If you're carrying debt on a credit card that charges typical credit card interest rates, you may be paying hundreds or even thousands of dollars a year in interest. Moving that debt to a balance transfer credit card with a 0% introductory APR period could reduce your interest costs to zero. That not only can save you money, but also can allow you to get out of debt more quickly, since every dollar you pay will go toward eliminating your balance rather than paying interest.
Our credit card balance transfer calculator can give you a sense of how much money you could save by doing a balance transfer. Tell us how much debt you're carrying, the interest rate on that debt, and a couple of details about the balance transfer credit card you're looking at, and we'll estimate your potential savings.
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Where to find information for the calculator
Existing debt: Credit card debt to transfer
Your monthly credit card statement will show you how much you currently owe. You can also find it by logging into your account online. Make sure to enter the card's balance, rather than the current minimum payment (which is often the more prominent number on your statement).
Existing debt: Interest rate
The interest rate, or APR, that applies to your account also appears on your monthly credit card statement. Look for a section labeled "Interest charges" or "Interest charge calculation." The rate charged on purchases made with the card is the "purchase APR."
Balance transfer card: Transfer fee
With only a few exceptions, every card will charge you a fee for transferring a balance to it. You can find the balance transfer fee for any credit card in the Schumer box, a table of rates and fees that card issuers are required to make available to people applying for the card. On the web, the marketing page for a credit card will typically have a link to the Schumer box, labeled something like "See rates and fees" or "See terms." Balance transfer fees are typically a percentage of the amount transferred, and there's usually a minimum fee. For example, the fee might be described as "3% of the amount transferred, or $10, whichever is greater." For simplicity, our balance transfer calculator uses just the percentage fee; unless you're transferring only a few hundred dollars in debt, you'll be paying more than that minimum dollar amount.
Balance transfer card: 0% intro APR period
The number of months in the 0% introductory period will also be listed in the Schumer box. Look for a section labeled "Annual percentage rate (or APR) for balance transfers." It will tell you how many billing periods you get at 0% before the APR on transferred balances resets to the regular rate. If a portion of the balance is still unpaid at the end of the intro period, you'll be charged that rate going forward.
How to understand the calculator results
The results you get from the credit card balance transfer calculator are an estimate of how much you could save if you moved your debt to a card with a 0% offer for balance transfers, compared with what you'd pay if you left the debt where it is. The results are based on two assumptions:
1. You'd pay off the debt within the 0% intro APR period on the balance transfer card.
Say the card you're looking at offers 18 months of 0%. Our balance transfer calculator uses this as the time frame for estimating costs. In other words, you'll either:
Leave the debt on your current card and pay it off over 18 months, or
Move it to the 0% card and pay it off over 18 months.
The calculated savings is the difference between these two.
2. You'd pay off the debt with equal payments over that period.
When you're paying off debt on a card that's charging you interest, your repayment schedule has a huge effect on the total amount of interest you pay. The more you pay each month, the less you'll ultimately be charged in interest and the faster you'll eliminate the debt. For example, say you're starting with $3,000 in debt on a card that charges 16% interest:
If you paid this much each month ... | You'd be charged about this much in total interest ... | And you'd pay off the debt within ... |
|---|---|---|
$1,400 | $65 | 3 months |
$500 | $148 | 7 months |
$190 | $390 | 18 months |
$120 | $674 | 31 months |
There are countless ways you could choose to pay down your debt. You could pay an equal amount each month (the scenarios in the chart above), or you could pay a variable amount based on what you have available. You could pay once a month or multiple times a month. You could even just pay the "minimum amount due" shown on your statement, which will keep your account in good standing but can also keep you in debt for years.
No calculator can account for every single potential payment option. Our balance transfer calculator, therefore, assumes that your payment will be the same every month and that it will be the exact amount necessary to pay off the debt within the time frame.
Where can people run into trouble with a balance transfer?
The cost of debt without a balance transfer
To give you a better sense of the cost of carrying credit card debt without doing a balance transfer, we've created a second calculator that tells you exactly how much you would need to pay every month to eliminate your debt within a given time frame.
This isn’t as simple as dividing your debt by the number of months in the repayment period. If you have $1,000 in debt, for instance, paying $100 a month for 10 months won’t get you in the clear, because you'll be charged interest. At 16% interest, you'd have to pay $107.48 a month to completely eliminate the debt in 10 months.
Tell us how much debt you have, the interest rate on that debt and how many months you'd need to pay it off, and we'll tell you your required monthly payment, the total amount of your payments over your time frame and the total amount you'd pay in interest.
How do balance transfers work?
A balance transfer provides the answer to a common question: "Can I use one credit card to pay off another?" When you request a transfer, the bank that issued your new credit card sends a payment on your old card and then adds that amount to the balance on the new card, along with the balance transfer fee. You can sometimes request a transfer at the time you apply for the new card; you can also call the issuer after you get the card, or use a convenience check.
What to look for in a balance transfer card
Balance transfer cards generally work the same way. The key differentiating factors are:
Balance transfer fee. This fee will typically be 3% to 5% of the amount transferred, which translates to $30 to $50 per $1,000 transferred. The lower the fee, the better, but even with a fee on the high end, your interest savings might easily make up for the cost.
Length of 0% introductory period. A good balance transfer credit card will have a 0% period of 15 months or longer. Some give you close to two years at 0%. You might not need that much time, but the longer the 0% period, the more flexibility you have.
Card issuer. As a general rule, you can't transfer debt between cards from the same issuer. If your current debt is on a Citi card, you can't transfer it to another Citi card. You can't transfer debt from one Wells Fargo card to another, and so on.
Rewards. It's worth thinking about what you're going to do with your balance transfer credit card down the road, after you've paid off your debt. Many balance transfer cards don't offer a very compelling reason to keep using them after the 0% period runs out — they offer no rewards, and their ongoing interest rates aren't particularly low. However, a number of excellent rewards credit cards offer balance transfer promotions of 15 to 18 months.
Below are a few credit cards rated as among the best for balance transfers by our editorial team. For other options, see NerdWallet's best balance transfer credit cards. That list includes "pure" balance transfer credit cards with extra-long 0% intro periods, as well as rewards cards with solid balance transfer offers. You can apply for most of these cards directly from NerdWallet.
