If you need a break from paying your credit card bills, 0 balance transfer credit cards offers could be for you. The gist of a 0 balance transfer credit card offer, also known as a transfer interest-free credit card is you pay 0 percent interest on the credit card balance you transfer for a stipulated duration, usually anywhere from 3 to 15 months.

Just like any money management technique or investment, a 0 balance transfer credit card offer has both advantages and disadvantages.

Click Here to Apply to Numerous 0 Balance Transfer Credit Card Offers

Advantages of getting a 0 balance transfer credit card:

• Save money in the long run. The 0 balance transfer provides an excellent opportunity to cut interest costs on existing credit cards, especially if you’re able to pay balances off during the 0 percent transfer period.
• Protect your credit record if you’re in a cash crunch and can’t make present credit card payments.
• Convenience – consolidating all credit card bills into a single payment results in fewer deadlines to observe and less time spent paying bills.
• Access to more cash – transfering your credit card balance frees up credit in the event you need funds – say for a business start up.
• Make money using other people’s money. If you are willing to take the time, you can continually take advantage of 0 transfer credit card balance offers so that your interest rate remains at 0 on the long run. Effectively you are then borrowing free money. You can then invest that free money.
• If you transfer your balance to a credit card with a dividends offer or air miles or some other reward system, you capitalize on those rewards. Check out the terms to see if and when the credit card rewards kick in.
• Speed: you can be approved very quickly. It’s relatively little hassle for what could be numerous financial advantages.

Click Here to Apply to Numerous 0 Balance Transfer Credit Card Offers

Disadvantages of taking a transfer interest free credit card offer

• Lose money – the interest rate at the end of the interest free credit card period may jump up and exceed your present interest rates (i.e. the rates before you transferred your credit card balance). What you hoped would save you money could, if not well-managed, cost you more in the long run.
• You may spend more than you planned. Transferring your balance will gain you available credit on your present cards which you may use up resulting in more debt than you intended.

Pitfalls to watch out for with 0 percent balance transfers

• Transfer fees: you may get dinged with flat rate fees and/or a fee amounting to a percentage of your credit card transfer balance.
• The end of your interest free credit card period. This is a biggie because your interest rate will undoubtedly jump significantly on the balance remaining.
• With most 0 transfer credit card offers, the zero interest applies only to the balance you transferred; not to new purchases. Therefore, even if you buy something within the interest free period, the stipulated interest rate will apply to that purchase.
• Again, with most interest free credit card offers, any cash advances after the balance transfer will incur interest charges. In other words, the 0 percent interest applies only to the balance transfer; not future purchases and/or cash advances.
• When the interest free credit card period ends, and if you have a balance remaining, most cards will apply all payments to the lowest rate balances first.

Click Here to Apply to Numerous 0 Balance Transfer Credit Card Offers

At the end of the day, if you’re able to pay off most or all of a 0 balance transfer credit card balance offer, you can save a significant amount of money over 3 to 15 months, depending on the duration of the 0 percent interest period. If you foresee your financial situation improving, but need an interest free credit card period to gain a financial foothold, then taking advantage of 0 balance transfer credit cards offers can be a good financial management move for you and your family.

Which 0 balance transfer credit card for you depends on your objective.  Once you know your objective, then you can choose and apply for the best card for you.

Considerations when looking for a 0 balance transfer credit card

1.  Interest free duration

Determine how long you’d like to have an interest free period.  The range among these types of credit cards varies widely, from 3 months to up to 15 months.  If you wish to delay interest accrual for as long as possible, then apply for then the best 0 balance transfer credit card for you is one that delays interest accrual on transferred balances for 15 months.

2.  Transfer fees

The downside to these types of credit cards is that you pay an up front transfer fee, often 3% on the balance you transfer.  This amount can add up.  For example, if you transfer $5,000, your transfer fee at 3% will be $150.  Therefore, you need to calculate whether not having to pay interest on your balance for the interest free period will save you more money than the transfer fee.

