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By: AgFed Credit Union

Welcome to AgFed Credit Union's MoneyDig blog! 

Get confident about your personal finances with a number of articles, tips, advice and more.


Consolidate Credit Card Debt Before the Holidays

 Nov 01, 2021
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With the holiday season right around the corner, now’s the perfect time to get a handle on any outstanding credit card balances. The last thing you want to do is add costly holiday expenses onto existing balances – especially if that debt is already difficult to manage.

One of the easiest ways to organize and eliminate credit card debt is through a balance transfer. This tool allows you to move balances from your existing credit cards to a new card, usually with a more attractive interest rate. With a lower interest rate, you’ll save money each month that can then be put towards the principal portion of your outstanding debt – helping you eliminate the total quicker.


How Does a Balance Transfer Work? 

A balance transfer is a process of moving debt from one or more credit cards to another credit card, typically with a lower interest rate. Instead of juggling multiple credit cards, each with its own rates and due dates, you’ll only have one card to manage.

To illustrate how a balance transfer works, review the following example.


Suppose you have three different credit cards with balances totaling $5,000. Each credit card has a different interest rate.

Credit Card #1

Credit Card #2

Credit Card #3







New Credit Card





With a balance transfer, you would move your current three credit card balances to a new credit card. Now, instead of managing three credit card balances, you only have to make one monthly payment. Plus, the interest rate is much lower than your previous cards – allowing you to save each month significantly.


Benefits of Consolidating Credit Card Debt Before the Holidays

While one of the most enjoyable times of the year, the holidays can also be one of the most expensive times. Gifts, travel, and family gatherings all dig into your monthly budget. Preparing yourself financially for these expenses will help you alleviate stress, among many other things.

  • Simplified payments. Instead of juggling multiple credit cards, a balance transfer allows you to focus on making only one monthly payment.


  • Reduced interest. Consolidating high-interest credit cards into one lower-rate card will help you significantly lower the amount of interest you were paying. In the example above, we consolidated the interest rates of 18%, 23%, and 15% into a lower-rate card that only charged 9% interest. NOTE: Most credit unions cannot charge interest rates above 18% - unlike bank cards that can reach up to 30% APR!


  • Faster payoff. By reducing your interest rate with a balance transfer, you’ll pay less interest each month. Use those savings to pay more toward your outstanding balance to pay off the entire balance quicker.  


  • Eliminate stress. The holidays can be very stressful in general. Reducing credit card debt and the hassle of managing multiple balances before the rush of holiday festivities will help brighten your spirits.


Finding the Right Card

Contrary to what commercials want you to believe, credit cards and the rewards you could potentially earn are not a game. If you’re using a credit card, your goal should be to pay off the balance quickly and incur as little interest as possible.

When looking for a credit card to transfer your outstanding balances, find a card with the lowest interest rate possible. Rewards are a bonus, but only after you identify the lowest-rate card.


We’re Here to Help!

As your credit union, we want to ensure your holidays are bright and merry. Beginning the holiday season with less debt and less stress can really add to the overall spirit of the holidays.

If you’re interested in eliminating credit card debt, we’re ready to help. Please email us at or give us a call at 202-479-2270 to learn about our different debt consolidation options. 

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