Using Balance-Transfer Cards to Pay Holiday Bills

Interest-free balance-transfer offers are back and better than ever -- if you weigh your options first.

I've received several offers from credit card companies recently to transfer my existing account balance to a new card interest-free. I'd like to take advantage of one of these 0% balance transfers to pay off my holiday bills. Is there a catch?

A balance transfer can be a great way to pay off your bills, but you need to weigh the offers carefully. Most cards charge an upfront transfer fee of 3% to 4%, says Bill Hardekopf, of, so it would cost $300 to $400 to transfer a $10,000 balance. That makes sense only if the transfer fees are less than what you expect to pay in interest on your existing balance.

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Kimberly Lankford
Contributing Editor, Kiplinger's Personal Finance

As the "Ask Kim" columnist for Kiplinger's Personal Finance, Lankford receives hundreds of personal finance questions from readers every month. She is the author of Rescue Your Financial Life (McGraw-Hill, 2003), The Insurance Maze: How You Can Save Money on Insurance -- and Still Get the Coverage You Need (Kaplan, 2006), Kiplinger's Ask Kim for Money Smart Solutions (Kaplan, 2007) and The Kiplinger/BBB Personal Finance Guide for Military Families. She is frequently featured as a financial expert on television and radio, including NBC's Today Show, CNN, CNBC and National Public Radio.