If you have a credit card (you wouldn?t be reading this if you didn?t) then you?ve gotten an offer for a balance transfer. Transferring credit card debt from one card to another is, in theory, a good option for lowering interest rates and saving money. Credit lenders offer you a low balance transfer interest rate, sometimes as little as zero percent, and you benefit from having all your debt in one place ? away from the high-interest card that previously contained it.
On the surface, it?s a good plan. The ostensible benefits of any debt consolidation plan ? convenience and lower interest ? are certainly achieved with a balance transfer. But most balance transfer offers come with at least one catch: the low transfer rate is only temporary, or there is a transfer fee which negates the benefit of the low introductory interest rate.
This is the trouble with all debt consolidation plans: the long term benefit (the possible savings over the years of a lower interest rate) is negated by the short term trouble (an exorbitant fee). The fundamental problem with debt consolidation is that it?s just a band-aid. Any debt consolidation plan will only move your debt from one place to another - it will not actually reduce the amount you owe.
This is where the balance transfer failed me. Though I did enjoy having all my debt in one place, I was still stuck with a lot of high interest debt; it was just all in one place! I could still only afford the minimum payment on my credit cards every month, and even though my interest rate was lower, I wasn?t actually reducing the principal of my debt any more than I was before.
In the end, I had to take much more initiative to reduce my debt. Moving my debt to a more convenient location didn?t actually help anything, it just let me delude myself for a while into thinking I?d actually made some progress. If you are ready to make some actual progress on your problem debt, call Credit Solutions today!
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