Things to do when you're bored and like spreadsheets...

lazy&indebt

Ok so I've just decided to take Morgan Stanley up on their long term, low interest balance transfer offer, the offer sounds excellent, just 1% fee and you only pay 3.9%apr on your balance for that term...(when it reverts to 15.9% I think - correct me if I'm wrong)
EDIT - The 3.9% offer lasts for 40 months

So I'm transferring £2,270 and (as I have way too much free time on my hands) I decided to use my useless knowledge of spreadsheets to work out just how much I needed to pay each month in order to clear the balance, at least by the time the 3.9% offer runs out. So I added on my 1% fee and I got:
£2,292.70
I divided this by 40 (months) and got:
£57.32
Finally, I worked out how much interest I would be charged each month over the 40 months by doing 3.9%APR divided by 12 months is 0.325% interest each month...I figured out I could pay it off in the 40 months by paying AT LEAST £57.32 each month plus 0.325 of the total balance (as interest) so for example , first payment will be £57.32 plus 0.325% of £2,292.70....a total of £64.77. Brilliant. I also sat and worked out it would take me about 6 months less if I paid £70 every month until the balance clears and I would end up paying a total of £135 in interest (compared with £152 in interest if I pay it off in 40 months) Great, I'll do that then.

Then, just for fun, I decided to see how long it would take me to pay off my balance if I paid the measley minimum of 2% each month...you ready for this...
28 and a half YEARS and a total of £2,109.48 in interest.

I know Martin always harps about not paying the minimum and trying to pay, even a few pound over the minimum every month but it never really sunk in until I just worked it out for myself.

I don't fancy repaying this debt until I'm 50 years old so I'll go with scenario B I think...

marvin

I bet Morgan Stanley only allow you a credit limit of £1000 until the promotional period ends and will only allow you to transfer £900.

Happened to me with more than, Texaco and Morgan Stanley (despite having had a card with Morgan Stanley before with a £6000 credit limit) all of which offered 3.9% on balance transfers.