cards.

by: Julia Cook

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