Should I Transfer My Credit Card Balance To A 0% Interest Account?
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- Опубліковано 28 вер 2024
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WOW! Interest rates on credit cards were at 6-15% back then... now, they're around 25%-29%.
I'm 32 now and back when I got my first credit card at 20, the interest rates were still around that percentage. You must be an old timer...
@@tired_brickmason34 This video was from 8 years ago, dillweed.
@@tired_brickmason34 You must be a loser
Yes! Been there, done that several times. Dave mentions it's a mental issue we have when getting rid of debt. We learn nothing by consolidating to a lower interest credit card. It might be temporary, but if you haven't changed the way you spend money, you will only be right back where you started several years later and digging an even deeper hole. This has been my experience! Working to change this now! Baby step 2!!
It works......you can borrow your way out of debt.
Yes the behavior is THE MAIN PROBLEM but having a small bone of $1200 in savings is still okay to do if you attack the behavior. For me- my interest was near $3000 on $5500 in debt. Best believe I transferred it to a 21 month no interest card.
Can I ask how your credit score was? If it was low what bank did you go with?
@@ilanarevalo9488 it was Mission Lane I believe. One of those credit cards you get from Credit Karma.
I'm leery to pay it all off. I may keep a small balance, just to remind me not to do it again. How quickly I forget, yet it takes years to pay it off..lol.
Who’s watching in 2020 and believe that he’s still paying for that? After he said to call the credit-card company to know what would be the interested rate after 18 months I was like 🤦🏻♂️ hahaha
Paying off $22k on $75k income is crazy let’s not kid ourselves here
Yeah but gotta check the balance transfer fee It's a % of the balance transfer.
There is a one time cap of 3-5%. Still cheaper than 15% per *month*!.
Yep. About to do it and save a grand!
@@Jhanson-kx6qx It's better, but it's not great. Assuming the fee is 5% of the amount transferred and that he pays it all off over a year in 12 equal payments, in the average month he will owe about half of what he transferred, so overall this would be equivalent to paying around 10% interest annually.
Occasionally you find offers with no balance transfer fee and 0% interest. Those can be useful; just to remember to cut up any card that comes with that deal.
What is "0% interest"? Did he mean "0% interest with 3% balance transfer fee"? (I haven't seen too many 0% interest offers that don't have a balance transfer fee.)
Navy Federal to name one
Do the transfer
I think I'm missing something.... There is a credit card balance of 15% .... Or a temporary loan at 0% (plus a 3-5% fee). Why would you not transfer it, then cut up the card, and call them to reduce the credit limit to the amount transferred? 15% is crazy.
Do you mean.. if someone has a credit card with INTEREST of 15%? Looking at another card offer with an intro rate at 0%? with a balance transfer fee of 3-5%?
You WOULD want to transfer it if the balance on the cards was high, this would save your interest on 10-18 months depending what the offer says. Second DO NOT close the old card account and no need to CUT up your cards! Collect them in a separate safe place for the next 0% offer they send your way! Also you never want to reduce your credit limit, that would drastically increase your UTILIZATION PERCENTAGE in turn drastically reducing your credit score. You may have meant to call them for something else?
I would like to call dave ramsey, but I dont know how. Its kind of important.
+TheTacoSupreme Try a phone.
+TheTacoSupreme
Click on the link in the description that says watch online 24/7. On the left you can click on the link Email Dave and send a message. Or at the top of that page there is the number to call. Good luck.
+TheTacoSupreme Here is all the ways you can contact us. www.daveramsey.com/company/contact-us/
Thank you, I found out earlier. I emailed and left a voice mail.
Him asking what the interest rate will be AFTER the 18 month 0% interest period scares me & makes me think he isn’t serious about getting the debt paid off. The interest rate after 18 months shouldn’t matter because your debt should be paid off way before then, that’s the point of the 0% interest for 18 months transfer. Dave is right, it’s not a math problem it’s a poor spending habit problem.
It matters if you can only transfer part of your debt to the 0% card. You have to focus on the debt that’s accruing interest, and if that means the term runs out on the 0% card, you still saved all that interest on that debt for that period of time, but you can end up with a balance left after the term ends, which you then switch your focus to paying off.
