Are people managing their debt properly?

More than half of UK credit card holders say they would never consider doing a balance transfer on their credit cards, according to new research by Nationwide Building Society. By not moving their balance, people are not taking advantage of a useful way to manage their debt, and more importantly, could be missing out on significant savings.

In a survey of over 1,800 UK credit card holders, 53 per cent said they would never consider transferring their credit card balance to a new card. Yet, almost a quarter (24 per cent) would consider transferring a balance of up to £2,000.

People who don't pay off their card balance every month could save by transferring their balance to a card with a lower interest rate. For example, the Nationwide Credit Card and Select Credit Card both come with a competitive introductory offer of 0 per cent for 20 months on balance transfers in addition to a range of other benefits including cashback, low APR and commission-free purchases abroad.

All balance transfers come with a fee attached yet, even including a fee of 3.1 per cent, a person could save £172.25 if they transfer £1,000 to a Nationwide credit card from another card charging 12.9 per cent APR. The saving increases to £259.61 if transferring the same amount from a card with an APR of 18.9 per cent and £343.03 from a card with an APR of a 24.9 per cent.

In addition, anyone now opening either of the Society's two credit cards via nationwide.co.uk will benefit from a 50 per cent discount on the balance transfer fee. The reduced fee of 1.55 per cent, along with the introductory offer above, is only available if the balance transfer occurs within the first three months of opening.

Paul Carvell, Nationwide's head of credit cards, said: "The New Year can often bring with it the stress of how to manage debt racked up through Christmas-related expenditure, particularly on the credit card. By taking advantage of a 0 per cent balance transfer offer, people can relieve some of that pressure, giving them the opportunity to reduce those balances at a manageable rate.

"This makes it all the more surprising that people would not think about moving their balance to take advantage of these offers. If nothing else, by not even considering a balance transfer, people are missing out on significant savings, which when you are trying to clear down debt, is crucial."