Frugal living tips @ CheapEncounters.com » interest http://cheapencounters.com Fri, 06 Apr 2012 14:55:23 +0000 en hourly 1 http://wordpress.org/?v=3.3.1 Don’t get burned on your credit card balance transfer! http://cheapencounters.com/2008/06/09/dont-get-burned-on-your-credit-card-balance-transfer/ http://cheapencounters.com/2008/06/09/dont-get-burned-on-your-credit-card-balance-transfer/#comments Mon, 09 Jun 2008 14:40:27 +0000 BillyOceansEleven http://www.cheapencounters.com/?p=245 Here is a cautionary tale from our friend at Debt to Dreams. Our friend was apparently playing the credit card arbitrage game, which is where you take a no/low fee balance transfer at 0% on your credit card and put the money in an insured savings account to earn interest. It is a great game [...]]]> Here is a cautionary tale from our friend at Debt to Dreams. Our friend was apparently playing the credit card arbitrage game, which is where you take a no/low fee balance transfer at 0% on your credit card and put the money in an insured savings account to earn interest. It is a great game and one that I do myself, however there is the risk that you will slip up and end up having to pay the bank interest unexpectedly. I had a small slip with my AMEX Blue card when I didn’t realize that the promotional term was only six months when the advertisement showed “up to” 15 months. Thankfully my slip ended up only costing me about $30, but it was still a good lesson.

For Debt to Dreams, however, the damage was more substantial. Somehow he missed the expiration of the rate like I did, so when the next month’s bill arrived the statement showed that the promo rate had been replaced by the normal rate, which had been applied to the entire balance. Apparently this was a much bigger balance than I had because the damage was $557. Ouch!

I guess the lesson is to read everything carefully and keep track of the expiration dates of the promotions. Outlook and Yahoo Calendar reminders are great for this.

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