The mechanics of the float
Open a card with a 0% intro APR on purchases, typically 12 to 18 months. Route your normal spending to it and pay only the minimum each month. The cash that would have paid those bills goes into a high-yield savings account or a Treasury bill ladder earning roughly 4 percent. At the end of the promo, the parked cash pays the card off in full, and the interest it earned along the way is yours.
The numbers are modest but real. A $15,000 balance floated for 15 months at 4 percent earns about $750, more if the yield holds and the balance builds early. It stacks with the card's signup bonus and rewards, since 0% purchase cards often carry both. The cost is bookkeeping discipline and a temporary hit to your utilization ratio.
This only works with spending you were going to do anyway. The float pays you for rescheduling real payments. The moment the card balance represents spending the parked cash cannot cover, you are not floating, you are borrowing at a teaser rate, and month 13 will price that mistake at 18 to 29 percent.
Where to park the money
The parking spot must be boring. A high-yield savings account at roughly 4 percent, or T-bills laddered to mature before the promo ends. T-bill interest is exempt from state income tax, which nudges the after-tax math in their favor for anyone in a taxed state. Nothing with principal risk belongs here: the entire strategy collapses if the payoff money is down 20 percent the month the promo ends.
Keep the float money in a separate account, not mingled with your checking. The biggest practical failure of this strategy is the parked cash quietly becoming spending money over 15 months. A dedicated account with the card's payoff date in its nickname is cheap insurance against your own future self.
- ▸HYSA at ~4 percent: simplest, liquid, FDIC insured
- ▸T-bills maturing 30-60 days before the promo end: slightly better after-tax yield
- ▸Never equities, never crypto, never anything that can be down when the bill is due
- ▸Separate account, labeled with the payoff date
The month-12-to-18 payoff discipline
Write down the exact promo end date the day the card is approved, then set the payoff for at least one full statement cycle before it. Promo expirations are precise and unforgiving: interest at the full APR begins on whatever balance remains, and on most cards the grace period math means you want a zero balance before the final promo statement closes, not just before the end date.
Set three calendar reminders: 90 days out, 30 days out, and the payoff execution date. At 90 days, confirm the parked balance covers the card balance with margin. At 30 days, move the money to liquid form if it was in T-bills. Then pay it off and confirm a zero balance on the next statement.
Autopay the minimum from day one. This is non-negotiable and it is the rule most floats die on.
One late payment kills the promo
Nearly every 0% promo contract contains a penalty clause: a single late payment can terminate the promotional rate and reprice the entire balance at the penalty APR, often 29 percent or more, immediately. One missed minimum on a $15,000 float converts a $750 earning play into a $4,000-a-year interest bill until you pay it down.
Autopay for the minimum payment, set up on day one and verified after the first statement, removes nearly all of this risk. Verify it actually executed on the first cycle, because autopay enrollments fail silently more often than banks like to admit. After that, the float runs itself until payoff day.
Dead math and trap products
Balance transfer arbitrage, the older cousin of this strategy, is dead at current pricing. BT fees run 3 to 5 percent upfront while parked cash earns about 4 percent a year. A 5 percent fee against 4 percent annual yield is negative on any promo of 15 months or less, and barely break-even after tax beyond that. Courses still teaching BT arbitrage are teaching 2021 math; this is exactly the kind of stale module that $500-plus programs never update and we do, free.
Deferred-interest store financing is a different and nastier product wearing the same costume. No interest if paid in full in 12 months means interest accrues silently from day one and the entire accrued amount hits you retroactively if even $10 remains at the deadline. True 0% APR waives the interest; deferred interest defers it. Read which one you are signing, and treat anything sold at a register with suspicion.
Also skip the float entirely if a mortgage application is on your horizon. A maxed 0% card reports as high utilization, and the score hit arrives at exactly the moment an underwriter is looking.