Almost one in four (22%) credit card holders will make use of a 0% balance transfer deal in the next 12 months, as the difficult economic conditions continue to wreak havoc with people’s finances.
According to new research from Abbey, the figure has actually increased from 19% since the post-Christmas period – traditionally the busiest time for transfers.
The younger demographic are most likely to take advantage of such deals, with one third (34%) of 25 to 34 year-olds expected to transfer a balance from another credit card or their overdraft.
Transfers are slightly smaller
But while the number of transfers will increase, the actual amount transferred will fall slightly from £1,711 in the post Christmas period to an average anticipated amount of £1,604 over the next 12 months.
Abbey predicts that people aged between 35 and 44 will transfer the largest amounts (£1,996), while from a geographic perspective those in the Midlands will undertake the heftiest transfers (£1,914).
The research also highlights a stark contrast between the sexes, with men (£1,708) expected to switch notably more debt than women (£1,480).
"The research suggests that balance transfers are providing much needed flexibility to cardholders at a time when many are feeling the pinch,” says Callum Gibson, head of Abbey Credit Cards.
Find the right deal
With balance transfers proving so popular, it’s hardly surprising that there are so many different deals on the market.
But, as with most financial products, there is no one balance transfer card that is best for everyone. Rather, it depends on your specific financial situation. For example, if you have a small debt that can be cleared quickly, you should consider one of the various short term deals that charge no fee whatsoever, such as the Ulster Bank Gold Card (0% for six months) and Abbey’s Zero card (0% for 6 months).
However, if you have a fairly substantial sum to pay off, you’ll be far better served choosing the longest possible 0% card on the market and paying the small transfer fee. Currently the best such deals on the market are Virgin’s credit card (0% for 15 months, with a 2.98% fee) and Barclaycard’s One Pulse (0% for 14 months, 2.5% fee).
