Use Credit Cards as Part of Your Debt Payment Strategy

by Kay Lynn

Many credit cards have such high interest rates that it may seem like not much progress is being made on the balance.  One of my goals when paying off debt was to complete it as fast as possible.

I transferred one of my higher credit card balances to a new card with a 0% interest rate for a set period.  I had to pay a transfer fee but even with that cost included, I saved hundreds of dollars by the time the balance was paid.

This strategy aided in my success in paying off all credit card balances in January. I wish I knew about this card without transfer fees which would have saved even more! This promotion is no longer available but you can still pay zero interest for 18 months.

Balance Transfer Card


As long as you don’t add new credit card debt, using offers such as the Discover More card mentioned above can be part of of your strategy for debt elimination.  I only wish I had the zero balance transfer fee offer when I needed it! 

Note: There are affiliate links in this post.

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krantcents February 28, 2011 at 9:08 am

Great idea! The only danger is if you do not pay it off by the end of the 0% period.

Lisa @ Cents To Save February 28, 2011 at 9:13 am

I tried to consolidate two credit cards, but was not approved for the total amount. I decided against it. It would be too difficult to keep up with another credit card payment.

Kay Lynn March 4, 2011 at 6:06 am

@Krantcents – Thanks for pointing this out. I was able to pay off the balance before the 0% interest ended. Even if you couldn’t though, it would make sense to calculate if it would be cheaper to stay with the current credit card or moving it to the no-balance fee transfer card.

Molly@No Credit Check Loans March 1, 2011 at 5:14 am

Well, credit card debt is a serious burden for anyone’s personal finances, especially in today’s economic climate. There is no easy button for paying down debt. It is a gradual process that takes time. But with the right discipline and determination you can make a little money go a long way toward becoming debt-free. If you decide to use balance transfers as a part of your debt repayment strategy, make sure you factor in the up-front fee. Most of the time credit card issuers will charge 3%-4% of the amount being transferred and that fee will also accrue interest.

Adam Gottlieb March 1, 2011 at 7:51 am

Hi Kay Lynn,

As a couple of the commentors pointed out, transfering debt to a zero interest card can be a great way of saving money, but only if the person can be very disciplined and can knock out the debt before the promotional period ends.

There is another option I want to point out: for those who still have decent credit, you might want to try to get a peer-to-peer loan at Lending Club or If your credit is good then the interest rates will be lower than your card and you can typically borrow up to $25,000 over five years without the bank.



Aspiring Millionaire March 1, 2011 at 11:37 am

If used properly interest free cards can be a great way to repay debt. You can often find deals with no or very low interest, free transfer and no fees if you look around.

Thanks. 🙂

Mr. Broke Professional March 1, 2011 at 6:49 pm

My only worry is that people who have credit card balances in the first place may, in some instances, lack the self-discipline to take full advantage. That said, if you know you can then this is a very nice method. I wish I could put all my student loans on a 0% credit card and then keep switching them year after year to new 0% credit cards, lol.

First Gen American March 4, 2011 at 12:45 am

Wow. I didn’t know the 0% offers were back. Good to know. Thanks.

Carmen October 28, 2011 at 11:17 am

Won’t you get a “hit” on your credit report by closing the initial credit card? (I am assuming you closed it, otherwise there might be a temptation to use it!)

Debbie R January 29, 2012 at 9:07 pm

Interesting article. It seems like the banks are so against any type of approval these days. I didn’t know card companies still made these types of offers.

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