Money Transfer from CC and Invest in Savings

infinityx

Hi All my cc which i haven't really used since the interest free purchase period ran out last year, sent me an email allowing a money transfer of 2.5% until end of June 2024. Is it OK to take this deal then put the money in a high paying interest account? or is there other implication i am not thinking of e.g. credit score impact or fees. I have never done this before. I cannot understand why cc would give a money transfer for such a low rate unless there is some catch.

Alex9384

It's totally OK. It's called stoozing. I'm doing it too.

I currently have over 23k transferred from two credit cards into saving account.

Wanted to do one more, but they ramped up the transfer fee, so I'm going to wait.

2.5% is a very good offer at the moment. Mine were above 3%, though a bit longer zero period than yours. The bank is hoping you won't pay off the full balance before the zero period runs out, so they will charge you some interest.

Credit "score" in the UK is a made up number that doesn't matter. It will go down temporarily, but you don't need to worry about it. Only care about your credit history. You will need to make at least minimum payment to your credit card(s) every month (anywhere between 1% and 3% of the remaining balance), so keep it in mind when planning your monthly budget. Other than that, nothing to worry about.

Brie

As long as you have a way to make the minimum monthly payments in the meantime.  And set up a DD to do so just to ensure you don't forget and lose your 0% rate.  

I've done similar over the years when the fee worked out to less than the rate on my flexible mortgage.

fatbelly

There's still a stoozing board, guys. At least till Tuesday.

housebuyer143

You are better off to get 0% on purchases for 24 months or what have you and put all your spending on it until it's maxed out. Then the money you have saved from putting your spending on the card goes into your savings. 
No fee then and pure profit. 
My husband and I are £35k maxed on the cards but making a nice chunk in the bank.

Brie

fatbelly said:

There's still a stoozing board, guys. At least till Tuesday.

Yes - but some people don't know that's what they are asking about until they get a few answers. 

(Hopefully Tuesday won't change toooooo much here.)

vacheron

Yes, this is stoozing. I have 82K sitting in my account earining interest that the banks have lent me at 0% and which I am earning 4-5%. 

Even better is when you are getting savings interest from the the same bank that lent you the free money from their own credit card in the first place! 

infinityx

Another question If i do a money transfer of 6k from one CC at 2.5%fee balance payable 30 June 2024, can I balance transfer to the second credit card with a max limit of 10k which has a 0% promotion for 22 months at a 2.99% fee. so although I pay 5.5% it would be across 21/22 months (I just got the card) vs having to pay back 6k after 11 months since we are already in July.. 

Im just not sure I can find things to spend 10k even with energy bills in 60 days lol i mean it would be pretty odd to put 2k let alone 5k into the energy bill account. Im sure it would raise some red flags.

vacheron

Yes you can, I do the same, but use my Halifax clarity card which charges 6.9% interest on money transfers but with no money transfer fee. As the balance will only be on the money transfer card for a few days until it’s transferrred to he BT card, the interest charged is only a few pounds.

Also think about where you will keep the money to earn the best interest as the 0% BT periods appear to be selected to be just less than 12/24/36 months so you can’t lock the funds in a 1/2/3 year fixed savings accounts.

housebuyer143

infinityx said:

Another question If i do a money transfer of 6k from one CC at 2.5%fee balance payable 30 June 2024, can I balance transfer to the second credit card with a max limit of 10k which has a 0% promotion for 22 months at a 2.99% fee. so although I pay 5.5% it would be across 21/22 months (I just got the card) vs having to pay back 6k after 11 months since we are already in July.. 

Im just not sure I can find things to spend 10k even with energy bills in 60 days lol i mean it would be pretty odd to put 2k let alone 5k into the energy bill account. Im sure it would raise some red flags.

It might be you need a different card to do the purchases but if you put all your food, petrol, general spends etc you will be surprised how quick your can max a card 🤣 it does generally take a few months but it's worth it to me to not have to pay a fee for the cash. 

infinityx

housebuyer143 said:

infinityx said:

Another question If i do a money transfer of 6k from one CC at 2.5%fee balance payable 30 June 2024, can I balance transfer to the second credit card with a max limit of 10k which has a 0% promotion for 22 months at a 2.99% fee. so although I pay 5.5% it would be across 21/22 months (I just got the card) vs having to pay back 6k after 11 months since we are already in July.. 

Im just not sure I can find things to spend 10k even with energy bills in 60 days lol i mean it would be pretty odd to put 2k let alone 5k into the energy bill account. Im sure it would raise some red flags.

It might be you need a different card to do the purchases but if you put all your food, petrol, general spends etc you will be surprised how quick your can max a card 🤣 it does generally take a few months but it's worth it to me to not have to pay a fee for the cash. 

Yes i'm sure a few other things will pop up and I was thinking of moving another balance of 2k on a different credit card onto this one since the interest free period for that runs out in Oct/Nov. but would be good to have an extra 19/20 months but i wonder if I do a money transfer from my other card then balance transfer to clear the balance will they offer me another money transfer for 12 months in the future (one can wish)

Thank's for all the advise it have been pretty eye opening. i wish i knew about this ages ago lol

Note: I am looking at other threads to see which savings account to put the money.