OK, this isn’t on a scale with Colin’s issues recently but does relate back to something I posted ages ago. You know those useless bloody automatic answering services you get that ask you about every service except the one you want? Here’s another example.
I wanted to transfer a balance onto my TSB credit card. This is a "good thing" for them, obviously. They get me in more debt etc. So you’d think they’d make this easy.
First stop, online banking. Nope. Absolutely no mention anywhere of how to organise a transfer. Bit poo. OK, next stop, back of a statement. There’s a nice list of numbers there, so I picked the one I need – labelled "balance transfers" and called it. No problem.
Recorded message, voice recognition software (I hate that stuff) to determine where you want to go and then key in your card number, expiry date and date of birth. Use the keypad to select another option then get transferred to a different network with a different voice asking you to key in another option and then use voice recognition to finally ask to speak to an agent.
"Hello, how may I help you?"
"Hi, I’d like to transfer a balance onto my card please."
"Oh, you’ve called the wrong number…"
"Well, this is the number listed on the back of the statement."
She gave me the number I needed (office closed by then, so I’d have to ring back the next day) and promised she’d do something about reporting the mislabelled number on the statement. Yeah. Right.
Sometimes I wonder why I bother being a credit card whore, but – hey – it’s netting me a fair amount of interest in a nice savings account.
Here’s how – and all legal. Check around for a credit card that’ll give you cash as a balance transfer – that is, transfer into a bank account rather than just pay off another store card. MBNA do a few. Depending on your credit rating, you can get a few grand from this.
Take this money and drop it in a savings account that pays interest from day one. Make a very careful note of when your interest free period runs out. Set up a direct debit to pay the minimum amount off the card each month.
Sit and wait till about 2 months before the interest free period expires. At this point, shop around for another card that gives free balance transfers, though it can be just from other credit cards this time (note – cannot be from the same company as provides the original one). Get this, transfer the balance over from the original before the free period ends, note the new expiry date and watch the interest grow on your savings. Again, don’t forget to set up a DD to cover the minimum payments.
Repeat until the balance on the cards are paid off, you get bored, or you can’t get a card. Worst case is you can’t get another card that’ll cover the balance. Simple – withdraw the money from the savings account and use it to pay off the balance. You still keep the interest you’ve accrued.
You just have to follow some simple, golden rules:
1) Never touch the savings account except to pay off the card or skim off the interest. Always keep enough in there to pay the card off. Remember that they can end their interest-free promotion early if they want to and you’re obliged to pay it back
2) Pay very close attention to those dates and don’t forget to pay off the balance (either transfer elsewhere or pay it off with cash) well clear of the end date.
3) Always set up a DD to pay the minimum as soon as possible, and also make a manual payment for the first month just in case they take a while to apply it.
You can further complicate things – like I’ve done – by introducing other cards. The card I got that offers money into a bank account gives me 9 months interest free and a maximum credit of £3000. So I got myself another card with a 12-month interest-free period which accepts transfers from other cards. Simple procedure: get cash from card A, pop it into savings account, transfer balance to card B. Repeat 1-and-a-third times to fill up card B and then do one more transfer from A. Result – two cards maxed out, and ten grand in a high-interest savings account… All I’ve got to do is make sure small monthly payments are made and that I watch my calendar in a few months!
They are catching on to this, so watch out as many charge a fee for the balance transfer in the first instance.
Another method is to get one of the cards offering interest-free on purchases for n months. Halifax do one, as do other places. Again, set up the direct debit for the minimum payment and each month transfer the difference between the minimum and outstanding balances into your savings rather than using it to pay the card off.
Depending on your spending, after a few months you’ll have maxed the card out, but will have at least enough in the savings account to pay it off before the offer expires. At which time, you do so and keep the interest you’ve made.
Hey, it’s xmas/that time of year/etc. You’re all going to be broke come January so I’m tying to help!