Dave makes a very good point !!
This guys just moving it from one place to another but the debt is still there and the debt needs to be paid off !! Moving it around doesn’t make the balance any less !! Duh 🙄!!
He needs to put money into it !! Duh 🙄!!
Why didn't teamsters in financial debt take out Jimmy hoffa CREDITCARDS???
The interest rate is my problem
Don't borrow money. Follow the mantra people of if you can't pay cash then you cannot afford it!
It appears that the balance transfer fee of 3% - 5% would kill you even if the APR is 0% in 12 months. Am I right?
Some cards have 0% balance transfer fees such as any of the Navy Federal cards, and a 0% promo
@@lukelallier such as....
My transfer fee was 0.09%. I’ve heard that some are 0%.
If you’re paying $200 a month in interest and the 5% balance transfer fee comes out to $500 on 10k transferred, you have come out ahead after 2-3 months where that extra interest not paid has gone towards the principal. The trick is to actually pay everything you can towards the balance instead of feeling complacent like the guy in the video is talking about.
Blew his mind when Dave said you can pay off 22k in a year right?
Can I transfer like a couple thousand at a time on to one card or does it have to he all or nothing? The low interest card has a smaller limit than the higher interest card. I figure I can pay it off within the 18 months if I do it this way.
do not do the interest free its VERY risky.
As long as you're paying your bill every month, virtually every credit card is a 0% interest. Banks like to mask high interest cards with a 0% slogan because they know that people who do balance transfers or apply for these cards have trouble paying every month and they can catch them when they default on the payments.
It's risky if you don't pay it every single month.
False
Ramsey is right here. If you do the transfer you better be super aggressive on paying off the debt as fast as you can and not create any new debt which is always the danger. Change the behavior and kill this enemy called debt. I'm winning now because ive changed my behavior. Thank you Lord for wisdom.
The lord doesn't give you wisdom. You have to learn for yourself. Get out in the world, travel, talk to others who differ from your own socio-economic status, and read books. Stop relying on a god to give you something.
James 1:5 (NIV)
If any of you lacks wisdom, you should ask God, who gives generously to all without finding fault, and it will be given to you.
Yes, it's a crutch but the "living beyond means" and not budgeting is absolutely the real problem keeping the debt and the stress and anxiety spiraling around not making the budget and sticking to it. The actions creating the debt causing more stress than the debt itself I've found, debt is just the consequence.
Thank you for your comment God bless you
@@Jdotrhh🙌🏽🙌🏽🙌🏽
Interest IS the problem!! My interest charge is 450 bucks outta the grand I drop in my card. I transferred balance over to a zero interest card and paid it off in 13 months! How can you say the 450 monthly interest charge is not the issue ?? If I had to pay the interest it woulda took me 10.03 years to pay it off !!!
This might have been an earlier call back when interest rates were better
I love it. “I moved my CC debt to a 0% CC and saved what would have been $1200 in interest over the next year.
With all that hard work behind me, I can take a break from this whole paying off debt thing for awhile. In fact, I think I’m gonna go celebrate my victory at Ruth Chris tonight. And, since I don’t have to worry about some nasty ole interest for the next year, my $400 minimum payments will really start crushing my $22K balance! Debt freedom is just around the corner!”
In my situation, going from an interest card to a 0 % for 21 months for example, that card would be paid off so much faster. Right now I am paying interest and a portion of my card off, and I rather pay the portion than the interest because this damn interest is not doing me any favors right now.
Same. I made the mistake of using my credit card for an emergency room visit when I didn't have insurance. 8000$ later and my payments almost all go to interest and barely any principle. So I looked at a 21 month 0 APR card as well
"The danger is feeling like you did something" so true lol
@cardingmanager....telegram he is the only real vendor
Move the money to the 0% balance card and stick to the plan and pay it off.. and cut up your card.. simple... but move it though..
Stop saying to cut up your cards!! It’s poor advice.
@@davidvictorkocherhans5976 What's a good alternative? (serious)
@@RobbiePfunder Put them in a safe place like a responsible adult and use them in the future when you have the opportunity to use them on a 0% promotion.
