Consolidating High Interest Debt

Someone reading off credit card information while holding a phone and sitting in front of a laptop.

Posted on September 3, 2019 Last Updated: April 21, 2022

Learn the basics of transferring credit card balances and saving money

Not all credit cards are created equal. Terms can vary widely from card to card including annual percentage rates (APRs), annual fees, repayment conditions, and borrowing limits.

Once in a while, it’s important to review the terms of your current credit cards, along with the balances on each, and consider whether transferring and consolidating your balances into a single card with a lower APR makes sense for you.

Payoff balances faster

Transferring balances with high interest rates to a card with a lower interest rate does two things: 1) Helps you pay off balances faster, and 2) Saves you money. Consolidating credit cards can also help you simplify your debt management; now you’re making just one payment instead of making multiple payments a month.

Compare rates and features

It’s important to know what your current credit card issuer is charging you for interest. Check your monthly credit card statement. Compare that interest rate with rates from other financial institutions and see how they measure up.

Look over other terms of the new card too. How much can you transfer? What are the repayment requirements? Is there a rewards program (like cash back) you can leverage? Does it charge an annual fee?

Fee versus no-fee

Here’s another important consideration: Some cards will charge a balance transfer fee to make the switch. You should consider all the terms together and see if a program that includes a transfer fee makes sense for your situation. The fees may be worthwhile to get the rate you want, but with some transfer fees, you end up paying more over the long run.

Keep an eye out for new credit card programs that feature introductory interest rates for balance transfers. Such introductory rates can save you even more money in the first few months of the new card, perhaps up to a year.

Credit scores

For some credit card holders, consolidating balances can result in better credit scores. Whether you leave old cards open or closed, credit rating companies like to see a history of good money management and consolidating cards to make payments manageable can help.

The Advantage of a KEMBA Credit Card

KEMBA Financial Credit Union offers a low-rate credit card that features a special balance transfer promotion, for a limited time, and offers cash back rewards on every purchase you make. These rewards are deposited annually into a special high-interest Rewards Savings account. With a KEMBA low-rate credit card, consumers can experience monthly savings and the ability to pay debts down faster.

For a limited time, new KEMBA credit card holders can enjoy a 0.00% APR for twelve months on all balance transfers. To learn more about consolidating your credit card debt and transferring high-interest credit card balances, apply online or contact a KEMBA Member Service Representative at 800.282.6420, option 2.


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