Looking for a short-term solution...
rather than a long term 0% credit arrangement ? Most zero percent credit card deals run for a maximum of around 18 months. Pay the debt back, in full, sooner than that to be sure to avoid expensive fees and rates!
Certain that the payments are totally affordable...
...and the minimum monthly payback on the credit card is made (on time!) for each month the 0% term runs? If you are the forgetful type, set up a direct debit each month to be absolutely certain you don't end up getting caught! Fail to pay a monthly minimum, and the 0% deal could end -- abruptly!
Pay the entire amount due before the expiry. If for any reason you can't pay the credit card debt off, in full, by the end of the 0% period, arrange, in advance a zero percent balance transfer.
WARNING: 0% credit cards are not free money!
Be sure to avoid a vicious cycle of debt. It's always useful, before making any credit card purchases, to make a list of your monthly outgoings to ensure there is spare money to pay the debt off in time. Don't borrow money, in any form, as a "rob Peter to pay Paul" solution. Ask for advice from family, friends and independent advisors if you feel uneasy.
Credit cards - the 'no-nos'
What not to do with zero percent credit cards:
Never, ever use a zero percent credit card to buy stuff where there is no immediate hope of paying back --quickly, if needed.
Nor should the tempting offer of "free money" (for a set period, of course) be a way out of existing debt. Sooner or later, if all thats paid is the minimum monthly payments, soon, the the full market rate (APR %) for the money borrowed, PLUS any additional debts that are in place may become just too much.
What IS NOT required is a vicious cycle of spending, debt, and more spending. Eventually, the credit rating will decline if this occurs, and this can only reward the bankers! Its a case of being sure to apply for the correct credit card deal: one that suits your individual circumstances. Don't rack uip debts you won't be able to fully repay in time!
Don't be forgetful -- it costs!
Being forgetful costs money. All the time! Even if you followed the major 101 credit card advice above, and set up a standing order or monthly direct debit to ensure that a minimum payment is never missed (and thus hang on the zero percent rate for the headline duration), still don't forget just when the interest free period expires. Doing so can be costly, because, suddenly, one month the FULL APR on your debt will be due! It hurts and its expensive to forget when the interest free period expires.
So get a diary! Put it on a calendar! Put it in an email reminder program. Write it on the wall -- just don't end up forgetting when the interest-free credit card period eventually runs out. And put it somewhere that's sure to be a reminder in the 8,12, 16, 18 months when it expires.
Diarise it so that, one month or so before the debt's interest is due, it can be decided to pay it off in full (if you took the advice above and looked upon it merely as short-term, interest free loan then there may well be enough money to pay off in full by the interest free term end). But if you can't, there is time to move the remaining balance, minus any paid to a new zero percent card. Dont pay any more than is necessary by being prepared!
So, we need to be certain, when applying for a 0% credit card that we can pay off the balance, at the end of the interest free period, IN FULL. Credit card companies will penalize heavily those than can either not do this -- AND those that fail to meet the minimum monthly payments.
My first major advice with 0% credit cards is this: whether you've taken out the card for new spending, or performed a balance transfer, YOU MUST NEVER SKIP A MONTHLY MINIMUM PAYMENT. EVER. Its easily done. All you have to do is forget, just one time, to pay it, and your zero percent deal is suddenly gone. This is almost always the case with any 0% credit card arrangement. So, set up a direct debit to come straight out of your bank on an agreed day every month to cover the minimium payment. That way you can't forget! Always try to pay off more than the minimum if you can, but at least if you do this, and you do forget to top up the monthly credit card balance, you wont lose the zero percent deal. The key is to pay off the 0% credit card balance, in full, on or before the last date of the zero percent deal, or switch using a balance transfer to avoid costly interest rates!
Credit cards with 0% come in two major flavors:
You need to decide if your aim is to:
a) Set up a 0% card for new borrowing
b) Set up a 0% card for an existing credit card debt.
For new borrowing, the best possible deal is one where the 0% interest period is the longest you can find. Offers from various credit card companies are subject to a lot of competition, and right now the very best deals are offering up to 18 months interest free on new purchases. Seek out the best deals online, or in the local or national press. Compare reviews of customer service, if its important to you -- or simply hunt down the longest zero percent deal you can find. Up to 12 months at the moment is average, though exceptionally you may find up to 18 months interest free credit avaiable.
When you are transferring an existing credit card balance to a new 0% card (on 'balance transfers') what you are really doing is giving yourself more time to pay off an existing debt, without incurring any monthly interest charges. But there is a cost to pay. Again you need to shop around: credit card companies not only differ in the length of the interest free period they offer, but how they make charges at the time of the movement of money from your old card to your new card differs. Most will charge a fixed percentage of the amount you want to transfer, or a fixed fee. Some may charge both. Be sure to ask, during your application, exactly what fees there are and what they are for. In this way, you again shop around for the best deal online, nationally or locally until you find the most cost-effective to move your balance, and, at the same time, extend the time over which you can pay it back without having to pay any interest.
Cutting costs, saving money in 2014: Start by making sure you are getting the most of 0% credit
Stuff you may find useful:
Is the latest credit check score good? For those with a tainted credit history, it may not be possible, in the first instance, get a 0% credit card deal -- so this may not be an option. The credit score matters!
For a long-term constant influx of money that earnings or lifestyle doesn't support, then credit cards, zero percent or otherwise are NOT the solution!
Zero percent credit in 2014: Make sure you get the best deal, and use 0% credit properly!
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Costingless: Find ways to cut costs at home in 2014!