Using the $5,000 balance transfer example, if you cannot pay down that balance and interest continues to accrue at 10% per month (a low interest rate) for 12 months, the interest you would pay would be approximately $500.  Therefore, clearly in this example, the transfer fee is well worth getting a 0 balance transfer credit card.

3.  Annual fees

Fortunately, most balance transfer credit cards do not have an annual fee.  Therefore, unless the perks of a card with an annual fee are fantastic, the best 0 balance transfer credit card doesn’t have an annual fee.

4.  Interest rate (APR) after 0 interest period

Don’t ignore the stated interest rate (APR) when choosing the best 0 balance transfer credit card.  The range in interest rates is huge.  Yes, I know you don’t pay interest for a stated duration; however, at the end of the interest free period, any outstanding balance will accrue interest at the stated APR.  Often 0 balance transfer credit cards have a higher APR than other credit cards (there’s always a catch).

Moreover, if you make purchases with your new 0 balance transfer credit card, you’ll start accruing interest on those purchases immediately.

Important:  be sure to check the APR for cash advances.  Cash advances often have a higher APR attached.

If a low APR is most important to you, then consider getting a low interest rate credit card.

5.  Late payment charges

It’s important that you’re always aware of the late payment charges for any credit card you get.  The same applies to 0 balance transfer credit cards.  Late payment charges can be hefty.

6.  Assess your ability to pay off the balance during the 0 interest free period

The best way to use a 0 balance transfer credit card is to pay off the transferred balance during the interest free period.  Before applying for this type of credit card, assess carefully your ability to pay off the balance during the interest free period.

I’ve used 0 balance transfer credit cards in the past with great success and saved a great deal of money doing so.  However, it’s easy for the strategy to go awry.   The best 0 balance transfer credit card is a personal finance tool that can help you improve your financial situation … when used right and when you get the right 0 balance transfer credit card for you and your situation.

For example, consider having 4 cards, each with a $6,000 credit limit.  That’s a $24,000 line of credit you could borrow in no time.  A 1 month luxury trip to Hawaii could rack up those types of charges.

But, then you’re faced paying down $24,000 in debt with high interest rate attached.

As far as I was concerned, one card with a $6,000 credit limit was and is sufficient for me.

Not having a second credit card could be embarrassing

Imagine taking your folks or friends out for dinner.  You make it clear you’re paying.  At the end of the meal your card is declined.  You look like a financially irresponsible person.  It’s not a good scene.  If you have an extra credit card, sure, it doesn’t look good, but at least you can pay the meal with your second card.

My recent credit card fraud protection incident made it clear to me that there sometimes credit cards are denied for reasons other than not making payments or spending the full credit limit.

I don’t use cash much; instead I rely on credit cards.  If a card is declined for whatever reason, having a second or third card is handy and can get you out of a jam.

3 reasons to have more than 1 credit card

1. It’s handy to have in case the other card is declined for whatever reason (fraud, limit reached, technical difficulties).
2. You get a second card for a strategic purpose.  One strategic purpose is stopping interest accrual if you have a hefty balance.  The way you can stop interest accrual for a set amount of time (usually up to 12 or 15 months) is getting a 0 balance transfer credit card.  I’ve done this for strategic purposes more than once in my adult life and it worked great (I’m a huge believer in 0 balance transfer credit cards).
3. You find a credit card with outstanding rewards such as frequent flyer rewards, hotel rewards, gas rewards (gas rewards are good given the high price of gas these days).

1 reason not to get a second or subsequent credit card

To get more credit because your existing credit card limit is maxed out.

If you have one credit card that isn’t maxed out and is used responsibly, then consider getting a second card because you never know when your sole card may be declined for any reason.

Naturally, it didn’t take long for Capital One to expand its credit card line into other types of cards including the Capital One 0 balance transfer credit card.

