Balance transfer credit cards are tempting. They offer a person a chance to transfer the balance off other credit cards, to this credit card, which usually offers perks like low interest rates, or even incentives for transferring a balance. However, a person should be completely educated before making the choice to go with a balance transfer credit card because they may end up in worse shape than they started in.

One of the reasons a person considers a balance transfer credit card is that they wish to consolidate all their credit card debt onto one card. This makes paying down the balance easier and can also reduce monthly payment amounts. However, when people do this they may actually end up paying more. The reason for this is that even though these cards often offer no or low interest initially, it will eventually go up. So a person has to understand that they are combining all their debt into a large sum that once interest rates go back up, will cost them a huge amount of money.

The way to beat this problem is for a person to make sure they have paid down a significant amount of the balance before the interest rates go back up. It is also important that a person makes payments on time, so they do not add to their balance. Staying on top of payments and setting a plan to pay off the debt is the best way to ensure that a balance transfer credit card does the person good rather than harm. Balance transfer credit cards are great for a person who has a plan to pay off their debt. Instead of dealing with multiple credit cards, with multiple interest rates, payment dates and fees, a person is dealing with one company.