We’ve got a great range of guides to help you get more information about the various credit card products on the market. Our guides help you to choose the right credit card or give you advice and guidance on how to deal with credit card debt.
In the UK it has to be said we have something of a credit culture and most adults in Britain are in all sorts of debt, not just mortgages but car loans, store cards, credit...Read this guide
We all know that credit cards have extremely high interest rates and it’s our duty to keep up with the monthly minimum repayment set out by providers, but are you aware that you could have been...Read this guide
There are numerous advantages to getting a credit card and really, every responsible adult should at least consider getting one....Read this guide
For most people, getting a credit card is a great idea; they help to build up your credit rating, protect you from fraud and are pretty universally accepted to pay for anything. But they are not perfect for everyone and...Read this guide
Improving your credit score is actually pretty easy, all you need to do is add new positive information to your credit file and avoid adding any negative information such as missed payments,...Read this guide
Getting a store card for your favourite high street shop can be a good way to earn back rewards on things that you would...Read this guide
Ok so you’ve decided to get your first credit card, whether it’s a Manchester United credit card or a standard...Read this guide
A credit card cash advance is a service similar to using a debit card. It allows using your credit card along with the card’s pin in order to withdraw the necessary funds rather than using...Read this guide
You’ve probably noticed the insane amount of TV adverts lately for travel credit cards. You have the airlines, hotels and banks all peddling their...Read this guide
Cashback credit cards offer money back for every pound spent on them and can be a great little bonus for people with a good credit score and who are able to clear their balance every month. Card providers reward...Read this guide
For most people in the UK credit cards are an essential part of everyday life, they give you an enormous amount of convenience when paying for things and they also usually come with an extra level of protection from things like fraud – which is one great reason why you might use one instead of your debit card. Of course some people dislike using credit cards, after all if you have the money why borrow money to pay for things? It seems odd to borrow £50 for your shopping when you have that much in your current account anyway right?
Well there are plenty of reasons actually…
As I mentioned, you get protection. Credit cards are full of features that your debit card doesn’t have. If your card were to be stolen or cloned, the thief would only be able to spend your money up to the credit limit on the card and as long as you report it as soon as possible you would generally not be responsible for the bill.
Credit cards also give back; if you shop around you might well find a deal whereby you get 1-2% cash back on every purchase. It’s not a lot, but if you do all of your shopping with that card and say you spend £500 a month on it – well that’s £5-10 a month you would get back for free.
Also of course, using credit regularly will improve your credit rating. Banks love to see a long history of borrowing money and paying it off and credit cards provide the most convenient way of doing so. You may not think you need to worry about such things, but having a better credit rating will mean you have access to better rates on loans when you do need them; and after all, if you can save just 0.5% on your mortgage rate that will save you hundreds of pounds a year.
So what’s the catch?
Not surprisingly most people are suspicious of all those benefits, after all – why are they incentivising you to borrow money? That has to be bad right?
Well credit card companies actually make the bulk of their money through transaction costs. Sure you will pay interest if you don’t pay off you bill in full, but most people do (and you should too).
Every time you make a purchase, your credit card company will charge the merchant a fee of generally 2-3% of the total amount. Obviously the more people who use that credit card the more money the credit card provider makes.
Getting the best deal
There are a lot of credit cards out there with all sorts of promotions and offers available and deciding on the best card for you is no trivial matter. But that’s where we come in!
Choosing a credit card depends a lot on what you want. Are you looking for a good way to improve your credit? Do you want your first credit card but not sure if you’ll be accepted? Alternatively you might have debt you want to move around to save on interest or you might just want to get the best return on your spending.
There are credit cards for all eventualities and they don’t all work the same. Most cards have a 30 day no interest policy on all spending, but some cards extend that up to 60 or 90 days, which can be handy if you have a big purchase you want to spread over a couple of months.
There are also cards with special offers on balance transfers which can be an excellent way to manage long term debts if you are trying to pay them off with minimal interest. Of course you have to be careful how you use your cards and getting more than one card is sometimes helpful to make the best savings.
But maybe you just want some cash back – you don’t have debts, like using a credit card for the convenience and you want to get free stuff… Well getting on card is fine, but some cards give better deals on certain types of purchases than others, so for the best results some people go as far as to have 3 or 4 different cards for different things.