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highpeak
Joined: 07 Jan 2006
Posts: 43
Location: Chapel-en-le-Frith, UK
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 Posted: Sat Jan 07, 2006 8:06 am Post subject: Money making from a credit card |
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Hi
I have heard that people are getting a 0% credit cards with the sole purpose of transfering a balance from the card to their high interest savings account. Take advantage of the introductory period on zero percent on transfers, then transfer the balance again and again when the offer period ends and keep the money in their savings account for a long period of time.
Is anybody doing this??
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Phil 
Lifetime's Savings Calculator | plus 10 more calculators |
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iFinancialAdviser
Site Admin
Joined: 28 Dec 2004
Posts: 1699
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PeterGibbons
Joined: 08 Jan 2006
Posts: 128
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| Posted: Mon Feb 27, 2006 10:35 pm Post subject: |
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Everything sounds great about that idea until you do the math and challenge the will of the average citizen.
For example:
Given the following,
6 month 0% APR introductory rate, then it goes to 14.99%.
$10,000 Credit Limit, all available.
$50 annual fee for this wonderful credit card.
Here is what would happen using a savings account,
$10,000 in a savings account for six months earning 2% annually would earn you approximately $100.
6 months is a long time.
Assuming you did not spend any of the money in Savings, you would simply recover your annual fee and have $50 left over in the best case scenario (while paying a monthly minimum payment on the credit card for the 6 months).
Worst case scenario, you owe $10,000 at 14.99% or higher, and you spent all the money in Savings.
This does not sound like a risk worth earning a profit of only $8.33 per month.
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Peter Gibbons
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john_nyc
Joined: 02 Jun 2006
Posts: 10
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| Posted: Fri Jun 02, 2006 2:11 am Post subject: |
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if you have a high yield savings or a 6 montsh cd making over 5% can be a nice way to make some money if you have the cah to build. But it also shows on your credit report that you have $xxx balance and you ar enot making payments
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Soniceffect
Joined: 11 Jun 2006
Posts: 22
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| Posted: Sun Jun 11, 2006 8:44 pm Post subject: |
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| PeterGibbons wrote: |
Everything sounds great about that idea until you do the math and challenge the will of the average citizen.
For example:
Given the following,
6 month 0% APR introductory rate, then it goes to 14.99%.
$10,000 Credit Limit, all available.
$50 annual fee for this wonderful credit card.
Here is what would happen using a savings account,
$10,000 in a savings account for six months earning 2% annually would earn you approximately $100.
6 months is a long time.
Assuming you did not spend any of the money in Savings, you would simply recover your annual fee and have $50 left over in the best case scenario (while paying a monthly minimum payment on the credit card for the 6 months).
Worst case scenario, you owe $10,000 at 14.99% or higher, and you spent all the money in Savings.
This does not sound like a risk worth earning a profit of only $8.33 per month. |
Nothin more I can say than ... In a nutshell Good post m8
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john_nyc
Joined: 02 Jun 2006
Posts: 10
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| Posted: Wed Jun 14, 2006 9:46 pm Post subject: |
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if you are using a credit card anyway and payting off the balance get a cash back card -- discover card and a there is another card advertising in NYC with 1.4% back -- i will find the ad and post it up
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altyfc
Joined: 29 Dec 2004
Posts: 1232
Location: Aardvarkland
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24Hours
Joined: 11 Aug 2006
Posts: 95
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| Posted: Tue Oct 10, 2006 10:47 am Post subject: |
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No, but the transferring to 0% introductory cards is a well-known way for people to pay off their debt sooner. That and calling up and negotiating lower rates.
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