The content on this page is accurate as of the posting date; however, some of the offers mentioned may have expired.

Dealing with credit card debt can be a daunting task, and you might be considering a balance transfer as a way to handle it. But, are balance transfers worth it? It's important to understand all aspects before you make a move.

We'll explain the pros and cons of balance transfers to give you a clear perspective on whether this strategy can improve your financial health or if there are potential pitfalls you should be aware of. With this analysis, you’ll be able to make an informed decision.

  • Balance transfers can provide significant interest savings and simplify debt management, but it's important to understand the potential fees and risks involved.
  • Choosing the right balance transfer card requires considering multiple factors beyond just the introductory APR, including the standard APR, balance transfer fees, credit limit and additional benefits.
  • Before proceeding with a balance transfer, consider your financial situation and debt goals, keeping in mind that while it can be beneficial, it demands discipline to prevent additional debt.

Pros and Cons of Balance Transfers

Before you decide to go for a balance transfer, it's crucial to understand both its potential benefits and drawbacks so you can have a good idea about what this financial strategy entails.

Pros of Balance Transfers

  • Potential for Lower Interest Rates: The best thing about moving your debt from one card to another is that you might get a lower interest rate. Many balance transfer cards come with an offer of 0% interest rate at the start. If the interest on your current credit card is high, transferring the balance to a card with a lower rate can save you a significant amount of money over time.
  • Consolidation of Debts: Balance transfers allow you to consolidate multiple credit card debts into one place. This can simplify your debt management, as you only have to worry about making one payment each month.
  • Opportunity for Credit Score Improvement: If managed correctly, balance transfers can lead to credit score improvement. By keeping your use low and making timely payments on your new card, you're demonstrating responsible credit behavior, which can positively affect your credit score.

Cons of Balance Transfers

  • Balance Transfer Fees: Most credit cards charge a fee for balance transfers, typically between 3% to 5% of the transferred amount. This upfront cost can negate some of the savings from the lower interest rate.
  • Risk of Higher Debt: If you're not disciplined, a balance transfer can lead to higher debt. Once the balance is moved, you might be tempted to spend more on your old card, potentially leading to more debt than you started with.
  • Impact on Credit Score: Initially, a balance transfer might have a negative effect on your credit score. This is one of the disadvantages of a balance transfer. Applying for a new credit card leads to a hard inquiry on your credit report, which can temporarily lower your score.

How To Save Money with Balance Transfers

A balance transfer card often comes with an introductory offer of a 0% interest rate for a set period, typically 6 to 21 months. This means every payment you make during this period goes directly to reducing your principal debt, rather than being partly used up by interest charges.

A balance transfer, while potentially beneficial, can be a double-edged sword if not handled carefully.

If you continue to accumulate charges on your old card after the transfer or add expenses on the new one, you may sink deeper into debt. If you're unable to pay off the transferred amount before the introductory period ends, you could be hit with a higher interest rate on the remaining balance.

You should approach balance transfers with a solid repayment plan and disciplined spending habits to prevent escalating your debt. To truly benefit, you'll want to pay off as much of your balance as you can during the low-interest period.

mglogo icon

If you miss a payment, your promotional interest rate may expire early. Set up automatic payment of the minimum amount due to avoid late fees and interest rate surprises. -- Lee Huffman, credit card expert at

Understanding Balance Transfer Fees

When considering if a balance transfer is a good idea, it's essential to factor in the often-overlooked balance transfer fees. Are balance transfers bad due to these fees? Not necessarily, but it's important to be aware of them.

Usually, they range from 3% to 5% of the transferred amount or a minimum amount set by the issuer, whichever is higher. So, if you're transferring a large balance, this could mean paying a significant amount upfront. You should calculate these fees against the potential interest savings to ensure your balance transfer strategy makes financial sense.

Should You Do a Balance Transfer?

A balance transfer could be a strategic financial move if used wisely. However, it's crucial to assess whether it aligns with your specific financial situation and goals.

