How to stop paying interest on your credit card debt
Sick of paying interest on a lingering credit card debt? You’re not alone.
A recent ASIC report has revealed that Aussies have transferred a whopping $12.4 billion of credit card debt using balance transfer offers over the last five years. But of those cardholders who used a balance transfer offer, almost 1 in 3 actually wound up in more debt than before.
“When you take up a balance transfer offer, you can have as long as 26 months interest free, which can be just the breathing space you need to clear that debt - as long as you use it wisely,” says Mozo Director Kirsty Lamont.
So if you’re thinking of ditching credit card interest for a while using a balance transfer offer, it’s important to firstly find the right offer for you, and secondly, have a plan in place to clear your lingering balance within the interest free period.
Check out some of our editors’ top balance transfer picks below, then read on for some tips on blasting your lingering debt.
Citi - Rewards
- 0% interest for 26 months (2.5% BT fee)
- $49 annual fee in the first year ($149 after)
- 20.99% purchase rate
Think you’ll struggle to clear your debt in a shorter time frame? No worries! The Citi Platinum balance transfer offer has you covered, with 26 months interest free to blast your lingering balance.
Bankwest - Breeze Platinum Mastercard
- 0% interest for 13 months
- $99 annual fee
- 0% purchase rate for 13 months (12.99% after)
The Bankwest Breeze Mastercard is super budget-friendly, with 0% interest on transferred balance for a little over a year. Plus, this one’s a Mozo Experts Choice Best Value Platinum Travel Credit Card and Best Low Rate Platinum Credit Card winner.
NAB - Low Fee Platinum Card
For cardholders who prefer to stick with a big bank, the NAB Low Fee Platinum card comes with a leisurely two years interest free to help you get a handle on your debt. It also comes with premium perks like extended warranty and price protection.
Woolworths - Everyday Platinum Credit Card
- 0% interest for 14 months
- $0 in the first year ($49 after)
- 19.99% purchase rate
The Woolworths Everyday Platinum comes with 14 months interest free, and no fee for transferring a balance. And with no annual fee to worry about in the first year, you’ll be free to focus on smashing your debt!
Want to compare more balance transfer card options? Head over to our comparison table for more.
How to clear your credit card debt with a balance transfer
- Choose a realistic balance transfer offer. Getting the right interest free period on your balance transfer card is key to successfully wiping away your debt. If you have a large balance or can only afford small repayments, choosing a longer balance transfer offer will give you more time to pay off your lingering debt.
- Crunch the numbers on your repayments. Use our handy calculator to crunch the numbers on how long it will take you to pay off your credit card debt with monthly repayments you can afford. Then you’ll know how long the balance transfer period has to be to work for you.
- Prioritise paying off your debt. Whether you give up going out to eat for a while or resist buying those concert tickets, try to find extra money wherever you can to put toward paying off your debt as soon as possible. Make those payments a priority until you’re happily debt free.
- Set up automatic transfers. If your budget is pretty steady, you can set up automatic monthly payments onto your balance transfer card. That way, you can rest easy knowing that by the time the interest free period runs out, you’ll be free and clear of debt.
^See information about the Mozo Experts Choice Credit Card Awards
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