How to Use a Life of Balance Transfer Credit Card

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Life of balance transfer credit cards allow you to move expensive credit card debt to a new cheap rate credit card - giving you the chance to actually start taking chunks out of your credit card balance and removing the worry of spiralling interest charges.

With your credit card balance back under control, start to repay as much as you can comfortably afford to each month and you'll soon see the balance reducing.

Make the most of your card...

- Transfer quickly
Life of balance transfer credit cards will only allow you a set time frame in which to transfer your balance to get the promotional rate.

Find out how long you have and make sure you arrange your transfer in good time. You can always play it safe and make the transfer during card application - if you don't want to do this, make sure you set the ball rolling as soon as receive your new plastic in the post.

- Know how to transfer
If you decide not to begin your balance transfer during card application you can still make the transfer through a range of ways:
- Using the 'balance transfer' forms sent out with your new card
- Via telephone banking
- Via online banking

- Pay as much as you can comfortably afford to
Now you've got a cheap rate on your credit card debt, make the most of it!

Budget your income and try to repay as much as you can comfortably afford to each month.

Your life of balance transfer credit card will allow you plenty of time to repay the balance, so you don't need to rush and live off beans on toast every evening.

Decide how much you can afford to repay each month and try to stick to it - you don't need to rush, but the sooner it's repaid the sooner you can be free from the worry of credit card debt.

Things to watch out for...

- Always make your payments
It's crucial to always make at least the minimum required payment each month - obviously you should try to repay more than this - but this is the minimum amount required by the terms and conditions of the offer.

If you're late with a payment, or you miss a payment altogether you could lose the promotional rate on your balance transfer, and it will also damage your credit score.

If you're set up with Internet banking you'll usually be sent an e-mail when your monthly payment is due.

However, the fail safe method is to set up a direct debit of an amount you can afford to repay each month - this will also see your balance transfer gradually reduce without the worry of ever having to remember to make a payment.

- Avoid the ATM!
Aside from not using your life of balance transfer credit card for purchase spending - you should also steer well clear of any ATM machines.

Withdrawing cash on your balance transfer credit card will see you back in the land of high interest charges and worrying debt.

Not only do cash transactions incur handling fees and higher rates of interest, but as a higher rate balance, they will become trapped behind your cheaper balance transfer, accruing a hefty chunk of interest until you first repay your balance transfer.

Always use your debit card for any cash transactions - including ATM withdrawals, getting 'cash back' at the supermarket, buying foreign currency or traveller's cheques and gambling transactions.

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