Balance Transfer Break-Even Calculator NZ

This calculator works out whether a credit card balance transfer is worth doing in New Zealand by weighing the interest you save at the low promotional rate against the transfer fee you pay to move the balance. A balance transfer can be a smart way to dig out of credit card debt, because moving a balance from a card charging close to twenty percent to one offering a low or zero percent introductory rate stops the interest piling up while you pay it down. The catch is that most transfers come with a one-off fee, usually a small percentage of the balance, and the promotional rate only lasts for a set period before reverting to a high rate, so the move only pays off if the interest you save beats the fee and you clear the balance in time. You enter your balance, your current interest rate, the transfer fee percentage, the promotional rate and how many months it lasts, and the calculator shows your net saving over the promo period, the transfer fee, and the break-even point at which the saving covers the fee. Use it to decide whether to transfer and to remind yourself to stop spending on the card and clear the balance before the promo ends. Estimate only, not financial advice.

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$1,516
net saving over the promo period
Interest saved$1,596
Transfer fee$80
Break-even0.6 months

Assumes the balance stays put over the promo period; paying it down sooner saves a little less but clears the debt. Stop spending on the card. Estimate only.

How it works

The interest saved is the balance times the difference between your current rate and the promo rate, for the promo period (months divided by 12). The transfer fee is the balance times the fee percentage. The net saving is the interest saved minus the fee. The break-even is the fee divided by the monthly interest saving, the months it takes for the saving to cover the fee.

Worked example

Transferring 8,000 dollars from 19.95 percent to 0 percent for 12 months saves about 1,596 dollars of interest. A 1 percent transfer fee is 80 dollars, so the net saving is about 1,516 dollars, and the fee is covered in well under a month.

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Frequently asked questions

What is a credit card balance transfer?

You move the balance from a high-interest card to a new card offering a low or zero percent rate for a promotional period. It can save a lot of interest, but watch for a transfer fee and what the rate jumps to when the promo ends.

Is a balance transfer worth it?

It is worth it when the interest you save at the low rate over the promo period is more than the transfer fee, and you can clear or move the balance before the promo ends. This tool compares the saving against the fee for you.

What is the catch with balance transfers?

New purchases on the card may be charged at the standard rate, and the transferred balance reverts to a high rate once the promo ends. Paying it off within the promo period, and not spending on the card, is the key to coming out ahead.