Credit card customers can save up to £1,679 with a simple debt ‘spring clean'
But a quick balance transfer could help you clear your debt faster and save money in the process.
New research from TotallyMoney revealed that half (48.8%) of credit card customers are currently paying interest on their balances every month.
And by making use of a balance transfer deal, the finance company claims they could save up to a whopping £1,679 each.
A balance transfer means moving some or all of your credit card debt from one to a new provider offering 0% interest for a set time, currently up to 33 months.
While there's usually a small transfer fee of around 3% or 4%, the interest savings can far outweigh this, adding up to a huge amount as the months go by.
'They're an effective way to cut costs, and you could start saving money before the start of summer,' Alastair Douglas, TotallyMoney CEO, says.
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According to TotallyMoney, the top balance transfer deals available right now are from Tesco Bank, HSBC and Barclaycard, each of which are offering 33 months interest free.
A person with an average interest-bearing balance could avoid paying £1,679 by switching to the HSBC 33-month card. It has one of the lowest fees on the market at 3.19% too.
The average saving with Tesco Bank is £1,675, but Alastair also notes that it comes with 0% interest on further money transfers for nine months, 'which you could use to clear expensive overdraft debt.'
Barclaycard's 33-month deal comes with a slightly higher fee of 3.45%, meaning a typical customer could save £1,671. But, for those who want to skip fees entirely, the bank has a 14-month fee-free balance transfer card too, allowing successful applicants to save an estimated £753.
Other providers, including Vanquis and Fluid, are next on the list with their balance transfer offers – 18 and nine months, respectively – which could help you cut your interest bill by £881 and £394.
Bear in mind though, you'll need a good or excellent credit score to be accepted with these lenders – and making multiple applications can harm your credit – so it's best to check eligibility before submitting. More Trending
Plus, although a balance transfer can be beneficial, it only saves you cash if you pay off as much of your debt as possible during the interest-free period.
Personal finance expert at CredAbility, Aaron Peake, advises: 'If you're regularly carrying a balance month to month, switching cards might offer breathing room, but it's also worth using this time to build habits that help you avoid falling back into the same pattern.
'It's easy to focus on the interest-free period as a way to delay, but to make the most of it, you should treat it like a repayment deadline. Set yourself a realistic repayment plan and automate it if you can. Divide your balance by the number of months you've got interest-free and aim to clear it within that time.'
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