Ron.....Simple and absolutely right! When you are SERIOUSLY
motivated to kill your debt. Move the debt balance to a 0% plan, attack it as aggressively as you can...put every penny that you can spare on it and as often as you can! I did this and it worked for me...but I was truly motivated....simply by the peace that I knew it would finally give me in the end. I had, had enough of the mental torment and burden that debt held on me! I am now free....and have complete peace after having sacrificed to get it down! Now...no regrets! I wish this peace to all who under this debt burden...God Bless!
I recently posted how I used $25k in balance transfers to pay down my mortgage. I'm almost done paying them and can't wait to redo the process.
My coworker says for years he kept moving his balance to various cc companies who gave him no interest, he would do so before the interest would be added n save a ton!
Exactly.
Sounds to me like your coworker was always in debt. Not a good thing.
@@markussimmons2386 if your debt is in an ASSET vs a LIABILITY then debt is fantastic
@@davidvictorkocherhans5976 and please explain how debt is an asset
I said if your debt is IN an asset
But you'll feel like you did something at the end when you paid it off if you stuck to the plan. But it's important to never fall back on the same old patterns tho
4 years later and its still relevant today seeking the advice i need. thanks dave and great question Jason im in your position now, move the balance still gazelle
And after another 4, still is 😊
"Don't knick debt, CUT IT!" Very powerful.
One thing to remember is that you might not get approved for the entire amount of your debt. This guy needs to get approved at the start for a $12,000 credit limit.
So you might just end up opening another credit card for nothing.
It it’s a decent amount, it can still help.
@@xxpowwowbluexx In my opinion, if you have good credit, you should try it.
I was in the mid to low 600s when I tried it. I didn't have any missed or late payments, I just had a lot of revolving credit card debt. Roughly $17000 when I started Baby Step 2. I applied for a 12-month 0% interest balance transfer card. I was approved but it was only for $1000.
I went ahead and did the balance transfer but realistically, I didn't save much. I don't remember how much my interest rate was but if it was 20%, I saved about $200 dollars. I would have finished BS2 at the same time with or without the transfer.
What is a decent amount?! Please interpret what @jwalton stated. The guy with the $12,000 credit debt would have to get approved for a $12,000 credit card limit in-order to transfer his $12,000 debt to the new card which has the zero APR balance transfer rate. If the guy gets approved only for about 4K, then it’s like he opened another credit card for nothing… he would only be able to transfer 4K of his 12k debt to the new card but he still will be responsible for paying off the 4K on the new card along with his remaining 8k left of the 12k debt. At the end of the day, he still would have to pay 12k and he just got a new inquiry added to his credit report for opening the new card. I hope that makes sense to you.
So funny $1200 less is less they have to pay on the debt. Also the Zero percent as long as they can pay this off in the zero percent period they would be find. card jumping has got me almost debt free. That was bad advice. Never pay a bank interest if you can avoid it. His snowball effect is great as it has little victories so if you can the interest and continue to double up payments its like a interest free layaway to clear debt. Zero percent credit cards even with the small fee is a game changer to get out of debt. Not all debt is bad and if you move your debt to the better side its always good.
YESSSSSS!!!! Thank you for your comment! sounds like there are only a few people on this planet who understand the credit card game.
Just did this a few minutes ago, thanks for the advice... I'll pay it off in under 18 months...it's only $2800
Pay it off sooner
May I ask what credit card you used to transfer your debt to?
@@poisonxgirl Wellsfargo gave me one with 0% interest for 18 months which enabled me to pay down the debt in those 18months
You have to be careful though some cards have a clause that if you're not paid off after 12-18 months they add a balloon interest charge.
True, usually with store cards like a Home Depot offer.
Excatly
If you can't pay off your debts within the zero interest period, at the very least, get your debt below 30% of your available credit. If you have a balance transfer account available, move your interest charging cards to it and do the math. That
*JESUS CHRIST LOVES YOU AND CARES FOR YOU HAVE A GOOD DAY EVERYONE*
Dave you failed to educate your caller about how a credit card actually works and that it is an instrument granting him access to the credits that are already in his cestui que trust. I've explained this in detail in a video I just uploaded on my channel.
