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The best 0% balance transfer credit cards
The best 0% balance transfer credit cards
The best 0% balance transfer credit cards
Working out the best balance transfer credit card for you is not as simple as picking the card with the longest 0% period.
It’s easy to compare credit cards that offer interest-free periods on purchases. All you need to know is how long the 0% period is – the longest offer will be the best card you can get.
Things are a little more complicated with balance transfer credit cards as you have a transfer fee to take into account. This is a percentage of the debt that you are moving onto the balance transfer card. This is typically around 3%, but there are some quite significant differences between the leading cards.
Best balance transfer cards right now
To get an idea of these differences, here are the cards offering the longest 0% periods on balance transfers:
Card | 0% period | Balance transfer fee |
22 months | 2.9% | |
| NatWest Platinum | 22 months | 3.2% |
| Royal Bank of Scotland Platinum | 22 months | 3.2% |
22 months | 3.5% | |
21 months | 2.6% | |
| MBNA Platinum | 20 months | 2.85% |
20 months | 3% | |
| Nationwide Visa* | 20 months | 3.1% |
18 months | 3% | |
| Tesco Clubcard Credit Card | 18 months | 3.95% |
17 months | 3% |
*Not available to people who've cancelled another Nationwide credit card in the past 12 months
There are four cards offering 22 months interest free, but which one is actually cheapest when you factor in the fee?
It’s time for some maths!
Breaking down your debt
I’m going to take the top five cards above and calculate what you’d have to pay each month in order to clear the debt before interest starts being charged. I’m going to do this for a range of different debt sizes too, and include the transfer fee you’ll be charged with each:
Card | £1,000 debt | £2,500 debt | £5,000 debt |
£46.77 (£29 fee) | £116.93 (£72.50 fee) | £233.86 (£145 fee) | |
£46.91 (£32 fee) | £117.27 (£80 fee) | £234.55 (£160 fee) | |
£46.91 (£32 fee) | £117.27 (£80 fee) | £234.55 (£160 fee) | |
£47.05 (£35 fee) | £117.61 (£87.50 fee) | £235.23 (£175 fee) | |
£48.86 (£26 fee) | £122.14 (£65 fee) | £244.29 (£130 fee) |
What stands out to me is difference between the fees, particularly as the balance being transferred grows. If you go for the Halifax MasterCard rather than the Barclaycard 21-month Platinum, you’re forking out an extra £45 just for an additional month free of interest. That’s hardly small change.
Similarly, with the Halifax and Barclaycard 22-month cards, for an identical period of 0% interest, you’re paying up to £30 more!
Clearing the debt early
But what if you don’t need a full 22 months to clear that debt? What if you can afford the extra pounds each month that will allow you to clear that debt a bit early – 20 months, say?
At that point the fee becomes even more crucial. Indeed, you’ll actually pay less clearing your debt on the Barclaycard 21-month Platinum than you would on any of the other four cards.
Card | Total paid for £1,000 balance transfer | Total paid for £2,500 balance transfer | Total paid for £5,000 balance transfer |
£1,029 | £2,572.50 | £5,145 | |
| NatWest Platinum | £1,032 | £2,580 | £5,160 |
| Royal Bank of Scotland Platinum | £1,032 | £2,580 | £5,160 |
£1,035 | £2,587.50 | £5,175 | |
£1,026 | £2,565 | £5,130 |
So before you automatically apply for the longest 0% offer, take a minute to think work out what repayments you can afford each month and how long it will take you to clear the debt.
By going for what appears to be a middle-of-the-road card, you may actually manage to save a few quid!
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