Here are some considerations to help you decide:

  • Are you carrying high-interest credit card debt? Balance transfers are particularly useful when you're struggling with high-interest debt. By transferring your balance to a card with a lower interest rate, you can potentially save a significant amount of money on interest.
  • Can you pay off the balance within the introductory period? Many balance transfer cards offer a 0% introductory APR. However, this rate usually only lasts for a certain period (typically six to 21 months), after which the rate increases to the higher, standard APR. Consider whether you can realistically pay off the balance within that timeframe.
  • Are the balance transfer fees worth it? Balance transfers often come with fees. Calculate whether the cost of the transfer fee is less than the amount you'd save on interest to avoid unnecessary fees.
  • Are you disciplined in your spending habits? A balance transfer can be a helpful tool, but it requires self-discipline. It's important to resist the temptation to rack up more debt on the old card once it's been paid off.

After considering these points, you can make an informed decision about whether a balance transfer is right for you.

MORE: Best Balance Transfer Credit Cards in 2023

Alternatives for Credit Card Debt Management

Balance transfers can be a great tool for managing credit card debt, but they aren't the only option. It's important to consider all your choices and find the best strategy for your unique financial situation. Here are some potential alternatives:


Debt consolidation loan

These are personal loans used to pay off multiple debts, including credit card balances. You then repay the loan in fixed monthly payments. It can be a great option if you can secure a lower interest rate than your current credit cards.


Debt management plan

Non-profit credit counseling agencies can help you set up these plans. They also negotiate with your creditors to lower interest rates and waive fees, then you make a single payment to the agency each month.


Credit card hardship program

Some issuers offer these programs to help struggling cardholders. They may lower your interest rate, reduce your minimum payment or even temporarily pause your payments.


Reducing spending to pay off debt

If you can tighten your budget and cut down on unnecessary spending, you can put more money toward paying off your credit card debt. This approach can be very effective. It saves you money on interest over time, and it also helps you clear your debt more quickly.

FAQs About the Pros and Cons of Balance Transfers

When it comes to balance transfers, we understand that you may have a few questions. That’s why we answered some of the most common queries to help you navigate your financial decisions.

Next Steps

Now that you understand the pros and cons of balance transfers, determine if this might work well for you. If you feel it might, then base your search for a suitable balance transfer card on factors such as duration of the 0% APR offer, annual fees, regular APRs and additional benefits.

Compare & Review Credit Cards

MoneyGeek experts use data provided by the Bureau of Labor Statistics (BLS) to analyze the spending trends of people across the country. They also monitor changes in fees, APRs and offers of over 1,600 consumer credit cards so that our readers may find alternatives to suit their needs with ease.

Learn More About Balance Transfer Credit Cards

Our editorial team remains up to date on the latest financial trends and changes in the credit card industry. If you have any questions about credit cards, be it about how to select the best balance transfer card and what to look for in a rewards card, you may rely on it to provide quick and useful answers.

About Grace Pilling

Grace Pilling headshot

Grace Pilling is passionate about empowering readers to make informed financial choices to support their best lives, not a company’s bottom line. Prior to joining MoneyGeek as a senior content manager, Grace was a senior editor at and Bankrate, where she focused on teaching people how to use credit cards wisely.

*Rates, fees or bonuses may vary or include specific stipulations. The content on this page is accurate as of the posting/last updated date; however, some of the offers mentioned may have expired. We recommend visiting the card issuer’s website for the most up-to-date information available.
Editorial Disclosure: Opinions, reviews, analyses and recommendations are the author’s alone and have not been reviewed, endorsed or approved by any bank, credit card issuer, hotel, airline, or other entity. Learn more about our editorial policies and expert editorial team.
Advertiser Disclosure: MoneyGeek has partnered with and for our coverage of credit card products. MoneyGeek, CardRatings and may receive a commission from card issuers. To ensure thorough comparisons and reviews, MoneyGeek features products from both paid partners and unaffiliated card issuers that are not paid partners.