Having a plan is the most important part.
Yes you should. This is obvious.
I would love to see Dave author a book on Family Business Succession Planning.
+OregonCoastGhost Dave would just tell you to not be a wuss and raise your kids right then you won't have any problems with succession cause your kids won't grow up to be spoiled idiots :3
youtube mark Kohler for that
That $1200 a year looking more like $2400 a year now, plus with my $45-50k annual, I think I'm getting a balance transfer 😭
His advice 7 years ago is that 10% of the problem is interest rates. Now given the high credit card interest rates, it increased. Interest rates on credit cards are now 20% of the problem. So do the balance transfer and pay it off before they raise the rates back up.
What if both of my cards are at 29% interest rate and i owe a little over $7,000 would that amount be approved and if so would it be better to transfer to a 0% apr for 18 billing cycles credit card ? And if so would it be more affortable? Im new to all this!
Couldn't get approved for a balance transfer due to a recent loan so the only option is to aggressively pay down the balance. Wish me luck!
He should also check the new credit card's interest rate after the 0% APR period. If he's not as diligent as he's planning to be in paying this off quickly, he may end up consolidating his debt into a credit card with 15-30% interest rate after the promotional period.
Becarefull of discover cards. Unless its prepaid dont use it ever. Or eve. Applie.
In this time Cutting card is not a solution for not using card. We have cards in our phones ..... lol
Dave wants to keep you in debt.
TY for your help and advice, i just did a balance transfer and i am CHANGING MY WAYS! :)
there is always a fee to transfer balances too so its not a magical get out of jail free card. just attack the debt and live within your means!!!!
Any recomendations for a credit card to do a balance transfer for someone with bad credit?
How does how balance transfer's interest work? I understand you are moving money from one account to another usually there is a 3% fee. Most card has a 0% interest only on new purchase not balance transfer and you still do need to pay the minimal payment but what would the interest be? 0% or the term listed when you did the balance transfer?
I’ve done this for years, especially given what interest rates run these days (~30%). The key is what Dave mentioned. You MUST pay this off during the terms of the transfer.
If his only other debt is an $11,000 car loan then his four credit cards are going to be the first thing paid in his debt snowball, so they should all be gone within 6 months and half gone within three, which means that the interest saved will only be about $350. If the 15% card is one of the earliest ones paid the interest saved will be even smaller. Not worth the hassle just start wailing on them.
Robert Smithers want help on how to payoff your credit card debt through credit transfer contact darknight hack on 5093811954
is it worth it if i do a balnce transfer with a bill of 2800 on one card and 5500 on another? both have pretty high interest rates
It’s always worth it to have zero interest. But you have to be aggressively paying the cards down, not just the minimum balance
Great advice 😅😅😅😅😅❤
Talking numbers, you should do this
I think Dave shifted his advice over the years to avoid consolidating debt because it disrupts the debt snowball. That is because the debt snowball relies on small debts being settled quickly to increase motivation
ramsey stop judging people yes people get into debt. later people realize what they did and are seeking solutions not someone to put them more down then what they are. just get to the point without judging
I assumed everyone was being attacked after watching this 😂 especially Jason. He was the target, not the interest.
Bitconneeeeeeeeeeeeeect!
What you are doing operating a motorized vehicle without pay attention to your surroundings, is not only dangerous but is teaching others its ok to sit in or on a 5000 lb heap of plastic steel and possibly blood and guts.....So do not let me see you do that any longer sir. Shalom🕎
Great advise 👏
Thanks so much
Very good advice
Cut the other cards so u dont start using them again. I am a creature of habit and that blue card is my go to.. lol
A 0 interest balance transfer is indeed helpful but I absolutely agree that the danger is in getting "comfortable" and not paying off the new card either.
Wealthy individuals recycling asset debts like (refinancing mortgages, etc) among other assets for taxes and growth is a totally different story, credit card debts are usually living beyond means or having sudden emergencies, fair enough - regardless of the case, it's the lack of financial strategy that is the primary issue if the debt is hurting your finances and assets. The credit card isn't generally tied to an asset that is growing way way beyond the value of the debt when one is having to make payments and doesn't have a single sell off option of an associated asset with profit beyond the debt and interest - though it is possible a card could have been used carefully for an asset that grew rapidly and payments kept interest at bay (financial strategy was strong and fanatical from the start though).
what if your are not eligible for a zero percent offer? what do you do when the cc companies wont offer your any less apr other than 24%.
