Budgeting With Balance Transfer Credit Cards

February 15th, 2010

Appreciate the importance of budgeting with balance transfer cards. Understand why new habits must be learned for debt to become a thing of the past.

0.99% p.a. for 12 months

Budgeting is a great life-skill to possess generally; it is very important if you carry a credit card; and it is crucial if you are going to apply for a balance transfer card.

Anyone who has the need to apply for a balance transfer credit card has obviously managed to get themselves into a debt that is causing problems. This should bring the issue of budgeting fully under the spotlight. If it doesn’t, then your thinking has a way to go before it becomes commendable, and you are apt to renew your debt just as soon as you pay it off.

Making an application for a balance transfer card is not the end of the story; it is the start. It should equate to a resolution to order your finances more carefully, and perhaps make some much-needed and long-overdue changes in how you handle money.

Balance transfer credit card tips

However, credit card debt can happen to the best of us, and it is not always down to fiscal recklessness. Many sensible and responsible people have been pushed into debt by the economic crisis these past two years. But no matter how debt happens, one of the key escape routes is proper budgeting.

To make sure you clear your debt before your offer period expires, you must look carefully at your income and expenditure, and analyse your expenditure in particular. While there may be little you can do to increase the money coming in, you can nearly always reduce the money going out, however uncomfortable that may feel. If you are sincere about making good use of your balance transfer card, then your outgoings need to be split into essential and non-essential, and this must be done with brutal honesty. Every extra dollar you can throw at your debt will help clear it quicker and hopefully before the end of the offer period.

If your debt is entirely of your own making, then taking a balance transfer credit card should act as a wake-up call. Although the card can help immensely, it is a short-term fix. It is not the way to deal with debt, or a reason to continue falling into it. Being approved for a balance transfer card requires that you have a good credit history, so taking one card after another to fund your overspending will not work for ever. Sooner rather than later, credit card providers will see what you are doing and pull the plug. Then you will be left with the last card you applied for, and the regular interest rate applying to it.

Editors Choice: Featured Credit Card Deals

	Interest Rate (p.a.)	Balance Transfer Rate (p.a.)	Annual fee	Cash Advance Rate (p.a.)
Westpac 55 Day Credit Card	0% for 5 months (reverts to 19.59% )	3.99% for 6 months	$0	21.49%
Citibank Clear Platinum Card	11.99%	2.9% for 12 months	$99	21.74%