The Capital One 0 balance transfer credit card is a top pick by this credit card site (at the time this post was published).

Pros of the Capital One 0 balance transfer credit card

Fairly long 0 percent interest period

Presently, you don’t pay interest on balance transfers to January 2013 (15 months).  Please keep in mind this post was published in November 2011, so be sure to check to see whether the 0 percent balance transfer period is extended.  I highly suspect it will be.

Essentially, it’s a 14 or 15 month 0 percent interest balance transfer period.

No Annual Fee

Most decent 0 balance transfer credit cards don’t charge an annual fee.  The Capital One card doesn’t either.  Unless the perks are amazing, there’s no need to get a zero balance transfer credit card requiring an annual fee payment.

Interest Rate (APR) at end of 0 percent balance transfer period

Capital One built its reputation on lower APRs.  It’s no exception with their 0 balance transfer credit card.  The APR at the end of the interest free period is 10.9% to 18.9% which is lower than many other similar credit cards.

Note that you’ll find that 0 balance transfer credit card APR is higher than many other cards.  The fact is the selling feature is the 0 percent interest period on balance transfers.  You know that credit cards will make sure they get paid in the long run, and with these types of credit cards, they have higher APRs to make up for the interest free period.

This is why it’s smart to pay off your balance transfers before the interest free period ends.  Also, going forward, don’t accrue a balance on these types of credit cards because you’ll pay more in interest, even with the lower APR Capital One card.  Besides, whenever possible, avoid  accruing balances on credit cards because the mounting interest charges can be staggering.

If you anticipate carrying a balance in the long term, consider applying for a low interest credit card.

Custom Design

If approved for this credit card, you can create your own design with your own picture (this is kind of cool and not offered by every card).

Customer service

I’ve been a long-time Capital One user and have always been very pleased with their customer service.

Cons to the Capital One 0 balance transfer credit card

Excellent credit required

You need excellent credit in order to be approved.  If you don’t have excellent credit, you will have to look for another credit card such as a credit card for people with bad credit.  Of course this type of credit card doesn’t solve your situation of an existing high balance on which you wish to stave off interest payments for some time.

High cash advance APR

The cash advance APR is 24.9%.  This is high, but most credit cards charge a high APR for cash advances.

Transfer fee

The Capital One 0 balance transfer credit card has a 3% transfer fee.  This means your transfer fee is 3% of the balance you transfer.  This can add up on large balance transfers.  Therefore, before tansferring a balance, calculate that you will indeed save more money on interest charges than you will pay for the transfer fee.

Click here for general information about 0 balance transfer credit cards.

Click here to compare 0 balance transfer credit cards.

Please note that the information in this Capital One 0 balance transfer credit card review may change at any time (i.e. APR, interest free duration, etc.)

The worst part is if you’re declined repeatedly due to no or bad credit, you’re in a catch 22.  You need to improve your credit with credit, but you can’t get credit because of bad or no credit.  What can you do?

The simplest thing to do is to seek out credit cards for bad credit or credit cards for people with no credit.

You may be required to provide a cash security deposit with a credit card for a specified duration and as long as you make timely payments for the specified duration the cash security deposit may be no longer required in the future.  If this is required to get a credit card and it’s your only way of getting credit to improve your credit, then it may be the right thing for you to do.

Choosing credit cards for bad credit or no credit

You will want to look at the terms of these credit cards very carefully, especially the:

• Interest rate (APR)
• Any annual fee
• Late payment penalties (which you really want to avoid if you’re working on improving your credit)

Obviously you want the credit card with the lowest APR, preferably no annual fee, and reasonable late payment penalties.

Getting your new credit card

If you have bad credit or no credit, it’s important to use your new credit card to establish a credit-use history.  However, it’s imperative you pay on time every month.  Ideally you’ll pay off the balance each month so you don’t end up in a situation with a sky-rocketing balance that can get to the point where you can’t pay it off.

