Credit card debt is a big problem for many in this country — including New York residents. People rely on their credit cards to pay bills, for consumer spending or to pay off medical debt. On average, an American with a credit card holds a balance of at least $6,700. However, many people have much more than that. In fact, balances are particularly high this time of year after holiday spending. Some reports claim that Americans charged as much as $37 billion during the fourth quarter — which included the holiday spending.
Many New York residents may be looking for ways to reduce their credit card debt after those holiday bills started to arrive. For many the answer is a balance transfer. Balance transfers allow a person to transfer a credit card balance to a new card at a lower introductory interest rate in order to save some money. After some time this rate will increase. These incentives were not popular prior to the Great Recession, but have made a comeback recently.
Experts say that balance transfers can be a good way for people to pay down credit card debt this year. However, people should be careful to do their research to make sure they are getting a good deal. Experts suggest using an online credit card calculators to see the available offers and make a smart choice. They also say people should make sure they understand what the interest rate will be following the introductory rate. Finally, experts warn people not to use balance transfers as a way to increase spending.
In some situations, a balance transfer is not going to help people pay down their credit card debt. If people are struggling, they should know that legal options are available that can offer a fresh financial start.
Source: New York Post, “Balance transfers gain new footing,” Catherine Curan, Jan. 18, 2014