How Credit Card Debt Consolidation Can Help

You probably get flooded by ads everyday for credit card debt consolidation deals. Whether on TV, mail or email, they are out there and they want you. Let's face it, if you are a spender and use credit cards, then you are in their target market. But before you run for the hills from these ads because of their slick look, there are some benefits that you can gain from credit card debt consolidation if you choose wisely.

Anyone who has read any newspaper articles on credit card debt would already know what credit card debt consolidation is. However, just for the benefit of others, credit card debt consolidation, in simple terms, is the process of consolidating debt which you hold on various high APR credit cards onto just one low APR credit card.

The biggest benefit from consolidation usually results from the lower interest that you will pay. This can save you a lot of money, especially if you have a big balance and will need to pay it off over a few years. There are some other benefits to consolidation too.

Initial APR: This is usually the grabber. Pay 0% for some intial number of months, often 6 to 9 months, but sometimes more. Again, this can get you started if you are serious about paying off your debt.

Standard APR: Lower standard APR (i.e. the long term APR) is the other important benefit from credit card debt consolidation. Though not all credit card suppliers offer a lower standard APR, some do have a good standard APR. These credit cards offer a trade-off between initial and standard APR rates.

0% on Purchases: Try not to get excited about this. Your goal is to get your debt paid off remember? So you should not be looking to go on a shopping spree. But if you did have an emergency purchase that you absolutely needed, this might be a way to get it.

Easy Management: One bill, one balance. That is one nice thing about consolidating. This makes it easier to track how you are doing on your debt reduction and management of your finances.

Other Benefits: These are not as important, but you might get rebates, discounts or reward points depending on the type of card you get. Don't let this be crucial, but just an additional plus if you get it. You might even ask for something like this. Sometimes the phone rep holds things back and adds them if that will close the deal.

So once you get your old balances paid off, hopefully you have cut up those cards, because once these balances are zero, that is when the real test begins. Are you going to dig yourself a mucher deeper debt hole by using these cards again or are you finally committed to ridding yourself of credit card debt for good. If you are going to get rid of it, then a credit card debt consolidation can be a big help in achieving your goal.