How a Balance Transfer Can Help Pay Off Credit Card Debt Faster | Guiding You Forward

In this episode of the Guiding You Forward video podcast, we discuss Visa^® balance transfers—what they are and how they can reduce your credit card debt. We’re talking with our resident expert, Matt Farrow, assistant vice president of payment and deposit products at Mountain America Credit Union. 

In this episode, you’ll learn: 

• Why a balance transfer can be an easy way to reduce credit card debt.

• How the interest rate you sign up for may change.

• Other featured benefits of a balance transfer offer.

If you’ve ever researched how to pay off debt, you’ve probably heard of a balance transfer. What is it? As the name indicates, it’s simply where you take the balance from an existing credit card and transfer it to a card from another financial institution.

How can a balance transfer help reduce my credit card debt?

Ahh—the question of the day! Well, a balance transfer can be a great way to put you in a better debt position. How do you best leverage these benefits?

It really comes down to rate—your primary goal is to look for a credit card that has a lower interest rate than the one you have now. That way, when you transfer the balance over, more of your payment is going toward your actual balance instead of interest.

What is rate shopping?

Before you take the first offer you see in your mailbox, take the time to shop around and see what a variety of credit unions and banks are offering. Then, compare and choose the best option for you.

Matt also talks about how to sort through confusing offers—like if a card has a low introductory interest rate but then that rate balloons after the introductory period is over. Be sure you know what that new interest rate is and when it will go up.

What about fees and other surprises?

This is where a balance transfer can go off the rails. Matt offers other specifics you should be aware of before signing on the dotted line.

The bottom line is to do your research (and the math!) to ensure you’re aware of all the terms and conditions of the offer you select. This way, you can stay focused on paying off credit card debt faster!