Transfer balance or stick it out?

[karkli]

Hi! First post here on SavingAdvice.com, so if this is in the wrong place or it's an oft repeated topic (likely!), I'll happily follow your lead to the correct area of the forum to get the info I'm looking for.

The interest rate on my American Express Blue card recently increased from 10.99% to 13.99%. It was an "across-the-board" increase not specifically related to my account, credit score, payment history, etc. I've spoken with customer service and they tell me that they aren't currently offering any lower interest rates for existing customers.

So I can either keep paying down the balance on this card, or I can transfer the balance to a 0% intro card and pay a 3%balance transfer fee. (Any options I'm missing?)

Do I suck it up and pay the 13.99% interest, or pay the appx. $150 balance transfer fee in order to procure 0%?

(Answers to unasked questions: The balance on the card is $5200. It is the last card in our so-called "debt snowball" so, while I haven't significantly decreased the balance in the past two years, I've not added to it, either. Barring any unforeseen circumstances, this card will be paid off in July/August 2009. I estimate that I'll be paying in the neighborhood of <$250 in interest between February-July/August if I keep the AmEx.

Yes, I know the conventional wisdom re: open accounts, new accounts, FICO scores, etc. and I'd like to take that wisdom under consideration without bowing down to it. No, I'm not a die-hard guru-follower, though I do love to "read the gurus"! )

Thanks in advance!

[Seeker]

If you pay 902.40 on your current 5200 loan.... you will be done in 7/2009 with a total interest of 214.39 at a 14% rate.

To transfer will be 3% or 156.

So the question I have is :
1) How sure are you of being able to get a 0% offer?
2) How much is your time and effort worth ?

Me, personnally, I'd finish at the current rate.

Without knowing your income/expenses, only you can determine how worthwhile the $50 difference is. As always, if you can pay more toward principal each month, the total interest dollars paid, will become lower.
So it really will depend on how much you can afford to pay extra.

[maat55]

If you are sure you will have it paid by Aug., I would leave it. If there is any chance you might get lazy, I would do the transfer. To me, leaving it where it is is motivation to get it paid.

[creditcardfree]

To me, leaving it where it is is motivation to get it paid.

I agree.

[karkli]

Thanks for the responses.

That's pretty much what I was thinking, but I am generally a proponent of going with the lowest interest rate whenever possible, even if the overall savings is minimal because I think that the mindset of "Oh, $50 savings isn't going to help any" or "It's not worth the time for ONLY $50" is the debt mindset. Wanted to make sure I wasn't falling back into bad habits just because I'm finally seeing a light at the end of our tunnel.

So the question I have is :
1) How sure are you of being able to get a 0% offer?

As reasonably certain as one can be in the current credit climate, I suppose.

2) How much is your time and effort worth ?

Probably more than $50.

If you are sure you will have it paid by Aug., I would leave it. If there is any chance you might get lazy, I would do the transfer. To me, leaving it where it is is motivation to get it paid.

I'd say there is 0% chance that I'll get lazy on getting the card paid off. However, life loves to throw curveballs. If an emergency comes up, our first line of defense is our monthly excess which could conceivably push back our estimated payoff date. Hopefully that won't happen!

Thanks again. From what I've read on this forum, there's a lot of great advice to be had.