Balance Transfer Calculator: Calculate How Much You Could Save | The Ascent - Motley Fool

Credit Cards
Banks
Check out our top picks of the best online savings accounts for August 2021.
Get Started!
Brokers
Mortgages
Insurances
Loans
Before you apply for a personal loan, here's what you need to know.
Get Started!
Knowledge
Many or all of the products here are from our partners that pay us a commission. It’s how we make money. But our editorial integrity ensures our experts’ opinions aren’t influenced by compensation. Terms may apply to offers listed on this page.
A credit card balance transfer can be a good way to save money on credit card interest fees but only when the numbers work out. You can use this balance transfer calculator to determine if a balance transfer card can actually help you save money. To do that, simply input your balance, annual percentage rate (APR), and monthly payment for your current credit card and the fee and APR on the balance transfer card to see how much you could save.
Save ${{ computedData.btSameMonthlyPayment.savings | withCommas }} using a balance transfer card. You’ll keep your current monthly payment (${{ computedData.btSameMonthlyPayment.monthlyPayment | withCommas }}).
Take full advantage of a Balance Transfer Card and save ${{ computedData.btMaxSavings.savings | withCommas }} by computedMonthlyPayment”>increasingdecreasing your monthly payment by ${{ computedData.btMaxSavings.monthlyChange | withCommas }}.
You would actually pay more overall by using a Balance Transfer Card.
If you pay the same amount (${{ computedData.btSameMonthlyPayment.monthlyPayment | withCommas }}) each month, it will take you {{ computedData.btSameMonthlyPayment.payoffTime }} total month 1″>s <span v-if="computedData.btSameMonthlyPayment.payoffTime (* {{ computedData.btSameMonthlyPayment.payoffChange }} month 1″>s less) computedData.current.payoffTime”>(* {{ computedData.btSameMonthlyPayment.payoffChange }} month 1″>s more) (* same as current plan) to pay off your credit card balance of ${{ computedBalanceOwed | withCommas }}. Your total interest amount will be ${{ computedData.btSameMonthlyPayment.interestPaid | withCommas }}, and you will still save ${{ computedData.btSameMonthlyPayment.savings | withCommas }}. This assumes you do not make any additional charges during this period.
If you computedMonthlyPayment”>increase the amount you pay to <span v-else-if="computedData.btMaxSavings.monthlyPayment decrease the amount you pay to keep the amount you pay as ${{ computedData.btMaxSavings.monthlyPayment | withCommas }} each month, it will take you {{ computedBtIntroPeriod }} month 1″>s to pay off your credit card balance of ${{ computedBalanceOwed | withCommas }}. Your total interest amount will be ${{ computedData.btMaxSavings.interestPaid | withCommas }}. This assumes you do not make any additional charges during this period.
TIP
Based on the information entered, a balance transfer credit card would cost you more money in the long run. You may want to consider a personal loan instead.
Fee Disclosure: Some balance transfer credit cards may charge additional fees. These can include both annual fees and balance transfer fees. Check your card's terms and conditions for fee amounts. Your credit card will also have a balance transfer limit that restricts how much you can transfer. This limit should be listed in your cardholder agreement and will often be available by logging into your online account.

