Calculations help
gollum007
Forumite Posts: 300
Forumite
OK, so I'm not sure on this, can someone check my figures please?
I've got a balance of £500 (Approx) on a card which I took out for new spending last year.
This £500 is sitting in my ISA, earning 3% tax free. The interest free period ends in January.
My other card (Barclaycard) keeps offering to me an 18months 0% deal, which will charge 3.9% BT fee.
The stoozing calculator gives me a return of £22.67 over the 18monhts period.
A simple 3.9% of £500 is £19.50, giving me a few quid further in profit.
Do these sums make sense? I want to make sure I haven't overlooked anything stupidly obvious:)
I've got a balance of £500 (Approx) on a card which I took out for new spending last year.
This £500 is sitting in my ISA, earning 3% tax free. The interest free period ends in January.
My other card (Barclaycard) keeps offering to me an 18months 0% deal, which will charge 3.9% BT fee.
The stoozing calculator gives me a return of £22.67 over the 18monhts period.
A simple 3.9% of £500 is £19.50, giving me a few quid further in profit.
Do these sums make sense? I want to make sure I haven't overlooked anything stupidly obvious:)
0
Comments

If they charge interest on the BT fee that could reduce the margin further.
If you always max your ISA allowance then the tax free advantage on the £500 will be lost forever as you can only put it back into an ISA by using part of the current years allowance.0 
I don't think this is worth bothering over for £2 profit, potentially less if you aren't careful. Just.. don't have a coffee one morning or something.
If you got a 24 months 0% deal with a 1% min payment and 1.5% fee, then that might be worthwhile.0 
Cheers, it wasn't so much the rate or the exact figures, but rather the nagging feeling I'd missed something (3.9% is more than 3%.....)
I'm not moving it at present and haven't researched deals, but I've never really tried a stooze0 
Don't forget that you'll need to repay part of the balance each month. While the repayment money might not come directly from the £500 in your ISA, it's less new money you'll have spare to add to the ISA.
I've been drafting a stoozing calculator of my own, and it has come up with the following figures, assuming a repayment of 1%/min £5 or £25, as many cards are...
It might still need a little tweaking, but based on a reducing balance, it gives a total interest earned of £13.29 with £25pcm payments, or £21.05 based on £5pcm payment (I was going to post the figures but the table keeps messing up ).0 
Cheers, it wasn't so much the rate or the exact figures, but rather the nagging feeling I'd missed something (3.9% is more than 3%.....)
Yes, it can seem a bit weird due to the different timeframes, ie 3% is per year. If you split the percentages by month, 3.9% over 18 months is 0.216667% per month, while 3% over 12 months is slightly higher 0.25% per month.
However, as my example above, the actual calculations aren't as simple as that, as you're paying the BT fee up front whilst the ISA interest is on a theoretically reducing balance.0
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