Can you pay off a credit card with another credit card?
Have you ever wondered if you can pay your credit card bill with another credit card? And if you can, is it a smart financial move to do so? Credit card issuers limit the types of accounts you can use to pay your credit card bill, but there are workarounds. Let's examine your options.
Can I pay my credit card with another credit card?
Banks and card issuers typically accept checks, money orders and payments from checking accounts for credit card payments. However, other options include taking a cash advance or using a balance transfer. Here's a closer look at each one.
What is a cash advance?
A cash advance works just like it sounds. It's a transaction that allows you to access cash from your credit card limit. For example, instead of using your debit card to withdraw cash from an ATM, you use your credit card to take out money. This money is borrowed against your credit card's credit limit.
The one positive of a cash advance is that it offers quick access to money. However, cash advances are generally the most expensive option and not something we recommend.
Here's why:
- Cash advances are subject to costly fees, usually a fixed dollar or percentage of the total cash advance amount.
- Cash advance annual percentage rates are higher than credit card purchase APRs, and interest begins to accrue from the day you take the advance. There is no grace period.
- Withdrawal amounts are capped and are often a small percentage of your total credit limit.
- Unlike purchases, you can't earn reward points on cash advances.
Related: Can you get cash back from a credit card?
What is a balance transfer?
A balance transfer moves debt from one credit card to another. The main purpose of a balance transfer is to save money by shifting the debt from a higher-interest to a lower-interest card. If you're doing a credit card balance transfer, always try to find a card with a 0% introductory APR offer. These promotional offers can last anywhere from 6 to 21 months.
Also, before you execute a transfer, always check the new card's standard APR because that's the rate you'll be paying after the 0% introductory APR expires.
Another consideration is that balance transfers have fees (usually 2% to 5% of the amount transferred) or a fixed dollar amount, such as $10 — whichever is greater. Also, following the balance transfer, be careful not to rack up more debt on the card you transferred the balance from.
Keep in mind that if you have two credit cards from the same issuer, they will not allow you to do a balance transfer. You can only do balance transfers from credit cards between different issuers.
Related: How to do a balance transfer
Should I pay my credit card with another credit card?
Generally, you should only pay your credit card with another credit card as a last resort. Balance transfers are a better option than cash advances as they have fewer fees and can temporarily remove your interest charges if you utilize a 0% introductory APR card.
If you're struggling to manage your credit card debt, another option is to call your card issuer and ask if they have any temporary payment relief options or if you qualify for an interest rate reduction. Many issuers are willing to work out payment arrangements if you have a track record of making on-time payments.
Related: What kind of debt can you transfer to a credit card?
Bottom line
You should avoid using a cash advance to pay your credit card with another credit card, as you will have to pay interest and fees for the cash advance. Balance transfers are a better option with more upside and fewer fees. However, we always recommend paying your credit card balance in full every month whenever possible.
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