Balance transfer calculators show you how much money you can save with a balance transfer. They compare how much you'll pay in interest fees with your existing card versus a balance transfer card.
To use this balance transfer calculator, you'll need the following information:
Once you input the relevant data, the calculator will show you a cost comparison of the two cards. If you haven't chosen a balance transfer card yet, you can try different APR and fee amounts to see what works best.
You can also compare credit cards to see side-by-side comparisons of popular balance transfer cards to help you make your choice. When you've chosen a card, just click "Apply Now" to start the application process.
A credit card balance transfer is when you move the existing balance from one credit card account to another card account. Although you can't pay your credit card bill with a different credit card, you can effectively shift your credit card debt from one card to another.
Cards that will accept a balance transfer from another account are called balance transfer credit cards. Not all credit cards will accept balance transfers.
The simplest way to see if a card accepts balance transfers is to look for a balance transfer APR listed in the card's rates and fees table. Many balance transfer credit cards will charge the same interest rate for balances from both purchases and transfers, while others will charge a slightly higher rate for transferred balances.
For a balance transfer to be worthwhile, you'll want to transfer your balance to a low interest credit card or at least one with a lower APR than is charged by your current card. Otherwise, you won't save money on interest fees and the balance transfer will be pretty useless.
The very best balance transfer credit cards will offer intro APR deals that provide 0% interest on transferred balances. These offers are good for a set period of time after opening a new account. (You may also receive occasional APR offers on your existing credit cards, but these are less common and hard to predict.)
You can typically initiate a balance transfer while applying for a new card. Alternatively, you can perform a balance transfer online once your card account has been opened. You'll need to specify the account from which you want to transfer your existing balance, as well as how much you want to transfer.
Once you initiate the transfer, it can take several days for the debt to move from one account to another. If the due date for your outstanding balance occurs before the transfer is completed, be sure to make at least your required minimum payment to avoid late fees or other issues.
Learn more: How to do a balance transfer
Nearly all credit cards that accept balance transfers will charge a fee for the transaction, called a balance transfer fee. Most balance transfer fees range between 3% and 5% of the total transaction amount. For example, if you transfer $5,000 to a credit card with a 5% balance transfer fee, you will be charged a $250 fee for the transaction.
Some balance transfer credit cards will include a reduced balance transfer fee as part of its introductory APR offer. In most cases, you'll need to make the balance transfer within a set period of time — often the first 90 days — to be eligible for the introductory rate.
Balance transfer credit cards typically have limits on how much you can transfer. This limit may be the same as your overall credit limit, but some cards will have a specific balance transfer limit.
One thing to note is that the balance transfer limit will include your balance transfer fee. So, if you want to transfer a $5,000 balance to a card with a 5% transfer fee, you'll need to have a transfer limit of at least $5,250 on the balance transfer card.
Additionally, this limit applies to your total balance from all transfers; it is not a per-transaction limit. For instance, if you transfer $1,000, then later transfer another $1,000, you will need a card with a transfer limit of at least $2,000.
The cardholders most likely to save with a balance transfer credit card are those who can qualify for an intro 0% APR deal. The lower interest rate will mean more of your monthly payments go toward paying down your outstanding balance, rather than paying interest fees.
In general, you'll need good credit to qualify for a credit card with an intro APR offer. Cards with the longest introductory periods will require good or excellent credit.
If you can't qualify for a balance transfer credit card with a low interest rate — or you can't get a card with a high enough transfer limit — you may want to consider consolidating debt with a personal loan. Personal loans tend to have lower interest rates than most credit cards, which can help you reduce your monthly interest payments. Check out our guide to choosing between a balance transfer or personal loan.
There are several factors to consider when looking for a balance transfer credit card:
Using our balance transfer calculator can help you figure out what kind of APR and fee structure you might need to save the most money. This will narrow down your card options and make it easier to find the right card for you.
Please note that this calculator is not personalized financial advice and should not be considered or used as such. Nor are we promising that by use of this calculator, will you be able to save more money, preserve wealth, or otherwise.
Brittney is a credit expert and card strategist whose advice has been featured by major publications and financial sites across the web. A spreadsheet and data obsessive, she believes most problems can be solved with the right research, and she specializes in translating complex topics to educate and empower readers.
We’re firm believers in the Golden Rule, which is why editorial opinions are ours alone and have not been previously reviewed, approved, or endorsed by included advertisers. The Ascent does not cover all offers on the market. Editorial content from The Ascent is separate from The Motley Fool editorial content and is created by a different analyst team. The Motley Fool has a Disclosure Policy. The Author and/or The Motley Fool may have an interest in companies mentioned.
The Ascent is a Motley Fool service that rates and reviews essential products for your everyday money matters.
Copyright © 2018 – 2021 The Ascent. All rights reserved.
By submitting your email address, you consent to us sending you money tips along with products and services that we think might interest you. You can unsubscribe at any time. Please read our Privacy Statement and Terms & Conditions.

source

Leave a Reply

Your email address will not be published.