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New Visitor
rrrddd
Posts: 2
Registered: ‎05-16-2009
0

Finally got a 0% balance transfer card. Now what?

So I FINALLY got a 0% balance transfer card but now I don't know what my best action plan should be.  The credit limit is only $3500 and the 0% is good until Feb 2010 with a 3% transfer fee.   Here is what I'm dealing with:

  • Amx - $2,000 balance - 19.24% - Min Pmt $40/mo
  • Target - $3,800 balance - 17.24% - Min Pmt - $92/mo
  • Macy's - $700 balance - 24.9% - Min Pmt $20/mo
  • Express - $600 balance - 17.76% - Min Pmt $40/mo
  • Personal Loan - $3.450 balance - 9.9% - Mthly Pmt $175

 

If I had a big enough credit line obviously I would transfer everything to reduce the interest but since I don't I'm  not certain what my best plan of action is.  Advice?

Established Contributor
Susyquk
Posts: 504
Registered: ‎03-27-2009
0

Re: Finally got a 0% balance transfer card. Now what?


rrrddd wrote:

So I FINALLY got a 0% balance transfer card but now I don't know what my best action plan should be.  The credit limit is only $3500 and the 0% is good until Feb 2010 with a 3% transfer fee.   Here is what I'm dealing with:

  • Amx - $2,000 balance - 19.24% - Min Pmt $40/mo
  • Target - $3,800 balance - 17.24% - Min Pmt - $92/mo
  • Macy's - $700 balance - 24.9% - Min Pmt $20/mo
  • Express - $600 balance - 17.76% - Min Pmt $40/mo
  • Personal Loan - $3.450 balance - 9.9% - Mthly Pmt $175

 

If I had a big enough credit line obviously I would transfer everything to reduce the interest but since I don't I'm  not certain what my best plan of action is.  Advice?


Personally...

 

I would do the $700 from macys, $600 from Express, $2000 from Amex and then just take $200 from your Target.

 

It gets rid of balances on 3 of your highest rate cards (and will bring your number of cards carrying balances down by the most possible).  You've already checked through the back door number that you can't increase that CL I take it?

New Visitor
rrrddd
Posts: 2
Registered: ‎05-16-2009
0

Re: Finally got a 0% balance transfer card. Now what?

Haven't tried that yet.  Haven't heard if anyone has had luck with this.  Maybe I'll try.
Senior Contributor
txjohn
Posts: 4,214
Registered: ‎09-12-2008

Re: Finally got a 0% balance transfer card. Now what?


rrrddd wrote:

So I FINALLY got a 0% balance transfer card but now I don't know what my best action plan should be.  The credit limit is only $3500 and the 0% is good until Feb 2010 with a 3% transfer fee.   Here is what I'm dealing with:

  • Amx - $2,000 balance - 19.24% - Min Pmt $40/mo
  • Target - $3,800 balance - 17.24% - Min Pmt - $92/mo
  • Macy's - $700 balance - 24.9% - Min Pmt $20/mo
  • Express - $600 balance - 17.76% - Min Pmt $40/mo
  • Personal Loan - $3.450 balance - 9.9% - Mthly Pmt $175

 

If I had a big enough credit line obviously I would transfer everything to reduce the interest but since I don't I'm  not certain what my best plan of action is.  Advice?


 

What will your rate be when the intro 0% is up in Feb 2010?  Essentially if your transfer now, you get 9 months at 3%, not 0%.  Then you pay on the remaining balance at your non-intro rate.

 

I agree with susy that you should transfer:

 

1.  $2,000  AMEX @ 19.24%

2.  $   700 Macy's @ 24.9%

3,  $   600 Express @ 17.76%

 

I DO NOT agree that you should transfer $200 from Target.  This will max your card, then put you over limit when the 3% fee is charged.  If you go over limit, you will lose the intro 0% rate.  3% of $3300 is $99.  Your balance will be, after BT, $3,399.  This is as close as you want to come to your limit.

 

Now you have exchanged 3 existing balances to 1 new balance.  This will help you with reduced utilization (your new CL is added to your total while your debt remains constant).  It also helps you by reducing the number of accounts with a balance.

 

You need to spend the next 9 months in KILL THE DEBT mode.

 

1.  Create a written budget.  Identify all income and all expenses.

2.  Kill all non-essential spending.  No eating out, no movies, no impulse buys. 

3.  Buy generic and store brands for food and personal care.  This will on average save you at least 20% on these type of expenses.

4.  Adjust your AC thermostat up a few degrees (going to feel a bit warmer in the house) and the heating down a few degrees (may need a sweater at night).  This will save at least 10% on your current utilities.

5.  Sell stuff.  The stuff you don't use, don't want, don't even rememeber stored in the garage, closet, under the bed or in paid storage.  Sell stuff that you don't need or is a luxury you really can do without.  Have a garage sale, ebay sale, craigslist sale.

6.   Consider getting another part-time job for the next 6 to 9 months.  An extra $300 to $800 per month will let you get completely out of debt during your 0% period.

7.  Don't accumulate any new debt. 

 

These are ideas that can help you maximize your short 9 month 0% (really 3%) intro rate.  Good luck and happy hunting (kill the debt hunt) :smileyhappy:

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