It’s completely normal to try things like using balance transfer credit cards and debt consolidation when you first start working on getting out of debt.
I did, and it didn’t work.
Because you can’t borrow your way out of debt.
The offers sound good, but…
Of course paying less interest or having to make fewer payments each month sounds good, so it’s only natural to look into things like that. But — unless you’re talking about payday loans — it’s probably not the interest that’s the problem.
The real problem is that you need to end the cycle of debt, and you can’t do that by borrowing your way out of debt.
Change your habits
So before you even consider using balance transfer offers or debt consolidation, change your habits. Doing otherwise is likely to put you even deeper in the hole, despite your best intentions.
It is possible to use 0% balance transfers to reduce the interest you pay on what you owe, once you’re already well into debt-reduction mode.
You “just” have be sure that you’ve already cut up your old credit cards, that you never use the new card for anything other than the initial balance transfer, and that the new one will be paid off before normal rates (which can be pretty high) kick in.
And you have to avoid the rest of the cons of balance transfer along the way.
But it’s a whole lot easier just to pay off your debts by shoveling money at them as fast as you can. Don’t try to get fancy. If you want to pay less interest, the surest way to do so is to get an extra job and use the money you earn there to get your debt paid off even faster.
Why the argument doesn’t apply
The argument, of course, is that using these offers responsibly can be a great way to pay less interest and get out of debt faster. To which I say….if you owe money and are struggling to get it paid off, you haven’t been using debt responsibly. Telling yourself that things will be different this time won’t make it so.
Of course you didn’t intend for things to be this way. You may have had some unusual circumstances, or been sucked in by all the “logical” reasons for using debt. But getting out of debt isn’t logical. It’s emotional.
Remember, you can’t borrow your way out of debt. Stick to your plan and get it done, instead of looking for shortcuts.