Don’t take a credit card application decline personally

You may apply for a credit card because it offers unique features that you want or need to help your personal financial situation.  An example of this is applying for a 0 balance transfer credit card.  A 0 balance transfer credit card can be an extremely useful tool for improving your financial situation by stopping accruing interest for many months so that you can catch up and pay off the balance.

However, most 0 balance transfer credit cards require that you have excellent credit and so you may not be approved.

Other credit cards that have unique features and benefits are credit cards with rewards.  The variety of rewards varies greatly these days and often choosing one credit card over another is based on the rewards offered.

Use any credit card responsibly

If you have bad credit and you simply don’t trust yourself with another credit card, then it may best at this point not to get another card, even if you won’t suffer a credit card application denial.

The right reason to use a 0 balance transfer credit card is to buy yourself time to get funds together to pay off existing credit card balances without incurring more debt in the form of interest.

This type of card is the best when you expect and are quite certain you’ll be able to pay off the transferred balance within the 0 percent interest period.

Discover offers a decent 0 percent balance transfer credit card.  Although it has some disadvantages, which I set out below.

Pros of the Discover 0 Balance Transfer Credit Card

1.  15 month 0 interest period

Discover’s 0 percent balance transfer credit card is a good balance transfer credit card because the period during which you pay non interest is a whopping 15 months.  15 months is about as long of a zero interest period as you’ll find with 0 percent balance transfer credit cards.

2.  No annual fees

I don’t like credit cards with an annual fee and avoid them unless the perks are amazing.  Frankly, this credit card doesn’t warrant an annual fee, and fortunately there is no annual fee.

3.  Choose your design

When you apply here for the Discover 0 percent balance transfer credit card, you can choose from a number of designs.

4.  Cashback bonus

You can take advantage of a cashback bonus with this credit card.  The cashback percent ranges from .25% to 5%.

5.  Application process is simple

The online application form is short and simple.  However, simple doesn’t mean you’re easily accepted.

6.  3% balance transfer fee

This isn’t really a pro, but it’s not a con either.  3% is a standard balance transfer fee.

7.  Discover is well-known

Discover is a widely accepted and a well-recognized credit card.

Cons of the Discover 0 Balance Transfer Credit Card

1.  The interest rate when 0 percent period expires

The main downside to the Discover 0 balance transfer credit card is the interest rate.  If you don’t pay off the balance within the 0 percent interest period, you’ll pay 11.99 to 20.99 variable interest rates on the balance until it’s paid off.

2.  Interest on new purchases

Moreover, you’ll pay that percent on new purchases you make with this credit card (you want to avoid new purchases if possible until you pay off the transferred balance).

3.  Cash advance is a hefty 23.99% APR

You certainly don’t want to get a cash advance with this card.  If you do, you’ll pay a hefty 23.99% APR.

Click here to apply for the Discover 0 balance transfer credit card.

Or, read about 0 balance transfer credit cards generally.

Please note that the terms of this credit card may change at any time.  The above facts and features of this card as as of the publishing of this post.

I pulled into the gas station I use each week to fill up.  Fill up, check my oil, go into the store to pay.

The cashier tells me my credit card isn’t working.  That’s strange.  I know I paid the bill last month.  Anyway, I don’t like to make a big deal about it; I hand over another card.  It works and I’m on my way home to enjoy pizza and a movie on Friday night.

Within 2 minutes of leaving the gas station, my cell phone rings.  I answer it and it’s the credit card company calling me about some unusual activity.  I told him that my card was declined minutes.  He tells me that they suspected fraud on my card.  I said I was just trying to buy some gas.

He apologizes (excellent customer service), but asks whether I was trying to spend $810 at Walmart in North Carolina (I don’t live anywhere near North Carolina).  I said “No, I’m not anywhere near North Carolina.”

He tells me they flagged the North Carolina purchase as fraud and that’s why my card isn’t working.  He also said that my card should be cancelled and a new one issued.  I readily agreed.

