Credit Card Debt Management

So I’ve gotten a lot of offers for balance transfer cards lately. How did they know? This is something I have considered for a couple months.

I normally tear up any new credit card offers that arrive in the mail because I’m not mean-spirited enough to stuff all the incompleted materials into the pre-paid envelope and mail it back to the company.

However, upon noticing that the interest rate on both my cards is at 20 percent, the first logical question was, “Holy moley, how did that happen? I always paid on time, those *(#&$!!”

The next question: “Why not consolidate to a no-interest credit card?”

Well, I’ll give you three reasons:
1) The standard 3% transfer fee is discouraging, considering my high balances.

2) I’m not convinced a no-interest balance transfer card is the best option.

3) I don’t want to have a greater history of card-jumping than already exists on my credit record.

I have been down the balance transfer road before, and all it got me was another credit card with about four times as much debt. In my defense, I was young and stupid. We were all young and stupid at one time and did things we regret.

Those are learning experiences so we don’t wind up old and stupid. Like almost everyone else, I have different behavior patterns and much better self-control now that I’m older and (hopefully) wiser.

So here is my new plan of attack for these high-interest credit cards:
1) Call existing credit card companies and ask for a lower interest rate. Many have said a simple phone call can generate surprising results.

2) If still unsatisfied, transfer the balances to a card offering 0% intro APR for 15 months with a low fixed rate thereafter like the Advanta Platinum MasterCard. This card, for businesses only, was recommended by Smart Money magazine. The card’s 3% balance transfer fee maxes out at $50, which is pretty unusual. Some may be better off finding a low fixed-rate card with no balance transfer fee.

Here are some questions I have considered when mulling over the balance transfer issue, and please feel free to add your own thoughts to the mix:
1) How high is the balance transfer fee?
2) What are the minimum and maximum transfer fees?
3) How high is the annual fee?
4) What are the standard interest rates on balance transfers and new purchases?
5) If a zero- or low-APR introductory offer is included, how long does it last?
6) How high is the interest rate thereafter on the remaining balance?

Business Wire recently reported that new research by Auriemma Consulting Group shows the vast majority of credit card holders – 85% to be exact – are choosing not to transfer their balances. The top reason given was satisfaction with current interest rates.

Well, clearly that’s not me.

So, you may ask, why have I been considering ditching the high interest for a couple months and still no action?

Elementary, my dear Watson! I am a stubborn procrastinator. But maybe I’ll just make that phone call today … or tomorrow. After all, money doesn’t grow on trees. Stay tuned for the success I will hopefully be able to report sooner rather than later.