How this calculator works
A balance transfer moves a card balance to a new card, often at a promotional rate for a limited period. The new card charges a transfer fee, usually a percentage of the amount moved, which is added to the balance. During the promotion only the promotional rate applies, and after it ends the standard rate takes over on whatever remains. Because the same payment is made in both scenarios, the comparison shows how much the lower promotional rate saves once the fee and the post-promotion rate are included. The model assumes no new purchases, no minimum-payment changes and that the full balance is paid by the end of the horizon.
Formula
Transfer fee = balance × fee percentage. New balance = balance + fee. Each month on the new card: rate = promotional rate / 12 during the offer, then post-promotion rate / 12; interest = opening balance × rate; payment reduces the balance by the payment minus interest. The current card uses its own monthly rate. Saving = interest on the current card - interest on the new card.
Worked example
Transferring $8,000 at a 3% fee creates a $8,240 balance. Paying $250 a month on the current card at 21.99% clears it in 49 months with $4,154.98 of interest. On the new card, the first 12 months at 0% bring the balance to $5,240; after that, 19.99% applies. It clears in 38 months with $1,259.11 of interest, so the transfer saves $2,895.87 and 11 months.
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Frequently asked questions
Does the transfer fee count as interest?
It is a cost of credit even though it is not labelled interest. It is added to the balance, so you also pay interest on it during the promotional period unless that rate is zero.
What happens if the balance is not cleared when the offer ends?
The post-promotion rate applies to the remaining balance. Set that field to the card's standard rate so the estimate reflects the true cost.
Do new purchases cost more on a transferred card?
Often yes. Many cards charge the standard rate on new purchases from the day of the transaction and may also apply payments to the promotional balance first. This model assumes no new spending.
Will a transfer affect my credit score?
Opening a new account and the inquiry can lower a score briefly, while lowering utilization on the old card can help. The net effect depends on your other accounts.