4 ‘golden rules’ to kicking your Christmas credit card debt with a balance transfer

woman christmas shopping with credit card

Is your Christmas spending dragging you down like a ball and chain as you say goodbye to holidays? Well, it’s back to reality which means it’s time to kick your debt out of your life! 

And that’s where a balance transfer credit card could be your golden ticket. 

Right now in the Mozo database over 35 credit card providers offer one or more balance transfer offers. A balance transfer is where customers can transfer their current credit card debt over to a new card and pay it off at a lower interest rate or completely interest-free. 

The catch is, these offers don’t last forever. Some offers have terms that are a few months while others can be a few years, it all depends on what suits you and your debt. 

So with that in mind, there are some golden rules to follow when it comes to choosing the right balance transfer for your Christmas debt. Read on and find out how to find the right offer to help you wipe your credit card balance clean this year … 

Golden rule no.1: Choose the term length 

Balance transfer offers come in all shapes and sizes. In fact, right now in the Mozo database balance transfer terms range from five months all the way up to 36 months. 

So when it comes to choosing the right balance transfer period for you, consider how long you think it’ll take to pay down your credit card debt. Determine how long you can afford to pay each month and then your total balance by that monthly amount. 

For example, say you have $4,000 debt. If you can afford to put $400 towards your debt each month you’ll need about a year. Simply divide $4,000 by $400 and you get 10, which means you should opt for a balance transfer of at least 10 months. So, you may want to choose a card with a 12 month offer to give yourself a two-month buffer in case unexpected expenses come up.   

Golden rule no.2: Dodge as many fees as you can 

The truth is, while a bunch of balance transfer offers come with a 0% interest rate, there are some fees to be mindful of. 

First off, remember you may be charged an annual fee attached on your new balance transfer credit card. Keep in mind this can sometimes be hundreds of dollars upfront and will be charged each year you hold the card. 

Similarly, another cost to watch out for is a balance transfer fee. According to the Mozo database, these fees range from 0% to 2% and can often be added to the balance of the new card on top of what you already owe. So say you have $4,000 debt to transfer, if you were charged 1.5% your balance transfer fee would be $60. This would mean the balance on your new card would sit at $4,060 to start off with.

Also keep an eye out for other costs like ongoing monthly fees that may be attached to your new card. If you are forking out too much in these sorts of charges chances are you aren’t getting a good deal. 

Golden rule no.3: Make repayments as often as possible  

Despite being ‘golden rule no.3’ making consistent and frequent repayments should be a top priority when it comes to paying off your Christmas debt. Ensure you always make at least your minimum repayment amount each month (to avoid late fees) but it’s also important that you pay more so that you clear your debt before your balance transfer period is up. 

If you can put extra money towards your debt, after receiving something like a bonus or raise, do it! In saying that, while the sooner you clear your debt the better, make sure that the  additional contributions you make towards your credit card balance is within your monthly budget and don’t leave you without any spare cash for the essentials.

Golden rule no.4: Don’t spend during your balance transfer period 

Remember the idea of a balance transfer is to pay off your Christmas debt, not to add to it. So over your balance transfer offer period don’t make any purchases on the card. 

It’s also important to keep in mind that any new transactions on a balance transfer card won’t be interest-free. Often new purchases accrue interest immediately and can be charged at the higher cash advance rate rather than the card’s purchase rate … sometimes more than 20%! 

Ready to compare balance transfer offers right now? Check out the table below or head over to our balance transfer comparison page for more options …

Compare balance transfer credit cards - rates updated daily

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  • placeholder
    NAB Low Rate Card - Balance Transfer Offer

    Spend with confidence with a low 13.49% p.a. variable purchase rate and 0% p.a. interest on balance transfers for the first 28 months (T&Cs apply). 2% balance transfer fee applies. There’s also up to 55 interest free days on purchases to help you manage your budget better when you make minimum repayments. Minimum credit limit $1,000. No annual fee for the first year (usually $59).

    Balance transfer rate
    Purchase rate
    Annual fee
    Rewards program
    Estimated savings
    0% p.a. for 28 months and then 21.74% p.a. (2.00% balance transfer fee)
    13.49% p.a.
    $59 $0 in the first year
    -
    Details
  • Apply By 30 April 2024
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    Citi Premier

    120,000 bonus points when you spend $4,000 within 90 days from card approval. Complimentary features like travel insurance and concierge.

    Balance transfer rate
    Purchase rate
    Annual fee
    Rewards program
    Estimated savings
    0% p.a. for 6 months and then 22.24% p.a.
    21.49% p.a.
    $300 $150 in the subsequent years if you spend $48,000 on eligible purchases or cash advances in previous year., $150 in the first year
    Citi Rewards Program
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    Bank of Queensland Blue Visa Credit Card

    Balance transfer rate
    Purchase rate
    Annual fee
    Rewards program
    Estimated savings
    0% p.a. for 9 months and then 21.74% p.a.
    0% p.a. for 9 months then 20.74% p.a.
    $60
    Q Rewards
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    Virgin Money Virgin Australia Velocity Flyer Card - Balance Transfer Offer

    Get in the air with a $129 Virgin Australia Gift Voucher each year. 0% p.a. for 28 months on balance transfers.

    Balance transfer rate
    Purchase rate
    Annual fee
    Rewards program
    Estimated savings
    0% p.a. for 24 months and then 20.99% p.a.
    20.74% p.a.
    $129 $0 in the first year
    Velocity Frequent Flyer
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    Bankwest More Classic Mastercard

    Earn 1.5 More Rewards points per $1 spent on eligible purchases. Plus, if you meet the minimum annual spend, you'll receive a bonus 19,500 points every year.

    Balance transfer rate
    Purchase rate
    Annual fee
    Rewards program
    Estimated savings
    0% p.a. for 6 months and then 19.99% p.a. (1.00% balance transfer fee)
    19.99% p.a.
    $100
    Bankwest More Rewards

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