BT question

Ems112

My Halifax CC with 0% on purchases is coming to an end next month. I have the money in an ISA to clear the CC debt of around £3,500 but I am wondering whether I would be better off finding a balance transfer card (i.e. the NatWest BT card for 13 months with a 1% fee) rather than paying off the debt with the ISA money (which at the moment is earning me 3.10% interest). Does this work? Am I missing something crucial? Thanks

[Deleted User]

is the 3.1% on the isa inc a "bonus"usually for the first year?and if so when does it revert to less than that?
i might be a close call

grumbler

Ems112 wrote: »

Does this work? Am I missing something crucial?

Yes, it does, especially if 0% is longer than for 12 months and you want to add more than £5940-£3000=£2940 to your ISA in the next financial year.

Ems112

Yes, pretty sure there is a bonus included in that rate although I will switch the ISA as soon as the bonus comes to an end so assuming that I can get a rate greater than 1% it still works, yes?

grumbler

This depends on the fee you pay for the BT. If it's, say, 3% and 18 months you break even if you are getting about 2% net on your savings.

Gurranes

Remember you can also transfer your ISA to another bank/BS if the rate falls, or even to a stock & sahres ISA. But once closed, you will never be able to use that ISA allowance again (i.e. to build up a pot of tax free savings of time).

Long term vs short term - Will you be able to clear the debt down or will you be transferring it round.