the new egg money card

M_Thomson

CopperPlate wrote:

Well, after all my prevarication before, Egg paid not one blind bit of notice to me asking to cancel my application. My cards arrived on my doormat this morning...:D

Phoned them and they confirmed that the account had not been cancelled...so I suppose I will give it a go. Will use a savings account to store the money I'll use to pay the card off at the end of the month and that way, hopefully, get 4.5% on a balance for the whole month AND earn myself 1% cashback at the same time.

Who said I was fickle...

CP

It is 4% not 4.5% interest on credit balances.

YorkshireBoy

M_Thomson wrote:

It is 4% not 4.5% interest on credit balances.

I was confused with CopperPlate's post as well, but on reading it again it seems he is going to keep the money for paying the card off at the end of the month in a separate account for the extra 0.5%. Perhaps he'll clarify his post?

Rafter

Asked this earlier on, but haven't found an answer yet......

If you deposit say £500 on 1 October and then buy an item costing £400 on 2nd October, presumably you only earn interest on £100 during October?

If however you had a separate credit card and savings account you would earn money on the whole £500 and have ~50 days interest free credit on your credit card.

I suppose this is how they are going to make the product make them some money but seems a bit sneaky as effectively they are trying to get customers to pay for their credit card purchases in advance and Egg is saving interest on the interest free credit it had to offer before.

Can anyone confirm?

R.

charlie12

Rafter,

Egg money still has the standard (50-odd day) interest-free period like most other cards. Therefore you can make purchases as normal without preloading and you won't get charged interest as long as the balance is paid in full every month. So you can still keep all your funds in a savings account earning interest until it's time to pay off the card.

I only see the preloading an advantage when buying goods that exceed one's credit limit, or to use as a temporary savings account/stooze pot.

CopperPlate_2

YorkshireBoy wrote:

I was confused with CopperPlate's post as well, but on reading it again it seems he is going to keep the money for paying the card off at the end of the month in a separate account for the extra 0.5%. Perhaps he'll clarify his post?

Yes, sorry wasn't very specific. THe money is going into an Egg savings account to be transferred at the end of the month. That way I get 4.5% (before tax) on the full amount rather than 4% on a decreasing balance (for all the difference it will make ) I am right in saying that the interest will be applied to your decreasing balance on the CC? If you preload with £1000 and start spending until you get it down to 0 by the end of the month, is the interest calculated daily or on the average balance over the month? Who said new innovations were simple?

CP

CopperPlate_2

Charlie12 you're quite right. With my dismal credit limit, I'll probably need to preload cash onto it - I'm redecorating just now and have my eyes on some v nice things (unfortunately they are also not v nice prices, but who cares?) - now all I have to do is put m'darling wife off buying it all until the 2% cashback dates...

CP

CopperPlate_2

Rafter wrote:

Asked this earlier on, but haven't found an answer yet......

If you deposit say £500 on 1 October and then buy an item costing £400 on 2nd October, presumably you only earn interest on £100 during October?

If however you had a separate credit card and savings account you would earn money on the whole £500 and have ~50 days interest free credit on your credit card.

I suppose this is how they are going to make the product make them some money but seems a bit sneaky as effectively they are trying to get customers to pay for their credit card purchases in advance and Egg is saving interest on the interest free credit it had to offer before.

Can anyone confirm?

R.

My brain hurts after thinking about this one Rafter.

Rafter

Well,

Based on what charlie says, use it as a cashback credit card or as a savings account but don't mix the two - otherwise you miss out on interest free credit.

R.

CopperPlate_2

Why do you miss out on the IFC? If you preload it and then spend in excess of the preloaded amount are you charged interest on the amount of credit you use regardless of whether you clear that remaining balance in full when the statement is produced?

CP

Caped_Avenger

Rafter wrote:

Asked this earlier on, but haven't found an answer yet......
<see 7 posts up>
R.

That's the impression i get. A very clever piece of marketing, IMO.

OK, done some digging. Direct from the FAQ at egg.com:

How is my interest on a positive balance calculated?
It's calculated on a daily basis on any positive balances.

So, as you say, if you credit your card with £500 on 1st October, make a £400 purchase on 2nd October (and nothing else for the rest of the month), you will only get 1 day worth of 4% interest on the £500, and the rest of the month you will only earn 4% interest on £100, which is the equivalent of less than 9 days at 4% interest, if you look at it that way.

Compare that to putting £500 into an ING account on 1st October, transferring it back to your current account on (say) the 7th November, you will have received 4.75% on the full £500 for 37 days, and then pay the £400 outstanding debit on the egg money card before the due date, and you incur no debit interest.

So, if you have the discipline to do it, you'll be far better off by doing things that way.