What Happens After the Introductory Offer

September 7th, 2010

Usually you’ll find that the introductory period for most credit cards is six months, and it can run at the same time as a 0% balance transfer offer. However, that offer, too, will end at some point.

2.99% p.a. for 12 months

Introductory Period Lengths

There are a few things you need to keep in mind when it comes to introductory periods. First, you must know that the regular rate of interest, or APR, is going to be once your introductory offer expires.

This is the interest that you’re going to have to start paying on any outstanding balance that’s on that card at that time, as well as any purchases you make in the future. This could be higher than normal to make up for all the money the credit card companies are losing. Some even commit the mistake in thinking that the purchases they make within that introductory period stay at 0% forever, and that only purchases made after the period is over are affected. This is a serious mistake that could cost you a lot of money.

Learn The Golden Rule

The first rule of introductory periods is to pay off your debt by the time the offer ends so that you can start anew once the new rate falls into place. Then, you should be able to pay off your balance each month so that you can keep from paying on that interest. Plus, you will have a good relationship with the credit card.

The 0% interest rate on things you buy should never be looked at as an excuse to go on a shopping spree. You can quickly run up the balance on a credit card in a few months and it can sometimes years to get rid of all that debt you’ve accumulated.

If you are building your debt during your 0% introductory period, and it’s because you’re only paying the minimum payment each month, you must be saving some money for when that introductory period comes to an end. Keep in mind that only paying the minimum amount is not a good thing to do. The only reason why you might want to do this is because you’re a cardholder for the purpose of making a single purchase that’s really necessary, and that you know you’ll be able to pay it off right away.

What is Stoozing?

If you’re smart, you can even make some money with your 0% credit card. This is called stoozing. This is where you buy things on the 0% purchases card and then put the cash you would have spent on the products into a high yielding savings account.

This will earn you interest instead of paying interest. This requires self control if you hope to do this, and you must be sure that you’re able to keep tabs on how much you’re spending and then set the right amount to the side so that you can pay off your debt in full just before the introductory period ends.