5 Strategies for Consolidating Credit Card Debt

Millions of Americans continue to experience the slow-motion disaster of credit card debt. The Federal Reserve Bank of New York estimates that Americans had $800 billion in credit card debt as of the third quarter of 2021, with 3.2% of that amount going into significant delinquency. Additionally, it can be challenging to catch up after falling behind on payments due to the sky-high interest rates charged by the credit card industry.

Suppose your endeavors to settle your Visa obligation need to be fixed. In that case, an obligation combination can adjust all your charge cards to one regularly scheduled installment in a perfect world with a lower loan cost. We’ll walk you through the various consolidation strategies to help you choose the best option.

1. A balance transfer credit card is best for people with good credit who can pay off their debt in one to two years. A balance transfer credit card consolidates your existing credit card debt onto one card, which has one main advantage: a low initial interest rate. The majority will offer a 12- to 24-month introductory APR of 0% on balance transfers, giving you more time to pay off your debt without worrying about interest. When transferring large balances, balance transfer cards typically charge a fee of between 3% and 5% for each credit transferred.

Cons Most cards with low or no intro APR charge balance transfer fees between 3% and 5%. This can lead to more debt at a higher APR if the balance is not paid off during the promotional period. Typically, it would help if you had excellent credit to qualify for 0% APR. Some cards offer long introductory periods, up to 24 months.