Credit Card Balance Transfer Strategy to Eliminate Debt Faster

2. Only use this strategy when the numbers work in your favor

A balance transfer is most useful when your current interest rate is high and you need more than a few months to clear the debt. If you can pay your balance off very quickly, the transfer fee may wipe out most of the benefit. NerdWallet notes that if you can clear the debt in about three months or sooner, the fee may cancel out the savings.

This is why the first step should be a simple comparison. Look at four numbers: how much you owe, your current interest rate, the transfer fee, and the length of the new card’s promotional period. Then ask one question: “Can I realistically clear this balance before the 0% period ends?” If the answer is yes, the transfer may save you money. If the answer is no, the strategy may still help, but only if the remaining balance after the offer ends will be much smaller than what you have now.

For many people, the best balance transfer is not the one with the longest headline offer. It is the one that gives enough time to finish the debt at a reasonable monthly payment after including the fee. A longer offer with a fee can still beat a shorter no-fee offer, but not always. The right choice depends on your payoff speed.