Can You Reall Benefit With Credit Card Debt Consolidation?

By: Paul McDermott

Credit card debt consolidation seems to be the most talked-about term in the world of credit cards. It's true that credit cards have been very useful and convenient for us and we, in fact, treat credit cards as a necessity.

Anyone who has read any newspaper articles on credit card debt would already know what credit card debt consolidation is. However, just for the benefit of others, credit card debt consolidation, in simple terms, is the process of consolidating debt which you hold on various high APR credit cards onto just one low APR credit card.

Again, you must use your card correctly, but if you do, and you get a good rate, then this can be beneficial for you in your effort to get rid of your credit card debt for good. Here are some things to look for in getting the best deal.

Initial APR: As mentioned above, lower APR is the biggest benefit from credit card debt consolidation. Since consolidation is used by credit card suppliers as a tool to attract consumers, they generally offer a 0% APR for a initial period of 6-9 months of you signing up with their credit card.

Standard APR: If you have a lot of debt, then you will probably still have a balance after the initial low rate. Be careful not to take a deal that has a 0% initial rate but then a standard rate that is too high.

0% on Purchases: Try not to get excited about this. Your goal is to get your debt paid off remember? So you should not be looking to go on a shopping spree. But if you did have an emergency purchase that you absolutely needed, this might be a way to get it.

Easy Management: Having one bill and one balance will help you keep track of your debt payoff progress.

Other Benefits: These are not as important, but you might get rebates, discounts or reward points depending on the type of card you get. Don't let this be crucial, but just an additional plus if you get it. You might even ask for something like this. Sometimes the phone rep holds things back and adds them if that will close the deal.

So once you get your old balances paid off, hopefully you have cut up those cards, because once these balances are zero, that is when the real test begins. Are you going to dig yourself a mucher deeper debt hole by using these cards again or are you finally committed to ridding yourself of credit card debt for good. If you are going to get rid of it, then a credit card debt consolidation can be a big help in achieving your goal.

Article Source: http://yourfinance.co.za

About The Author
Author Paul McDermott reveals more about his experience with consolidating credit card debt and other personal finance lessons, some learned the hard way, at Credit Card Debt.
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