Balance Transfer Savings Calculator

What this tool calculates

A balance transfer card moves an existing card balance onto a new card that charges a low or zero promotional rate for a limited period, in exchange for a one-off transfer fee. This calculator runs a full month-by-month amortisation for both options (staying on the current card at its standard rate, or transferring to the new card at the promotional rate) using the same monthly payment in both scenarios. The result is the net interest saved (or net extra cost incurred) once the fee, the promo period, and the rate that applies after the promo are all included.

How the simulation runs

For the stay scenario, the calculator applies the current monthly rate to the running balance, adds the monthly payment, and repeats until the balance reaches zero. The total interest accrued across those months is what staying costs. For the transfer scenario, the upfront fee is added to the principal, the promotional rate applies for the promotional months, and once that period ends the rate reverts to the original card's rate. That revert assumption is the calculator's, chosen so the comparison has a defined baseline; a real offer sets its own revert rate and discloses it separately.

Both scenarios use the same monthly payment, and both accrue interest before the payment lands each month. The simulation stops at the first month the balance reaches zero. The payment that month is capped at whatever is left, so on the sample figures the last payment is 35.72 on the stay side in month 26 and 44.70 on the transfer side in month 22, rather than the full 250. Interest accrues before the payment lands, so the cap changes neither the month count nor the interest total; what it changes is the amount handed over in that final month.

What moves the savings figure most

Measured at the figures this tool opens with, nudging each input up by one percent of its own value: the balance moves the saving by 2.5%, the current rate by 1.8%, and the monthly payment by 1.5% in the opposite direction. The transfer fee moves it by 0.16% and the promotional rate by 0.15%. The promotional window only moves in whole months, and one month more is worth 0.07%.

That ordering is not fixed, and the window is the input whose weight swings furthest: one month less costs 0.48% of the saving against the 0.07% one month more is worth. What the window acts on is the Residual Balance at Promo End row. At these figures the residual is 0.878% of the balance, so there is almost nothing left to revert and the window has little to work with. At a monthly payment of 150 the residual reaches 43.9% and the money one month of window moves rises from 4.73 to 51.41. As a share of the saving that weight peaks near a 53% residual and eases off past it; in currency it keeps climbing.

What decides whether the window matters is where the transfer's payoff month falls against the window length. A residual left over is the visible version of that, and it is not the only one: at a monthly payment of 260 the transfer clears in month 21, the Residual Balance at Promo End row reads zero and Cleared Within Promo Period reads Yes, yet one month less of window still costs 1.40. That last month's interest is charged at the promotional rate under a 21-month window and at the current rate under a 20-month one. Only when the payoff lands before the final promotional month, at a payment of 265 or above here, does a shorter window cost nothing at all.

Where the balance does clear inside the promotional window, the cost on the transfer side is the fee plus whatever the promotional rate itself accrues. That second part is only zero at a 0% promotional rate: at the 3% default, with the window extended to cover the whole payoff, interest still comes to 144.00 on the sample figures against a fee of 150.00.

How to read the secondary outputs

The panel breaks the comparison into its parts: the transfer fee, the total interest under each scenario, the months each takes to clear, whether the transfer cleared inside the promotional window, the rate applied after it, and the balance still outstanding when the window ends. The break-even row states how many months of interest at the current rate would cover the fee, using the first month's interest as the measure, so it reads as a rough payback period rather than an exact one; interest accruing at the promotional rate on the transfer side is not netted off it.

Where the simulation simplifies

The calculation assumes a steady monthly payment, no missed payments, no new spending on either card, and a revert rate equal to the current card's rate once the promotion ends. A real offer sets its own revert rate, may charge fees the model does not carry, and may apply payments across balances in an order of its own choosing. What the tool produces is a clean comparison of two paths under steady conditions, not a forecast of any particular account.

Where to look next

For a balance being paid down on the current card without a transfer, the Minimum Payment Credit Card Trap Calculator shows what happens when only the minimum is paid. The Debt Consolidation Calculator runs a comparable comparison for unsecured loans rather than card transfers.