Love Dave's "tough on debt" takes!!
Does doing a Credit Balance Transfer result in closed accounts for the credit card being transferred?
No it will not be closed. Leave your card open even if you have 0 balance. It will be good for your credit.
Is it true if you do a balance transfer, the card that gets zero out balance age of the account restarts over? Plus it lowers your credit score?
Totally false
balance transfer fee is a killer
Most balance transfers charge like 4% so you're not saving $1,200 you're saving closer to $700. Still not horrible, but not 0%
The chase care 0% for 18 months has no such fee
most of my offers are either zero BT fee or 3%. and still better than 15-18%
double message
you sir is telling the truth ....... " the danger things here IS THAT YOU FELL LIKE YOU DID SOMETHING " but the end of the day you still own and need to pay it off...
Actually there’s a lot the Dave Ramsey is not telling you it’s because it’s not part of his teachings in his books does he can’t speak about it. The reality is I doing balance transfers you decrease your utilization percentage which can drastically raise your credit score, you can also aggressively pay down your cards by paying principal only with zero interest.
@@davidvictorkocherhans5976 Exactly!
Just subscribed
heck yeah!! saves mad moneg
He will only save $1200 if he paid it of after one year in one big payment, if he pays it off gradually he'll save $600 since his average debt will be half
I never will understand how such an intelligent man like Dave can trash credit cards the way he does for every single case. I mean I understand credit cards can be like cheetahs and they can attack you in groups take their prey down. So general population has to be gazelle intense to avoid them because gazelles have no business being anywhere near cheetahs. But my dad is the hunter you send to slaughter those cheetahs. And he has trained us the same. Yet I bet he will still say its not wise to use them. Makes no sense.
I think he treats it as, if you pay off everything, and it works for you... so be it! do so!
But he hates the hundreds of calls that come in every month because people owe credit card debt.
When you use your credit card, typically it takes 24-72 hours before the card company will even let you pay it. If some "emergency" happens in that 72 hours and you forget to pay it, or haven't signed up for it to be paid in full every month, they now have you for more than you spent!
Those small incidents, over time, keep credit cards in business. That's why Dave would rather wash his hands of the situation and be able to say "you wouldn't owe this, had you not used it!"
Veerendra Jadhav most people don't have the discipline brother. It's a wide view at the whole system, it's a bell curve analysis.
I have 2 cash back credit cards. One 2% on everything and one with 3% on gas and 2% on groceries with an additional bonus added for using that bank. I pay them in full every month, to be honest i usually get online and pay them off every time i make a purchase. on average I earn between $50-85 per month in cash back just for paying my bills and making my normal purchases on credit cards as opposed to cash or a debit card. Now I really need you to explain to me how earning cash every month and paying absolutely zero interest on a monthly basis is not wise and why you feel i should not do it.
I am in your same situation because i myself use credit cards and pay them off in full every month, so i agree that there is nothing wrong with cash back. The problem is that statistically since you earn cash back you are more likely to justify spending more in some purchases like food or items you think you need but actually won't use. This also boils down to the fact that people who use credit cards do not budget. I feel like if you budget yourself and use credit cards it should be fine.
He chooses not to show moderation because that would hurt his audience who has a lot of debt. Kind of like Alcoholics Anonymous, there is not middle ground. Just a little sip will lead you to drinking a whole bunch more!
$1200 dollar saving if you balance transfer, minus fees, it's not worth it!
Its worth it. Some cc don't charge a transfer fee. I did a transfer last year. Because I didn't transfer one card within their time limit I had to pay the transfer fee but that was nothing compared to paying $1800 of interest one year. I made sure I was ready to pay it off.
It is emphatically worth it! There are benefits all around IF you are going to oay off the debt.Saving $1200 is one. Rebalancing your debt is another. Raising your FICO score is another.
why would it not be worth it?????