For those who have a balance on credit cards from one billing cycle to the next, you can also consider reducing the amount of interest you pay by using two different credit cards, says Patrick Whalen, a certified financial planner in Los Angeles.
Use the card with the highest interest rate for purchases that you know you can pay for by the end of the billing cycle. Then use the card with the lowest interest rate for purchases you may need to carry over to the next month, Whalen says.
You should also try to reduce this balance as soon as possible, perhaps by making mid-cycle payments to minimize interest costs, or by refraining from using it until the balance is paid off.
Another strategy is to move your debt to a zero-balance wire transfer card, says Ted Rossman, senior industry analyst at Bankrate.com. This step allows you to transfer your balance to a card that allows you to pay no interest for an extended period of time, sometimes up to 21 months. This gives you time to pay off your debt.
However, you need to have a good or excellent credit score — about 700 or more — to qualify for an attractive fund transfer offer. And you also need to be sure that you can withdraw your balance by the end of this period. Otherwise, you will end up generating more interest.
