Advice on Using Lifetime Balance Transfer Cards

Deciding to make a lifetime balance transfer to a credit card with a lower transfer interest rate is just the first step to gaining control over your debt. After you have had your credit card application approved and received your balance transfer card, here is some advice to help you stay on the right track:

· Transfer your balance as soon as possible. If your old credit card balance isn’t automatically transferred to your new low rate card as part of the application you need to make the transfer as soon as possible. This allows you to take advantage of the lower transfer interest rate right away, and ensures that you don’t miss out on the low interest rate offer on a balance transfer if a promotion ends, or the card provider has a transfer time limit.

· Find out how to start. If possible, enter the balance transfer information in your original application form. If you’ve missed this opportunity, look for the special forms which will have arrived in the post with your card, or simply call the card provider or access your account online to make the transfer.

· Budget to repay your debt. Just because you have the luxury of time in a lifetime low interest rate doesn’t mean it has to take your entire lifetime to repay your debt; firstly because you are still paying interest on your balance even though it is less and secondly because a lifetime balance transfer refers to the life of the balance and is not an encouragement to take a lifetime to repay your debt. Instead work out a budget that allows you to pay off your balance as soon as possible and which sees you paying more than the minimum each month.

· Never forget your monthly repayments. Just because you have a low interest rate guaranteed for life doesn’t mean you don’t still have a monthly commitment because there is still a minimum monthly amount required on your balance transfer credit card. It is also important to note that some transfer offers will be void if you miss a monthly repayment and you will be back to that high rate of interest, not to mention collecting a mark on your credit report.

· Don’t use your balance transfer card for other purchases. You will have made a choice about the best credit card for you based on your lifetime balance transfer needs, therefore keep this card for your balance transfer only. The purchase interest rate is likely to be much higher than you could have found on an everyday credit card and the same goes for the card’s cash advance rate. Making purchases on your card also means you will be paying that higher purchase interest rate for longer - until you’ve paid off your transferred balance in fact because the most recent transactions are paid off last.

Timothy Ng is the content writer for a network of personal finance websites including www.creditcardfinder.com.au. He is a regular contributor of educational articles, press releases, blog posts, videos and all information related to personal finance. His areas of specialty include: home loans, debt consolidation, savings accounts, term deposits, foreign exchange and other financial matters. If you request a certain topic to be covered you can send an email to tim@creditcardfinder.com.au and he will respond appropriately.