From November 2009 to November 2010, 0% balance transfers have increased by more than 35% according to Experian. While this may indicate that many consumers are starting to plan for holiday expenses more than in previous years, it also demonstrates a high expectation of debt. In any case, balance transfers, even 0% balance transfers, have benefits as well as drawbacks that must be considered. Here's the lowdown:

THE GOOD: Obviously, a 0% balance transfer can help you pay off an existing debt or help you to self-finance a large purchase (or series of purchases a.k.a. holiday shopping), but a 0% balance transfer may be used as a cash advance. Although not all credit card companies allow this, most of the larger companies, such as Bank of America do. In this way, your 0% balance transfer could even be used to pad your bank account, create an emergency fund, or to open or contribute to a retirement account.

THE BAD: Of course, balance transfers have costs you have to keep in mind. Most notably, you may be hit with a balance transfer fee. These fees range from 3-10 percent and are subject to interest. As such, borrowing $5,000 can cost you as much as $500, plus interest; the balance transfer may be at 0% but that does not mean that any fees assessed on your account or purchases you make using that account are afforded the same low interest rate.

THE UGLY: Further, you need to be certain of the balance transfer terms. Many credit cards (department store credit cards are famous for this) will apply interest retroactively if your balance is not paid in full by the end of the introductory 0% balance transfer period. This means if you took a $5,000 balance transfer, and the credit card has 19.99% interest on balance transfers normally, you will end up being assessed that $1,000, even if you only have $100 remaining on your balance when the introductory period ends!

Just some things to think about before you take that 0% balance transfer. It may not be as great as you think!