Whether you read them or not, if you are like most Americans you receive several offers for credit card consolidation in the mailbox every month. The material states something to the effect that: 1) we’re offering you a brand new credit card; 2) we know you already have a bunch of credit cards—how do you think we got your mailing address?; 3) why have a bunch of payments every month?; so 4) transfer all your other credit card balances to this new credit card; 5) and you can even choose the card design from our amazing line of semi-personalized cards. It seems to make a lot of sense, too, because often the new cards have a "teaser" interest rate that is pretty low. If you take advantage of the special offer, your first monthly statement from the new company is likely to be quite a shocker—but the good news will be in the pile of fifteen other credit card statements that now show that satisfying "paid in full" at the bottom.
As with everything in life, there are two sides to this coin—before accepting, read the small print. After that "teaser" rate expires, the new card might actually have a higher rate than the old card. They might charge you a "convenience" fee for every transferred account. And—here’s the worst news of all—you still have to pay back all that money. If you find yourself searching for credit card consolidation offers so you can transfer your last credit card consolidation balance, it’s time to seriously consider an alternative approach to personal finances.