It doesn't take long to run up a huge credit card balance. Paying it off is another matter.
Because of credit cards' high interest rate levels, much of your monthly payment goes to interest. Minimum payments are higher too, thanks to changes in the law.
Transferring your credit card balance to a card with a lower interest rate may be one way to speed up the payoff time, as long as the card doesn't have other fees that can add to the balance. Selecting the right card for a transfer is important.
The small business information website NextAdvisor.com has introduced a Balance Transfer Calculator, to help consumers find the best offer for their particular situation. The calculator automatically estimates the total finance charges and other fees consumers can expect to pay after transferring existing credit card balances onto popular balance transfer cards.
Thirteen different credit cards were included, from the well known Slate from Chase and Citi Simplicity cards to the Capital One Platinum Prestige and Discover More cards.
The Balance Transfer Calculator is unique because users don't need to manually plug in interest rates, introductory APR time frames or other complicated information. NextAdvisor has already done the work, thoroughly researching each card's terms and conditions and carefully reading through interest charge calculation formulas.
How it works
To use the calculator just enter the amount you plan to transfer, how much you'll be paying towards this balance each month and your current credit standing. The Balance Transfer Calculator will show the best balance transfer cards for the user, estimating the total finance charges and other fees they'll pay and how long it will take to pay off the balance.
"With each card having a different combination of ongoing APR, introductory zero percent APR period, and fees, it's a daunting task for any consumer to determine which credit card they should transfer a balance to in order to save the most money," said Tasha Lockyer, Director of Product Management at NextAdvisor.com.
The calculator, she says, removed the complexity for the consumer, allowing them to enter just three pieces of information to see how much interest and fees they would pay with each card.
Obviously the more you can pay on the balance each month the quicker the balance will fall. Consumers should avoid paying just the minimum payment each month. Rather, they should determine how much they can afford to pay and pay that same amount each and every month.
How they voted
Yes
Yes