If you have a credit card, you may have considered taking advantage of the deals promoted by the credit card companies at some time. Even if you haven't looked at the market until now, it may be a good time to re-examine your options. With an increasingly competitive market, you never know when a card that is ideal for your needs will appear. Currently, there are 67 million cards in circulation in the UK, and our appetite for the credit card lifestyle shows no signs of abating. So it is no surprise that new cards offering better deals crop up so often.
There are two types of 0% credit card offers with 0% on cash purchases and 0% on balance transfers. Many cards are now offering both of these services, but there are restrictions. The length of time that the 0% offer period lasts varies depending on the provider. If you have an existing balance on a card then it may be worth looking at the 0% balance transfer option so that you can transfer your balance and reduce your interest payments. If you want to make one-off cash purchases and pay the total amount back over a number of months, then the 0% cash purchases option will be more attractive.
In 2006 ?133.2 billion was spent on credit cards in the UK and this amount keeps rising every year. If you are one of the many people who spend regularly on credit cards, and haven't kept up with the payments quite as well as you had hoped, then you will be able to see how this type of card can help you financially. It gives you a chance to halt interest charges completely and pay off your debt, rather than just paying off a small amount of the original balance and a large amount in interest payments each month. If you are one of the people barely making your minimum payments each month, this could make a big difference to your finances.
The 0% on cash purchases card is completely different. This type of 0% credit card allows you to make purchases on the card without any interest being added to that amount for a specific period. Although these offer periods are shorter than the 0% transfer cards, it is still a reasonable length of time. Currently the average interest-free offer is around 3 months.
By understanding how the two 0% credit card offers actually work, you should be able to work out how to combine the two offers. It is possible to get a 0% cash purchase card, buy something relatively expensive, pay some of it off, and then transfer the remaining balance onto a 0% balance transfer card and then pay off the outstanding amount. For example, you could purchase something for ?3000 and pay it off over 15 months at just over ?200 a month, remembering to take into account the transfer fee. Managing your credit like this does takes a lot of planning, though.
Both types of 0% offers change frequently, as they are amongst the most popular credit card deals available. By taking into account all the advantages of using 0% card offers, you should have some idea of how you can make these cards work most effectively for you. Once you have a feel for these types of card, you can theoretically make interest vanish for a very long time. However, you do need to consider if card hopping could affect your credit rating and keep in mind that regular transferring is become harder to do as the industry begins to wise up.