I was impressed.

I’m a trusting sort of guy and when credit card companies tell me they offer fraud protection, I don’t really think about it … but when they actually pull through, I was really impressed and grateful.

I tend not to think or worry much (at all actually) about being a victim of credit card fraud.  I buy plenty of stuff online without any thought to credit card fraud happening to me.

Anyway, in my limited credit card fraud experience, credit card fraud protection worked.  I’m not saying you’ll have the same successful outcome I did; however, as far as I’m concerned it works.

In fact, my wife, even more recently had a fraud scenario happen to her as well.  The credit card caught the fraud, shut down the card, notified her, and is issuing a new card.  That’s 2 for 2 which is fantastic.

10 Reasons to get a credit card are

1.  Convenient for purchasing products and services

This is probably the number 1 reason to get a credit card.  These days you can buy pretty much everything with a credit card.

I find using a credit card much more convenient than using cash.  Credit cards make it easy to track my monthly expenses, plus I enjoy various credit card rewards.

2.  Build credit

Once upon a time I applied for a credit card and was denied because I had no credit.  Of course I couldn’t help but think “how am I supposed to get credit if you won’t give me a credit card?”  Anyway, eventually I obtained a credit card and was on my way to building a great credit score.

Now, fortunately, there are credit cards for people with no credit.

3.  Fix bad credit

If you have bad credit, one way to fix it is to get a credit card for people with bad credit.  Then, be sure to pay off the balance each month.  In time, using the credit card each month plus paying it off will help fix your credit.

4.  Credit cards as an operating line of credit

I use my credit card for my household as an operating line of credit.  It makes household expenses month-to-month easy and convenient.

5.  Rent stuff

Often you need a credit card to rent or lease stuff such as a car.  Without a credit card, renting vehicles and equipment is almost impossible.

6.  Recurring purchases

There are some purchases that require a credit card, or make your purchase convenient, and that is recurring purchases such as gym memberships.

7.  Rewards

Credit card companies offer all kinds of rewards credit cards.  One of my favorite types of rewards credit cards are cash rebate cards.  However, you can get credit cards with all kinds of rewards such as hotel rewards, frequent flyer cards, gasoline rewards cards, etc.

8.  Track monthly expenses

I like tracking my monthly expenses easily with my credit card statements.  I only use 3 cards and so it’s easy to view 99 percent of my monthly expenses on 3 statements.  It’s great for budgeting purposes.  I can also see quickly where I’m wasting money or spending too much money (those dinners out add up quickly).

9.  Online shopping

It’s difficult buying goods and services online without a credit card.  Yes, there’s Paypal, but not every vendor or online store offers Paypal as a purchasing option (many do though).

10.  Defer mounting interest charges

What on earth am I talking about here?  How can one defer mounting interest charges by getting a credit card?  Actually, it’s easy with 0 balance transfer credit cards.

That all said, getting a credit card is not worth all the benefits if you get yourself into debt trouble.  Please use any credit card you get responsibly.

In fact, I pay for almost everything with my credit cards… but I pay off the balance at the end of each month (most months).

Lately I’ve been writing a fair amount about how, why, and where to get credit cards.  Today I thought I’d write about reasons NOT to get a credit card.

Here it goes… 11 reasons NOT to get a credit card.

1. So you can quit your job.
2. Because you’ve maxed out your other cards.
3. Because you’re offered one, two or ten.
4. To buy stocks and bonds.
5. For any investment where the ROI is less than the credit card interest rate (APR).
6. To finance a vehicle … any vehicle including a Ferrari.
7. To finance you children’s post-secondary education.
8. To pay for a long, expensive vacation.
9. To pay for a home renovation.
10. To fund retirement.
11. To fund your parents’ retirement.

In a nutshell, you don’t want base your decision for getting a credit card to finance purchases that you know will take a long time to pay off such as home renovations, education, and of course your retirement.

