Stoozing Query

Cotta

BSMS,

Thanks again for your help. It's hard to see if I would benefit much from this process, the extra funds being unlocked would be useful, however I'm still not clear on exactly what is the best fit.

E.g. I've no debts and just a mortgage that allows 10% overpayments. I spend about £100 on the debit card each month, is this perhaps my avenue?

zacchaeus_2

Cotta wrote: »

E.g. I've no debts and just a mortgage that allows 10% overpayments.

Unless it's a flexible mortgage, like an offset one or one that effectively gives you a variable borrowing facility, the possible danger is not being able to get the money back when you need to repay the stooze credit card. Unless you're able to roll over the credit card debt onto another 0% balance transfer (which is never guaranteed due to changes in the market and/or your personal circumstances), or you have another pot of cash you can tap into in an emergency, you may suddently hit a cashflow brick wall and have to remortgage, take out a loan and/or start incurring hideous credit card interest charges. Any of these would be likely to wipe out your stooze income almost instantly.

Sorry if that sounds a bit gloomy...

(As an aside, I forgot to mention above that an advantage of the offset - or similar - mortgage trick is that you don't pay tax as you would if using a savings account.)

Cotta wrote: »

I spend about £100 on the debit card each month, is this perhaps my avenue?

Potentially, but you'd have to be pretty patient. You'd be stoozing £1200 the first year. If my arithmetic is right then, assuming you:

• went down the mortgage route;
• pay 4% mortgage interest;
• are able to keep rolling over the credit card balance (wih assumed 1% BT fees on 1-year 0% periods) to avoid the pitfall described above; and
• don't run up against a credit limit;
• and that £1,200 is less than 10% of your remaining mortgage balance.

you'd save about £24 in year one, £56 in year 2, £92 in year 3, etc (add £36 each time).

Would it be possible, without going beyond your means, of course, to transfer more of your existing spending to credit cards than you currently spend with the debit card?