Credit cards are powerful financial tools. When used correctly, they can help manage cash flow, give you annual percentage rates for a limited time, or even help you generate cash back and other rewards.
But going over your head can be a problem, and if you’re struggling to make payments, many people wonder if it’s possible to pay off your credit card debt with another credit card.
Unfortunately, no. You can’t pay off your outstanding credit card debt with another card, but that doesn’t mean you don’t have options.
Unfortunately, it is not possible to make your monthly payments with your credit card. Most credit card issuers limit the ability to pay off your card balances to funds drawn from a bank account. This is to limit your risk; card issuers want to know that you will be able to pay your debts, not simply transfer them elsewhere.
Although banks want to know that you can pay your debts, it is still possible to transfer debt from one card account to another. You can do this with a balance transfer.
Balance transfers can be a useful option, especially if your bank offers you a 0% APR for a limited term on the balance transferred. Some credit cards offer this as an option when you first open your card account. Balance transfers may also be available on your existing cards, with varying rates as decided by your bank.
Many credit cards offer cardholders a credit card cash advance, although it’s generally not a good idea to use one. However, when you come up short, it can help you make your payments.
A cash advance works like a short-term loan on your credit card. Instead of using your credit for purchases, you use it to borrow cash. The credit limit for advances is not the same as your credit limit for purchases.
The cash advance rate is usually much higher. Cash advances generally have a higher interest rate than your standard credit card interest rate, but check with your card issuer to be sure.
Another negative is that interest on the amount advanced will start accruing immediately, unlike purchases, which often have a grace period when interest is not charged.
If you are one of the many people who are struggling with credit card debt, there are also other options for paying off credit card debt.
Below you will find out what they are:
Debt Consolidation: Many banks allow you to obtain personal loans. These can be used for a variety of different reasons, including home renovations, maintenance and credit card debt consolidation.
Doing so allows you to bundle all of your card payments into one payment, and your loan may charge a lower interest rate than your credit cards.
Snowball Method: A popular method of paying off debt, the snowball method has you focus on paying off your smaller debts first.
Once all of your minimum payments are made, you put your excess funds toward paying off those smaller balances. This allows you to create a snowball effect, freeing up those funds to go toward your next smaller balance.
Avalanche Method: Another popular debt repayment strategy, the avalanche method focuses on paying off your debt at the highest interest rate first. After making all of your minimum payments, you then put the remaining funds on your most expensive cards. This allows you to save more money, which you can use to pay off more debt.