How it works
A balance transfer moves what you owe to a card with a low or 0% introductory APR. The card charges a transfer fee, which is added to the balance, and when the intro period ends whatever is left starts costing the card's regular APR. It pays off when the interest you avoid is bigger than the fee, and it pays off best when you clear the balance before the intro rate ends.
Worked example
You owe $6,000 at 24% and can pay $300 a month. On your current card that takes 2 years 2 months and $1,739 of interest.
Move it to a card with 0% for 18 months and a 3% fee: the fee adds $180, so you owe $6,180. After 18 payments, $780 is left and starts costing 24%, and you're done in 1 year 9 months. In total the transfer costs $210 instead of $1,739: you save $1,530.
Pay $344 a month instead and the balance is gone before the intro ends, so the $180 fee is the only cost.
Things to know
- 0% still has a fee. The CFPB notes that issuers may charge a transfer fee on a 0% offer, usually a percentage of the amount or a flat minimum, whichever is more.
- The intro rate has rules. It must last at least six months, unless you're more than 60 days late, and under many cards' terms a single late payment can still cost you the promotional rate.
- New purchases may cost interest. Purchases on the transfer card can be charged the regular APR even while the transferred balance is at 0%. Check the terms, or keep the card for the transfer only.
- Approval isn't guaranteed. The best offers need good credit, and the new card's limit may be lower than the balance you want to move.
Questions people ask
Is a balance transfer worth it for a small balance?
Only if the interest you'd avoid is more than the fee. A 3% fee on $1,000 is $30; if you'd clear $1,000 in a few months anyway, the interest saved may be less than that. The calculator shows the break-even for your numbers.
Should I close the old card?
Usually not right away. Closing it lowers your total available credit, which can raise your credit utilization and dent your score. Keep it open with no balance, unless it has an annual fee.
What if I can't clear it before the intro ends?
What's left is charged the card's regular APR. A transfer can still save money, as in the example above, but compare with a fixed-rate consolidation loan, which ends on a set date, and see the credit card payoff calculator for a payoff plan.
Sources
- Consumer Financial Protection Bureau: balance transfer fees on 0% offers
- Consumer Financial Protection Bureau: how long an introductory rate must last
- Consumer Financial Protection Bureau: interest on new purchases after a balance transfer
- Federal Reserve: consumer credit (G.19), average credit card interest rates
Reviewed September 29, 2026 by The Dollars World team. How we build and check our calculators · Our data and formulas. This is general information, not financial advice.