£8000k Stooze, to save of pay down mortgage

carlw

Hi All,

I have about £8000 on a 0% credit card Stooze, with about 14 months remaining at 0%.

I have used part of my ISA allowance already this year, so have about half left.

I also have a First direct 8% regular saver maxed.

My mortgage with NRAM is at 4.78% which i can over pay without penalty, and can at the banks discretion borrow back.

What is the best place for me to put this money to make the best return. Im obviously concerned that if i over pay my mortgage, NRAM may decide not to let me borrow the money back at the end of the 14 months, so i do not mind losing a little interest and not having this worry.

Many thanks.

HappyMJ

Why did you take it if it didn't have a destination planned for it? In my experience stoozes these days have run their course. I loved them in the days of higher interest rates and low or no fees but with BT fees of 3% it makes the savings minimal. It's too risky to pay the mortgage if it's "in the banks discretion" to let you borrow it back. Find a savings account that pays well. Do you have a partner whose unused ISA allowance you can use.

2sides2everystory

As a matter of interest (no pun intended ) did you incur a BT fee to get that £8,000 onto your card ??

If you did and paid 3% then you are already £240 down and playing catchup.

Perhaps you had a special deal with no fee?

More as an illustration to other interested readers than anything else, your FD 8% Regular Saver maxed out sounds good but can only yield a maximum of around £120 (after say 20% tax) in 12 months if you manage to keep it going.

Meantime, £8000 on your mortgage will have cost you around £450 over 14 months if the rate remains 4.78% and doesn't rise.

So, I agree that if you did overpay your mortgage that there might be a risk of you not being able to borrow it back when you need to repay your card but unless you do temporarily repay part of your mortgage with the £8000 I cannot really see how you will come out ahead short of putting some money on a winning horse

In short, it looks like you may have increased your total borrowings by £8,000 for no apparent reason or plan ?

If you did incur a 3% fee and you did nothing else now, then you'd end up £120 down. But if you now put the £8000 immediately into part repaying the mortgage and trust to being able to borrow it back (any fees for doing that?) then I reckon theoretically you could get back to break even in about 4 months.

Any other plan for the money is unlikely to get you back to break even as quickly as that.

And that all still assumes that you do not fall foul of the other risk of borrowing on promotional cc deals which is to inadvertently break the terms of your 0% deal through say a failed DD or late payment, and then end up catching an unexpected month or two's interest at 20%pa on £8000 ! (That would be a monumental minus £120 a month type mistake :eek:)

There are few opportunities to truly make stoozing work anymore and you really need to have it all well planned (including contingencies) in advance. FTP/PTF type thing.

carlw

I cant really see how this is really relevant, as i simply wanted to know where i could get the best return on 8k for 14 months. I said i was stoozing, simply to explain why it was only a strict 14 months. But here goes;

Im getting married in a few weeks, and had the final 8-10k to spend, which i have in a savings account. I decided rather than spend my savings, i may be able to make a few hundred quid if i got a 0% on spending card and paid the 8-10k off my mortgage. I checked my T&C and noticed this was risky, however thought 2-3% savings account would still make me enough to make it worth while. so.... I have 8k on the card, and i have not incurred any fees, in fact as its an M&S card ive maid about £50 in m&s vouchers already, if i cleared the balance tomorrow.

Now if anyone has any advice on the best place to save this money for the best return, i would be very grateful.

Carl

2sides2everystory

OK fair dinkum, carl, and best wishes for the upcoming main event :beer:


Getting married is an expensive business they tell me, and no doubt obtaining and preserving decent credit lines is a main priority. Sounds like you have exploited the 0% purchases deal nicely so far.

It was your use of the word "stooze" that made me think that "stooze" was the prime angle from the outset, but essentially it is just a question about the best place for your existing savings for 12 months or so before you rob Peter to pay Paul so to speak and have to pay back the 0% purchases balance with them?

We don't know your broad circumstances, but would this one be worth a play?: http://www.barclayswealth.com/international/savings/short-medium-savings-category/monthly-saver.htm

It is taxable but you could push £2,000 a month into it to get started quickly and have the interest credited monthly ... so after just 4 months the entire £8000 is earning 5% Gross ... not sure about how easy it is to reduce the monthly saved amount to say £100pm after 4 months, but AFAIK they don't clawback interest once it is paid and its just a question of adjusting the standing order.

Not sure on the qualifying criteria for an account but I am sure its not too onerous.

carlw

2sides2everystory wrote: »

OK fair dinkum, carl, and best wishes for the upcoming main event :beer:


Getting married is an expensive business they tell me, and no doubt obtaining and preserving decent credit lines is a main priority. Sounds like you have exploited the 0% purchases deal nicely so far.

It was your use of the word "stooze" that made me think that "stooze" was the prime angle from the outset, but essentially it is just a question about the best place for your existing savings for 12 months or so before you rob Peter to pay Paul so to speak and have to pay back the 0% purchases balance with them?

We don't know your broad circumstances, but would this one be worth a play?: http://www.barclayswealth.com/international/savings/short-medium-savings-category/monthly-saver.htm

It is taxable but you could push £2,000 a month into it to get started quickly and have the interest credited monthly ... so after just 4 months the entire £8000 is earning 5% Gross ... not sure about how easy it is to reduce the monthly saved amount to say £100pm after 4 months, but AFAIK they don't clawback interest once it is paid and its just a question of adjusting the standing order.

Not sure on the qualifying criteria for an account but I am sure its not too onerous.

Thanks very much, that looks like exactly what i am looking for, ill read through the terms and conditions more thoroughly and then look at opening an account.

HappyMJ

carlw wrote: »

Thanks very much, that looks like exactly what i am looking for, ill read through the terms and conditions more thoroughly and then look at opening an account.

You need £10,000 to invest or have an annual income in excess of £50,000 to avoid the £5 monthly fee.

carlw

HappyMJ wrote: »

You need £10,000 to invest or have an annual income in excess of £50,000 to avoid the £5 monthly fee.

Ok thanks for that, back to the drawing board then. I could use my wife to bes unused ISA allowance and whats remaining of my allowance if there are no better options.

Biggles

carlw wrote: »

£8000k Stooze, to save of pay down mortgage

Jeez, I was wondering which card you had an 8 million quid stooze with so that I could get out quick if it was one of mine!

Relieved to see it's only £8,000.

2sides2everystory

You need £10,000 to invest or have an annual income in excess of £50,000 to avoid the £5 monthly fee.

How about open a Halifax Reward current account and push £2005 a month through it to Barclays Wealth to qualify for Halifax's free fiver a month ... then you're home free

Edit: Well spotted Biggles ! I hadn't noticed that either. Just imagine the interest if you mess up a promotional deal on £8M :eek:

middlepuss

Biggles wrote: »

Jeez, I was wondering which card you had an 8 million quid stooze with so that I could get out quick if it was one of mine!

Relieved to see it's only £8,000.

The £8000K caught my eye as well. I thought if we have someone who is dealing in that sort of amount I'd come in and ask for some investment advice!