To get a better idea of how balance transfer cards can help, check out our handy debt repayment calculator to see if a balance transfer card works for you. After, you can take a look at our examples of debt repayment to see how it compares to other options.
Balance transfer repayment calculator
How to use this calculator
- In the Card #1 line, fill in your current credit card’s balance and APR. If you’re transferring from multiple card accounts, you can add additional balances by clicking the Add another card button.
- If you know your balance transfer card details, fill those out in the next section to see how much you’ll save. We’ll input some default values for you if you don’t have a specific card in mind.
- After you input card details, you’ll see see the monthly repayment bar which offers our recommendation for how much you should pay each month. You can slide this bar left and right to adjust your monthly payment.
- Below this bar, you’ll see how long it will take to pay off your debt with and without a balance transfer. This calculation is based on your card details as well as your desired monthly repayment. You’ll also see how much you’ll save with a balance transfer below that.
How much should I pay monthly toward my debt?
After you input your card information, you’ll see a dollar amount under Your monthly repayment. This is the amount to pay monthly toward your new card’s balance if you want to pay off your balance before the intro APR expires.
You can adjust the slider to see how long it’ll pay off your debt with different monthly payments. If you want to pay the lowest fees and interest, we recommend keeping the slider in the green area.
How does this balance calculator work?
Here’s what the calculator is doing behind the scenes:
- First, it adds all your existing card balances.
- Then, it adds the fee you’ll pay for a balance transfer to the new card, as well as the new card’s annual fee.
- Finally, it takes that total and divides it by the length of your new card’s intro APR.
If you were to do the math by hand, you’d use this formula:
See more: Here’s an example
You have two cards, each with a $1,000 balance. In total, you have $2,000 in credit card debt.
- You want to move that debt to another card via balance transfer. This has a 3% fee, which comes out to $60. The card also has a $95 annual fee.
- So, the balance on your new card is $2,000 + $60 + $95 = $2,155.
- The card has a 0% intro APR for 15 months. Ideally, you’ll want to pay off your balance before that expires. To that end, the calculator will show a recommended monthly payment of $143.67.
Compare balance transfer offers
How much money will I save by doing a balance transfer?
The amount you’ll save depends on several factors, such as:
- The size of your debt.
- How much you want to pay on your credit card bill each month.
- The introductory APR that comes with your balance transfer credit card.
The longer you keep your debt, the more you might save by switching to a balance transfer card. That’s because the card may offer 0% intro APR for a significant period, giving you a long break from interest.
Basically, you save money by paying far less interest for a specific time. The savings are reduced by any balance transfer fees or annual fees, but they can add up.
Compare a balance transfer to your other options
If you have debt you need to pay, you have options. One of those options is to continue paying your debt at the same rate you are paying now. Let’s compare two options to a balance transfer credit card — continuing on the same path, or getting a personal loan.
With all examples, assume you currently have a $5,000 balance with a credit card that has an 18% purchase APR.
Option #1: Get a balance transfer credit card
With the best balance transfer cards, you’ll get a 0% intro APR on transferred balances for a long period of time.
Let’s say you apply for and are approved for the U.S. Bank Visa® Platinum Card, which offers a 0% introductory APR on balance transfers for 18 billing cycles after account opening. After that, the ongoing APR is 18.74% to 28.74% variable.
- You transfer your $5,000 balance to the U.S. Bank Visa® Platinum Card. You pay a transfer fee of 3% or $5, whichever is greater. In this case, 3% of $5,000 would come out to a transfer fee of $150.
- You get a 0% intro APR on your balance for 18 billing cycles.
- You pay $257.50 a month toward your balance.
Here are the results:
- You’ll pay off your debt in 20 months.
- You’ll pay $5,250 total — $5,000 in debt, $150 for the balance transfer fee.
- Compared to paying off your credit card debt at the original rate, you save $804.
Option #2: Pay off your debt at the same rate
Among a sea of choices, making no change is certainly an option.
Let’s say your situation is as follows:
- You have a $5,000 balance on your credit card.
- The balance comes with an APR of 18%.
- You’re paying $250 a month toward your balance.
Here are the results of that strategy:
- You’ll pay off your debt in 24 months.
- You’ll pay $5,989 total — $5,000 in debt, $989 in interest.
There may be a better option that could save you from paying quite as much in interest.
Option #3: Get a personal loan
Instead of paying off your credit card debt the old-fashioned way, you could take out a personal loan. A personal loan gives you a set amount of cash up front that you can use to pay off your credit card, then you would pay off the loan over time.
If you get an interest rate on the loan that’s lower than the rate you’re paying on your credit card, you can consolidate and pay off your debt slightly faster and more cheaply.
Here’s an example:
- You take out a $5,000 loan, then pay off your credit card with that loan.
- Your loan comes with a 14% APR.
- You continue to pay $250 a month toward your debt.
Here are the results:
- You’ll pay off your debt in 23 months.
- You’ll pay $5,727 total — $5,000 in debt, $727 in interest.
- Compared to paying off your credit card debt at the original rate, you save $262.
If you need a break from high interest rates, a balance transfer credit card might help. By taking advantage of 0% introductory APRs, you can pay off your debt and slow the pace of interest accumulation.
Try to apply for a balance transfer card with good credit, as your chances of approval will increase.
As with any debt repayment plan, it’s best to compare all of your options before making a decision that works best for you.
Frequently asked questions
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