Martin Lewis has revealed how Brits can make hundreds of pounds by ‘stoozing’.
Many people probably haven’t heard of the term before and while it may sound like the name for an odd, new dating trend, it’s far from it.
In a recent MoneySavingExpert.com newsletter, the savvy money expert shared lots more handy tips for people wanting to save cash.
Lewis wrote about ‘stoozing’, which is making a comeback because of rising interest rates.
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The hack, Lewis warned, is only for the ‘debt free and financially savvy’, which means if you’re not the type of person who is always on top of your money, 'stoozing' might not be for you.
"If you're not too on top of things, don't understand, don't have financial self-discipline, or have other credit card, overdraft or loan debt, this ISN'T for you, as mistakes cost,” Lewis writes in the newsletter.
"If in doubt, don't. Plus you'll also need a reasonable credit history to get a decent credit limit."
Stoozing involves taking out a 0% spending credit card and using that card for normal, everyday spending.
You would then put the money you’d normally use for everyday spending into a high-interest savings account each month, leaving the cash to build up.
When you 0% interest deal on your credit card comes to an end, you should pay off the balance using the money in the savings account.
Once you’ve cleared your credit card balance completely, you should be left with the interest you earned on the money borrowed from the credit card company.
Lewis shared a smart way you can make the stooze period longer.
" In the MONTH BEFORE THE 0% ENDS, either use the money in savings to clear the 0% debt before any interest is charged, or shift it to a 0% balance transfer, a fee-free one's best to maximise the gains.
"Yet even if you're aiming to do the balance transfer - don't let that tempt you to go for a longer savings fix, just in case you're not accepted.
"Of course, with a decent credit score and careful management, you can do this with more than one card and build your stooze-pot, so you're earning more."
In a throwback to our days of taking maths exams, he also shared an example of how someone could make £400 using this method.
"Imagine Sally Stoozer gets a 23mth credit card with a £5,000 limit. She usually spends £1,250 a month, and puts all that spending on the card, paying just the monthly minimum.
"She moves the money from her bank account to a 3.85% easy-access account each month.
"A little after four months she has the full £5,000 in there, which she transfers to an 18mth fixed-savings account at 5.15%. By the time it ends, she has £5,425 in there - so £425 profit.”
Luckily, he did all the hard work for us!
Topics: Money, Martin Lewis, News, UK News
Gregory Robinson