Do you use a credit card? I’ve been using them since I was old enough to have one. When I was very young I used credit cards to buy expensive items that I couldn’t afford, I would pay the balance off as fast as I could manage over a period of months, but probably not fast enough to avoid interest. Looking back it wasn’t the most sensible approach, especially as I hadn’t built up much of a credit rating so couldn’t get the best deals. Later on I would use 0% interest credit cards, like the one on offer from TSB at the moment, taking full advantage of the the 0% period and then transferring the balance when the special offer period ran out. This was a great way to avoid expensive store card interest rates and kept us going when we first bought a house and needed to furnish and decorate.
These days we do 90% of our spending on a credit card, mostly to get the loyalty points and then pay it off in full each month, avoiding the interest all together. The downside of this usage is that it makes it hard to budget and easy to overspend, but a big positive is that there is some protection if an item is lost or damaged or if the card is used fraudulently. Another benefit is that as we do pay the card off each month, it means we have some money available in case of an emergency.
I’m very aware that to manage a credit card sensibly there are some things we need to be very careful to avoid, for example overspending, as if we can’t pay the balance one month we could start accumulating interest at a high rate, which I imagine can spiral out of control quite quickly. I also never take out cash on our credit card as there is usually a fee for this and am careful to check what happens when we pay using a card abroad where there can be charges each time you use it.
How do you use credit and store cards? Do you choose a card based on a loyalty scheme or interest rate? Do you have any tips for using a credit card sensibly?
In collaboration with TSB.
Credit cards are great as long as you use them in the right way – mine has helped me build up my credit score and of course helped me out in emergencies as well. x
I think there is a lot of scaremongering when it comes to them, but essentially they can be a blessing and a curse x
I think that there is a place for them, but I wish that I had more financial savvy mind when I was younger and used them to much!
I won’t have a credit card ever again – I am not disciplined enough to use it sensibly
I honestly do not trust myself with a credit card
I think the protection you get on a credit card is brilliant and I always make big purchases on mine x x
Credit cards are great. I use mine for internet purchases so I know I’m always covered if something goes wrong. I do have a fair amount built up on there but always pay off a good chunk each month. I know as long as I’m sensible and remember it’s borrowed money I won’t be silly with it!
Credit cards are great if used sensibly. It can be too easy to overspend on them though, you have to be disciplined.
I have never had a credit card, but also because of this I do not have a really high credit rating. Not because I don’t pay things off but because I don’t borrow first lol, it has never made sense to me but I am now considering getting one maybe just to do the weekly shop to up my credit x
The most important advice for using credit cards, as you say, is to pay the balance off in full every month, otherwise you end up paying interest.
There have been times it has been a blessing and others an absolute curse!
I do not have a credit card. I’ll never use one again. I had several when I was younger and they caused me no end of trouble. I’ll never recommend them to my children either.
Great advice. I think CC’s are good for emergencies and ok if you pay the balance each month otherwise fees can get ridiculous
Credit cards can be so useful but it’s important to be really strict with them, isn’t it? They’ve been a learning curve for us but we’re finally pretty balanced in the way we use them.
I have never had one, and I am pretty certain it was the right choice 😀
I don’t have a credit card. I’d be far too lethal with it! x