It’s morning and I’m ready to Stooze

Well, maybe not ready to myself but definitely ready to oversee T. as she works at it.  And definitely ready to share with any readers their experiences along the Stoozing trail as she and I go forward.  BTW, I should mention that most of the info we are gathering appears to be from England, though I know the Aussies are using it too, so don’t get thrown off when the money amounts are expressed as pounds instead of dollars.

Anyway, so there it is.  Right in front of us.  A brand new income stream funded by manipulating the very system that the credit industry has been using to rope us in.  We hope.  Frankly, that’s why T. and I are such good partners.  She gambles where I would not.  I gamble when she would not.  But we never gamble when we aren’t in agreement about the consequences.  We always talk them through.

Unfortunately for me, that means I’ve got to spend sometime researching the whole idea while she runs off to find the best offers to take more advantage of.  I like the things I’ve found out so far but beware of something for nothing keeps running through my thoughts as I check out Wikipedia and then start reading at www.stoozing.com.  Meanwhile, I’m trying to decide how much of a review to give the site that sits behind the stoozing.com one that looks to be a combination of information and sales.  Hmmm. 

Stoozing is a way of making money by exploiting credit cards which have an introductory period during which no interest is charged.
There is fierce competition in the credit card industry, so many lenders have introductory periods of between 3 and 18 months during which they charge 0% interest on the card balance. This allows the Stoozer to borrow money for ‘free’ and to move it into a high interest savings account.

Seems simple when you say it like that.  Take those damn tempting offers and instead of going into debt start earning income from them. 

At the end of the 0% introductory period, the money is withdrawn from the savings account and used to pay off the full credit card balance. The interest gained from the savings account is your ‘profit’. As with any other savings account interest, taxpayers need to pay tax on the interest earned.

Also, you have to be aware of two other things.  One, there is usually a one time fee for the use of the money, either 3% or $99 whichever is higher.  Two, there are three types of offers, 0% on money for a limited period, 0% on balance transfers, and 0% on purchases for a limited time.  Beware of the balance transfer and save it for part two of the Stooze. 

Part Two:

Rather than pay off the credit card directly from the savings account at the end of the period, the Stoozer would normally have another 0% credit card lined up to pay off the first one. Thus, the borrowed money could stay in the savings account for a considerable amount of time.

A Stoozer would typically earn between $400 and $2500 per annum from Stoozing.
Why not put some figures into the stoozing calculator and see how much you could earn?

That’s the part where if you want to be accurate you have to check out the current exchange rate or you can just do like I did and use the numbers in the calculator as a guestimate.  Stoozing has been around for a relatively short time but investors and banks have been doing it for a long time in something called the carry trade.  Even so at the stoozing.com site this caveat is in place:

However, before embarking on Stoozing for the first time, please read our risks section. This is important because you need to be aware of the effects on your credit history and because not everyone has the attention to detail necessary for successful Stoozing. Once you have understood the risks, take a look at the full guide from the pull down menus or click an option below.

One last item for today,  once a month T. and I host a financial game night where we play Cashflow 101 and discuss different financial strategies culled from personal experience.  One person came to a meeting last month and wanted to talk about a new mortgage paying strategy that was being offered by an Australian Bank.

An alternative way of making money from Stoozing is to put the borrowed money into an offset mortgage instead of a savings account. This reduces your mortgage payments, ‘earning’ you money in that way; usually tax free.

We talked about this quite abit at our meeting but could come to no consensus.  No one at the time saw the connection to Stoozing.  And one of the things that I’m discovering is that there isn’t much information about Stoozing in the U.S.  So this  statement from the stoozing site seems apt.

Partial reconfigurations of the offset mortgage are being introduced in the United States, however due to differing US mortgage policies and accounting practices as well as US tax laws these programs are generally not effective.

So that’s it for now.  In a couple of days I’ll take a look at what T. has found out and share it here.

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2 Comments »

  1. Clariman said

    Hi. I was just doing a google search to see where our site http://www.stoozing.com was being referenced and came across your page here. I wrote the stoozing guide on the site and my co-owner (Stooz) is the guy the whole process was named after. Just one point of clarification. The site http://www.moneysavingexpert.com is not “behind” our site. They do give us a small bit of sponsorship but that is it. Stoozing.com is entirely independent and run by Stooz and myself.

    As you have rightly pointed out, the site is UK-based but the principles certainly work in other countries where the banks offer low interest balance transfer cards. The stoozing site does have a board for “US and international stoozing”. We get a few US citizens dropping by, but they are never there at the same time. If you and your readers wanted to post on our “US Board” you would be more than welcome.

    Good luck with your stoozing.
    Clariman

  2. rhb said

    Clariman

    Thanks for the update on the credit card site, we were referred to the stoozing site from there and so we assumed.
    Meanwhile, T cleared $2000 from her stoozes in 2007 and we are now looking forward to this new year to see what happens. Right now we are averaging receiving about 2 0% offers a week amongst our personal and business accounts.

    This economy is making it harder to earn interest though.
    Anyway thanks for the stop by.

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