smart spending

Trick or treat: 7 money tips

Balance transfers
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Balance transfers

You get the chance to put your old debt balance on a new card with a zero percent APR.

The treat: For the short term, it will save money in interest. And you can put that savings toward the balance.

The trick: Whether it remains a treat depends on what you and the card issuer do next, Jones says.

"You have to be very careful," he says. "After the grace period is over, the card could be at a relatively high interest rate. It's important that consumers really look at the contract that they've signed."

Among the questions to ask about the card: Will the card run a higher rate for your transfer than for regular purchases? How will your payments be applied?

Questions to ask yourself: Are you transferring the balance so you can put money that would have gone to interest toward the principal? Or do you just want room on your cards for more debt?

Jones has advice for making sure you get a treat with no scary surprises: If you do a balance transfer, put the old cards on ice until you've paid the transferred debt. And don't put any new charges on the new card until you've paid off the transferred balance.


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