Balance Transfers Ahead of the Holidays

Tuesday, September 22, 2020
   
girl using credit card shopping during the holidays

The holidays are inevitable. They’ll come regardless of what happens with the COVID-19 pandemic or political events, and—as usual—they’ll prove to be the most expensive time of year. Securing a good financial outlook in advance can help you enjoy a happier holiday season and a softer financial landing in 2021. 

Because let’s be honest: this year has been tough. You may be among the many who suddenly find themselves with unforeseen expenses. When browsing your options for debt management, balance transfers are among some of the most versatile and useful options that will let you manage existing, anticipated and unanticipated debt.

The Benefits of the Balance Transfer Credit Card

A balance transfer credit card is exactly what it sounds like. It’s a credit card that lets you not only buy products and services but also pay off or consolidate balances from other, higher-interest credit cards by moving the debt to another account. You can reduce your interest rate—sometimes to as little as zero—and pay down your principal more rapidly.

For example, 2020 and the ongoing pandemic interfered with household cash flow for many. These people had little choice but to raid emergency funds—or try to preserve them—so necessities like car or home repairs, appliance replacements, tuition or even groceries had to go on a credit card.

While annual percentage rates have remained around 16 percent, that interest is not negligible. Moreover, if the average is 16 percent, that means many people are paying an interest rate that’s higher. Even if your interest rate drops, that drop typically applies only to new purchases. The old purchases continue to accrue interest at the old rate.

Transferring a debt of $1,000, $2,000 or more, for example, makes it a new debt—one that may be eligible for an introductory rate of as little as zero percent interest for a year. Reducing 16 percent interest on that amount of debt could be a smart move that could save you hundreds of dollars in interest and put your money toward paying down your debt’s principal.

No Debt? Balance Transfer Cards Are Still a Necessity

A credit card with a balance transfer option is a handy resource to have even if you aren’t currently struggling with debt or cash flow. You may not need to transfer a balance right now, but you may find yourself wishing for access to this feature in the future.

Circumstances can change rapidly—especially in the uncertainty of our current times. Even a temporary financial blip can result in months of payments and prolonged financial recovery. Likewise, even when you know that you have a large expense coming, managing cash flow in the meantime can prove challenging.

Having an option that would let you put a large, unanticipated (or anticipated) expense on an account that would give you months, a year or even longer to pay it off at zero percent interest gives you time to pay for what you actually bought and only what you actually bought—with no additional expense. It’s like paying cash without having to have the cash upfront. Plus, you might even earn rewards for your spending!

The Balance Transfer Credit Card at La Capitol Federal Credit Union

Having a credit card that provides the financial flexibility and security you need to make your life and finances work for you is essential in these times. At La Capitol Federal Credit Union, we recognize just how important that is before the holidays, during the holidays and beyond.

Our Cash Back Visa Signature, Rewards Visa, and Prime Plus Visa cards include a balance transfer feature that gives you zero-percent interest for 12 months on transfers made within 90 days of opening your account.* Having a balance transfer option on your credit card offers a financial cushion that you can use now—or keep as a backup. It’s all up to you, but you’ll have the security of knowing it’s available if and when you need it.

If you’re interested in learning more about how to make a balance transfer credit card work for your financial situation, reach out to us here at La Cap. See what we have to offer, and find the credit card that’s right for you.

 

* Cash Back Visa Signature:  APR = Annual Percentage Rate. The introductory APR on purchases is 0.00% for twelve months for purchases made in the first 90 days after account opening. The introductory APR on balance transfers is 0.00% for twelve months for balance transfers made in the first 90 days after account opening. Purchases and balance transfers made after the introductory rate periods will be charged at the non-introductory rate. The introductory rate does not apply to cash advances or similar cash transactions. The introductory rate will end twelve months from account opening. Your rate for purchases, balance transfers and unpaid balances after the introductory period will be adjusted to the non-introductory rates, based on your creditworthiness. Existing La Capitol credit card balances or loan accounts are excluded from this 0.00% balance transfer offer. Membership eligibility required. Visit lacapfcu.org for full membership eligibility requirements.
Rewards Visa and Prime Plus Visa: APR = Annual Percentage Rate. Our Prime Plus Visa has the lowest rate of any credit card we offer. The introductory APR on purchases is 1.99% for twelve months for purchases made in the first 90 days after account opening. The introductory APR on balance transfers is 0.00% for twelve months for balance transfers made in the first 90 days after account opening. Purchases and balance transfers made after the introductory rate periods will be charged at the non-introductory rate. The introductory rate does not apply to cash advances. The introductory rate will end twelve months from account opening. Your rate for purchases, balance transfers and unpaid balances after the introductory period will be adjusted to the non-introductory rates, based on your creditworthiness. Existing La Capitol credit card balances or loan accounts are excluded from this 0.00% balance transfer offer. Membership eligibility required. Visit lacapfcu.org for full membership eligibility requirements.