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\n<\/p>\n
Martin Lewis\u00a0shared an important tip to cut credit card interest down to zero to help people pay back just what they owe.<\/p>\n
The Money Saving Expert founder took to his Money Show this evening to tackle the topic of credit scoring and managing debt.<\/p>\n
Addressing viewers, Mr Lewis said: \u201cThe key weapon if you have credit card debt is a balance transfer.<\/p>\n
\u201cPeople do get confused, so let me just take this back to basics. Imagine you’ve got two not-very-nice cards.\u201d<\/p>\n
He used an example of having two credit cards, one with a 19.9 percent APR and another with a 21.9 percent APR. One has \u00a3700 debt, the other has \u00a31,100 debt.<\/p>\n<\/div>\n
Explaining how a balance transfer card can help, he said: \u201cYou need something to sort you out, so you apply for [a balance transfer card] at zero percent for two years with a \u00a32,000 credit limit.<\/p>\n
\u201cThis is what happens. You ask the [balance transfer card] to do a balance transfer. In practice, it then pays off the debts on the other cards for you.<\/p>\n
\u201cSo those debts are gone. Those cards are now empty. Instead, you owe [the balance transfer] card the \u00a31,834.<\/p>\n
\u201cBut now, instead of an average rate of around 20 percent a year, you’re not paying any interest on it at all, and the practical point on that is pretty simple.<\/p>\n<\/div>\n
\u201cAll of your repayments towards the card are clearing what you actually owe, rather than just servicing the interest and going towards the profit of the credit card company.<\/p>\n
\u201cThat is a balanced transfer in a nutshell.\u201d<\/p>\n
However, Mr Lewis pointed out that the balance transfer market is getting \u201ca little bit more difficult\u201d with zero percent interest time spans reducing.<\/p>\n
Additionally, the fees people must pay to transfer their credit card balances over to the new card are increasing, which is something people should watch out for.<\/p>\n<\/div>\n
He said: \u201cThere’s a one-off balance transfer fee that you pay a percentage of the debt you shift. So let’s say it’s a three percent fee, – that\u2019s \u00a330 you pay for every \u00a31,000 you shift.<\/p>\n
\u201cFees have got a bit bigger. You’re not going to get the best deals anymore.\u201d<\/p>\n
However, he noted: \u201cBut it’s still absolutely worth doing and the hope is, if interest rates do drop during this year, as predictions are now moving towards it, these may get a little better in six months.<\/p>\n
\u201cBut if you’re paying interest on your debt, you shouldn’t wait for this to get on with it.\u201d<\/p>\n
The Martin Lewis Money Show airs every Tuesday on ITV and ITVX at 8pm.<\/em><\/p>\n<\/div>\n [ad_2]<\/p>\n","protected":false},"excerpt":{"rendered":" [ad_1] Martin Lewis\u00a0shared an important tip to cut credit card interest down to zero to help people pay back just what they owe. The Money Saving Expert founder took to his Money Show this evening to tackle the topic of credit scoring and managing debt. Addressing viewers, Mr Lewis said: \u201cThe key weapon if you […]<\/p>\n","protected":false},"author":1,"featured_media":24470,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[3],"tags":[],"_links":{"self":[{"href":"https:\/\/farratanews.online\/wp-json\/wp\/v2\/posts\/24469"}],"collection":[{"href":"https:\/\/farratanews.online\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/farratanews.online\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/farratanews.online\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/farratanews.online\/wp-json\/wp\/v2\/comments?post=24469"}],"version-history":[{"count":0,"href":"https:\/\/farratanews.online\/wp-json\/wp\/v2\/posts\/24469\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/farratanews.online\/wp-json\/wp\/v2\/media\/24470"}],"wp:attachment":[{"href":"https:\/\/farratanews.online\/wp-json\/wp\/v2\/media?parent=24469"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/farratanews.online\/wp-json\/wp\/v2\/categories?post=24469"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/farratanews.online\/wp-json\/wp\/v2\/tags?post=24469"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}