All-In-One-Guide to Consolidating Credit Cards
Do you feel that you have too many credit cards? This happens to more people than you may think, and it’s usually due to one simple reason: marketing.Due to record spending on credit card marketing, many people have more accounts than they need – many of them carrying balances. If you’ve been considering consolidating your debts, then look no further, as we’ll give you the skinny on what to do with our All-In-One Guide to consolidating your credit card debt.
- Check Your Credit Report. This is the first step to consolidating credit. You need to get a handle on how many accounts you have. Do you know? You probably should.
- Assess Your Spending. If you need to consolidate cards, now is also a good time to make sure you aren’t spending more than you should on things that you may not even need.
- Opt Out of Credit Card Marketing. If you want to explore credit options, that’s fine. But they don’t have to be sent to you via mail. Opt out of all those direct mail ads because you don’t need them.
- Close Dormant Accounts. If your credit report shows accounts that you forgot were open, close them.
- Rank Your Cards. Use a spreadsheet to track all your accounts. Rank them by lowest to highest APR charged on balances.
- Close Accounts with High APR. You don’t need those high APR cards if you’ve got better credit than when you opened them. Get rid of them.
- Close Non-Premium Accounts. Premium credit cards have more cachet and look better in the eyes of financial institutions. If you don’t use your basic accounts, eliminate them.
- Keep Your Oldest Accounts. The best way for financial institutions to judge creditworthiness is by how long you have maintained particular accounts. Try to keep those ones open.
- Explore Balance Transfers. If you've received one of those offers for balance transfer credit cards in the mail, you might consider taking them in order to consolidate accounts. Many card issuers are now offering extended 0% interest rates on cards on BOTH purchases as well as balance transfers.
- Understand Balance Transfer Charges. Sure, consolidation through balance transfers is useful, but remember that a fee between 3-6% of the transaction will be charged.
- Eliminate Balances Altogether. This should be a goal for everyone. The only reason one should keep balances is because they have to for financial reasons.
- Consider a Consolidation Loan. You need to weigh the benefits to transferring balances between credit accounts. Sometimes it’s better to try and apply for a straight-up loan.
- You Really Only Need Two Cards. In addition to credit cards, most people have student loans, car loans or a mortgage on their credit report as well. Thus, you don’t really need twenty credit cards.
Looking for more information on consolidating your debts and balance transfer credit cards? We've provided more articles, tips, advice and resources on consolidating your debt with balance transfer offers below:
- Basics of Balance Transfers - When transferring a card balance, the outstanding debt (balance) owed on the cardholder's old card is transferred to a new card with a lower interest rate, and typically occurs when a customer switches from his existing card to a new offer.
- Maximizing Your Balance Transfer Cards - Balance transfer cards happen to be one of the most appealing aspects of the credit card business for consumers. They allow many people to take advantage of much lower interest rates and less finance charges on outstanding card balances but
- Real Costs of Credit Card Debt - If you live beyond your means with a credit card, having one can easily hurt your financial standing and may even lead to financially devastating credit card debt. If you find yourself in that predicament, a debt consolidation plan might be in order but you should consult your accountant or financial adviser first on this matter. The keys to preventing credit card debt are...
