Balance-transfer net saving over the promo window

What the promo window gives and the fee takes back

The comparison is three quantities and one subtraction. Interest the balance would accrue at the current rate over the window is the benefit; interest it accrues at the promotional rate plus the one-time fee is the price; the net saving is the first less the second. A positive figure says the window buys genuine relief; a negative one says the fee is eating more than the rate gap returns.

Both interest figures are simple interest on a balance held flat — deliberately not an amortisation. A real balance falls as payments land, so both sides are overstated, but because they are overstated together the netting remains a fair sizing of the offer even though it is not an exact ledger of the account.

The window is the whole story, and that is the honesty this page has to insist on. The comparison ends the day the promotion does; whatever balance survives that day starts accruing at the transfer card’s ordinary rate, which this calculation never sees. The classic way transfer arithmetic flatters the move is measuring only inside the window while the debt outlives it — a transfer without a payoff plan is a postponement wearing the costume of a saving.

The fee deserves its own respect. On a modest rate gap or a short window, a fee taken as a share of the whole balance can swallow the entire benefit, which is why offers so often pair a lower fee with a shorter window and a higher fee with a longer one. That pairing is exactly the trade this calculation prices.

When this calculation is used

• Sizing a transfer offer before accepting it: whether the fee is smaller than the interest the window avoids.
• Comparing two offers with different fees, promotional rates and window lengths on the same balance.
• Checking whether a short window at a zero rate beats a longer window at a modest promotional rate.
• Putting a figure on the cost of leaving a balance where it is, when the current card’s rate is doing steady damage.

Worked example

A card balance carrying a punishing rate, an offer with a moderate one-time fee, and a promotional window at a zero rate lasting about a year — the standard shape of a transfer offer.

The engine reports the fee in money and the net saving over the window: what the current card would have charged, less the promotional interest and the fee. A healthy positive figure means the window genuinely buys relief; a thin or negative one means the fee is eating the rate gap and the balance may as well stay put.

The figure assumes the balance stands still. Paying it down through the window shrinks both interest figures together, so the netting stays fair — but whatever remains when the window closes starts accruing at the card’s ordinary rate, outside this comparison entirely. Pair it with a payoff-time check to see whether the debt can actually die inside the window.

What each input represents

Assumptions and limits

• Interest on both sides is simple interest on a balance held flat for the window; neither side is amortised.
• The comparison ends when the window does — the rate the promotional card reverts to afterwards is not modelled.
• No new spending lands on either card during the window.
• The fee is a straight share of the balance; flat minimum fees and deferred-interest clawback terms are not modelled.
• Payments made during the window shrink both interest figures roughly together, so the net is a sizing of the offer rather than an exact account ledger.

What the guards protect against

• A zero or negative balance is refused — with nothing to move there is no fee, no interest and no comparison.
• A window of zero months is refused because no interest accrues in it on either side, and the comparison would have no horizon at all.
• The fee and both rates are refused outside a realistic range — a negative fee or rate would describe the card paying the borrower, which no offer does.

Provenance

Balance-transfer net-saving comparison over a promotional window

Simple interest on the balance at the current rate over the window, less simple interest at the promotional rate over the same window, less the transfer fee taken as a share of the balance, gives the net saving.

Educational reference, not financial advice, and a deliberate simplification that holds the balance flat over the window. The signed pack carries its own citation; the page reports the verification state of the release it mounted rather than asserting one.