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We’ve all been tempted by 0% credit card interest rate offers. These offers are usually for short periods of three to 12 months and there are usually conditions attached. For example, the preferential rate may apply to balance transfers, but not to cash withdrawals. The low interest rate may not apply to credit card cheques or purchases either.

People who are carrying a large debt will want to make the most of 0% interest rate offers. Here’s how to keep your credit card interest rate at 0%.

Researching 0% Credit Card Deals

First of all, it is best to research the credit card thoroughly. Consumers need to find out:
- what period the 0% interest rate is for
- whether it is for balance transfers only
- whether it applies to other spending on the card
- what the rate is for cash withdrawals or credit card cheques
- whether there is a balance transfer fee
- what other incentives there are for using the card

Answering these questions will help consumers to decide which 0% credit card is right for them. It is especially important to pay attention to the period that the incentive offer lasts for. To keep paying 0% interest, consumers will need to apply for a new 0% credit card a month to six weeks before the old offer runs out. This leaves time to get the card, activate it and transfer the balance without incurring any additional fees from the current credit card company.

Rate Surfing Benefits

Moving from card to card, or rate surfing, is a common way of keeping interest rates low and paying off as much of a debt as possible. Using a 0% card means that any money paid is reducing the outstanding debt rather than paying interest. This is good news for consumers’ long term financial stability.

Of course, there’s no guarantee that consumers will be able to get another card. This will depend on their credit profile. The best way to maintain a good credit profile is to have some credit card debt (but not too much) and to make all payments on time. This will show credit card companies that you are a good credit risk.

Watch Out For Balance Transfer Fees

Credit card companies do not like credit card tarts, another term for rate surfers, because they lose hundreds of thousands of pounds’ worth of income that they would normally gain from interest. As a result, many credit card companies take their money up front by charging a balance transfer fee of around 2% of the balance transferred. Even with this fee, savvy consumers should be able to shop around for the best rates and pay much less interest than they would normally have done.

In addition to the incentive of a 0% interest rate, consumers can also benefit from other rewards. These include points that can be used for travel, earning vouchers, cash back and charitable contributions. This means that consumers can reduce their outstanding debt and gain a reward as well.

UK consumers have staggering levels of debt. Consumer borrowing has grown by more than 50% in five years. It’s no wonder that people are looking for new ways to ease the debt burden. Credit card jumping offers one possible solution.

Money Saving Device

People who are carrying large amounts of debt can save hundreds of pounds in interest simply by taking advantage of the latest credit card balance transfer deals. Many of these offer a 0% interest rate for a fixed period, such as three, six, nine or even 12 months.

As well as transferring balances from other credit cards to a 0% credit card, consumers are sometimes able to transfer balances from store cards and even outstanding loan amounts. It is worth checking to see if these transactions also benefit from the 0% balance transfer rate.

Transferring a balance to a 0% credit card means that any payments made are paying off the principal rather than the interest. This reduces the amount owed, which is good news for those using this as a debt management method. Many card issuers do charge a balance transfer fee to curb the practice of credit card jumping, so it is worth looking around for the best deal.

Getting The Best From Credit Card Jumping

To get the best from 0% credit cards, many savvy consumers move from card to card when the preferential rate period expires. This requires some organization, but credit card jumping can mean that debt balances continue to go down as consumers move money (or rather, debt) from card to card. Those who don’t move their debt at the right time often find they are paying a much higher interest rate and the debt is not being cleared. This strategy works best when consumers pay on time. Late payment can result in fees that increase consumers’ level of debt.

Consumers who are using many credit cards to manage their debt should consider creating standing orders to manage payments automatically. It is also worth using a spreadsheet or calendar program to keep track of when it is time to move to the next credit card.

Other Incentives

Credit card jumping can be an effective way of reducing debt, providing consumers do not add any new debt. There are also other incentives for using 0% cards, such as charitable contributions, rewards points, air miles, travel insurance and much more. It is worth shopping around to get a reward as well as the interest-saving rate.

Summary

Credit card jumping can be a good strategy for people who are:
1. organized about managing debt
2. trying to clear a large debt
3. prepared to shop around for the best balance transfer deals
4. able to pay on time consistently so as not to damage their credit rating.