Moreover, credit card interest rates are so high that to think of using a credit card to access funds for investments is not that wise.  There are no investments I know that are guaranteed to provide an ROI higher than credit card interest rates.

What about 0 balance transfer credit cards you might ask?  Couldn’t you free up credit on existing credit cards to make investments and/or buy big ticket purchases?

You can.  You can do anything you like.  However, using credit cards regardless of the amount of available credit you have for purchases that you KNOW will take a long time to pay off or you’re risking in the hopes of making more money simply are not sound personal finance decisions and certainly not a good use of credit cards.

If you’re wondering then, what are good reasons to get a credit card, I set out 10 reasons to get a credit card here.

• Operating lines of credit for payroll;
• Expansion and infrastructure (i.e. capital investment);
• Survival debt.

The first 2 types of debt are healthy for a company.  Survival debt, on the other hand is often not healthy because a business is simply using debt to get out of a dire situation.   I’m not saying taking on debt for survival is always a bad decision; however, it’s indicative there’s a problem with the business.

Consumer debt should be used like businesses use debt

Like business debt, consumers like you can use debt to improve your financial situation.  Likewise, using debt for survival can be a sticky situation, but sometimes necessary.

Healthy consumer debt

Probably the healthiest form of consumer debt is a mortgage, but not always if you pay too much for a home and/or you can’t probably service the payments.

Another good use of debt is using it to improve your credit rating.  You can do this by taking on modest debt loads and repaying it promptly.

And yet another healthy use of consumer debt is using a credit card for your monthly expenses, but paying it off each month.  I run most of my household expenses on a credit card (a cash back card).  Doing this is convenient, I get cash back, and all my expenses are conveniently itemized on a credit card statement.

Which brings me to the most important point about consumer debt, and that is your ability to pay it off.

When you borrow money, you pay interest.  The longer the balance is outstanding, the more interest you pay.  It’s easy to take on too much debt and before you know it, you cannot make your monthly payments.

What you need to know when taking on debt:

• Have a firm understanding of the exact amount you must pay each month;
• Know how long you will have to make payments on the debt (i.e. the ammortization period);
• Know whether the payments will increase at any time in the future;
• Understand if there are penalties for late payments and if so, how much those penalties are.
• Have a firm understanding of your income and expenses before taking on any debt so you can be sure you can make prompt payments.

Is credit card debt good?

I liken credit card debt to a business’ operating line of credit.  This is how I use credit cards.  Usually I pay them off each month, but sometimes I’ll carry a balance for a month or two.  When I carry a balance, I do so knowing I will pay it off shortly.  I also then stop purchases so I don’t add to the balance.  Increasing credit card balances is a slippery slope.

The reason I like credit cards for covering many of my monthly expenses is it’s extremely convenient to use for purchases.  I don’t have to carry cash and all my expenses are itemized on the credit card.  The best part is I don’t pay interest as long as I pay off the balance each month.  It’s an interest-free loan for a few weeks as long as I pay off the balance.

I also like some credit cards that offer great benefits such as cash back, rewards, etc.  These can be generate some decent financial benefits as well.  However, if you let your balances accrue each month, the benefits gained will be outweighed by the additional expenses incurred.

Credit card debt becomes bad when it’s used to buy items and services that you have no way of paying off in the near future.  One time I let my credit card balance balloon to a fairly high amount and then I looked at the interest I was paying.  It was outrageous.  Fortunately, I was able to pay it off quickly and from that point on I simply pay off balances each month.

What if your credit card balance is too high right now?

One way to get some temporary relief is to apply for a 0 balance transfer credit card which will transfer existing balances to a new card on which you don’t pay interest for a stipulated time such ass 3 to 12 months.  During the interest-free time period, you can work on paying down the balance without incurring additional debt via interest.

However, one caution with 0 balance transfer credit cards is not to incur more debt with that 0 balance transfer credit card because interest will accrue on new expenses.  The interest-free benefit applies only to transferred balances.