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I have a credit card that is just about maxed out. I'm trying to get into financial health but the purchase interest charges are killing me and it's hard to get ahead. My cash flow is also terrible right now. Would I benefit from trying to transfer to a 0% card for a while? Does my credit have to be good to do so?

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    Welcome to Money.SE. Unfortunately you won't be getting any credit card recommendations here as that is considered off-topic. – Michael Jul 25 '17 at 20:13
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    Have you stopped spending on the card? – quid Jul 25 '17 at 20:13
  • Possible duplicate of money.stackexchange.com/questions/82079/… – 0xFEE1DEAD Jul 25 '17 at 20:15
  • I've edited the question to remove the portion which is off-topic [references to a specific card / recommendations for a specific card]. The rest of your question is good for the site, and hopefully my edit still maintains the spirit of your main question. – Grade 'Eh' Bacon Jul 26 '17 at 14:46
  • Without budgeting [tracking your income and expenses, and using that tracking to stay within your means], transferring debt between cards will only help you a small amount. If you are exceeding your available credit it may be a sign that you are spending more than you earn, and that you need to reduce your spending or earn more. There are a lot of questions on this site about budgeting - here's one example of many: money.stackexchange.com/questions/44347/… – Grade 'Eh' Bacon Jul 26 '17 at 14:51
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My concern is that just moving the balance will make you feel like you've accomplished something, when you really haven't. Sure you'll save on interest but that just reduces the rate at which you're bleeding and doesn't heal the wound. It's entirely likely that you'll feel freed by the reduced balance on the original card, ignore the transferred balance since you aren't paying any interest on it, and soon you'll have two cards that are maxed out.

I would instead look at getting your expenses under control. Make sure you have the start of an emergency fund - 1-2k depending on your family situation. If you are single start with 1k; if you have kids bump it up to 2k or maybe a little more just to avoid charging any expenses. Get on a written budget, and don't spend any money in the next month that is not accounted for. Then you can figure out how much you can afford to put towards the credit card. That will also tell you how much interest you're going to pay.

The only way I would recommend the balance transfer is if the interest savings (after the balance transfer fee) reduced the time it takes to pay off the card by two or more months (since one month isn't going to make a big difference interest-wise), and you immediately cancelled the original card, and cut up both cards (including the new one), making payments by mail or online.

Other than that, the interest saved after the balance transfer fee probably isn't worth the risk of being in a worse situation on the other side.

  • Thank you for your input. Moving the balance will only be a minute step towards accomplishment. I always pay my bills on time and have cut all unnecessary spending. Sometimes it's hard but very rewarding to pay down debt. – Britr8 Jul 26 '17 at 21:17
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There are a number of ways to get out of debt. First, stop spending on that card. You could apply for a 0% APR credit card and if you qualify with a credit limit equal (or higher) than what you have now, then you could transfer the balance and start on paying that down. You could also work out a payment plan with Chase - they would rather have some of the money vs. none of it. But you need to reach out sooner rather than later to avoid having it sent to collections.

Since your cash flow is terrible, you could also pick up a second or third part time job - deliver pizzas, work at the mall, whatever, to help increase your cash flow and use that money to pay down your debts.

The Federal Trade Commission has some resources on how to cope with debt.

  • All spending has stopped and I pay the bill on time each month I just figured I may be able to save more by transferring to a lower interest card. I just picked up a second job and am looking into a third. I truly do believe in working your hardest to get where you want/need to be. Thank you! – Britr8 Jul 26 '17 at 21:21
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This is pretty simple in theory, harder to do in practice.

  1. Stop borrowing. Cut up all credit cards, you can even close the accounts while there is a balance. This should answer the question about 0% transfer (no). Interest rate is not your problem.
  2. Stop spending. No entertainment, no eating out, minimum clothing maintenance, turn off cable, anything you can do to cut spending.
  3. Work like an insane person. Get an extra job or three, whatever you can do to earn money.
  4. Throw all extra money at the debt.

You will be surprised how quickly the debt will disappear. Doing these things will work, I know from experience.

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As far as I agree to everyone saying that "you should stop borrowing" & etc, I see a lot of sense of getting balance transfer cards if you are actually paying it off.

Considering a scenario, you have a CC with balance of $5000 on each at roughly ~24% interest which results in ~$1200 interest per year. Your minimum due is ~$110, where you are paying $100 / mo for only interest and ~$10 / mo to cover your balance.

If minimum is all you can pay with your current cash flow - yes, pleease do a balance transfer.

Assuming your transfer cost is 3% and 0% interest for 21 months ( as many CCs do now ) your cost will be $150, but paying off $110 / month for 21 months you will pay off roughly $2000 off your balance, instead of ~$210 if you were paying only your minimum due. After 21 months - you'll have a balance of ~$3000 ( instead of $4800 ) and then you can repeat.

If your cash flow gets better - please make as many more / bigger payments any time you can to reduce the balance and you'll pay off sooner.

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