New to credit cards - help!

cluuuuur

I've finally decided that I should get a credit card. I use my debit card for everything, and I really want to be better protected against fraud. Hopefully I won't have any issues with acceptance as I have a car on credit, contract mobile, mortgage and no other debts except student loan.

The question is - what's best? I won't be using it for anything I can't pay off immediately, and I want to pay everything off monthly - my plan is to transfer everything I spend on it from my current account into a savings, and then get rid of the debt at the end of the month. I won't be using it for cashback as I might as well just use a cashpoint and my debit card - or is this a stupid way of thinking? I've been under the impression that cashback on credit cards costs loads.

I'd really like one which rewards me. My Dad, for example, has a Sainsbury's credit card and gets big rewards in the form of Nectar points. Unfortunately it's an AMEX card, and it seems that there are loads of places that don't accept them. It'd be nice to get rewards that I can use for 'treats' for myself, OH or my son.

I have no idea what's out there, what would suit my needs best, and what all their jargon is about (blonde!)

I bank with Halifax for current a/c, ISA etc, and HSBC for savings.

Thanks

thefenman

I am tempted to answer "Advice to those about to take out a credit card - don't!"

I wouldn't presume to advise anyone whether or not to take out a credit card but one piece of advice I would give you is never, repeat NEVER draw cash with it. You pay interest from day 1 on top of the "transaction fee". Worse, when you do pay, there is a hierarchy of how they apply your cash and some credit cards (I had an MBNA that did this) they put CURRENT (ie the current month's new charges) ahead of cash so that it is possible that you never actually pay off the balance and just keep having interest added to the amount owing.

This hadn't used to be the case, cash drawings were at the top of the tree but I think this was changed to stop people drawing money to pay the monthly bill.

You state that you want to pay off monthly - do so. I've been in the credit card mire in the past and, having extricated myself, I now pay the balance off each month though do so as late as possible. It is a very nice feeling. To impose a little discipline, you can set up a direct debit with the bank to settle each month. As you have spotted, well used, a CC is a great help in managing cash flow.

One last comment - stick to the "main line" cards such as HSBC (almost, but not quite, the only bank to steer clear of trouble but I understand even they fell for Mr Madoff's scam). The one to steer well clear off is Vanquis, they are the most horrendous rip-off merchants.

thefenman

In fact, you are in the right place for all the advise you can absorb. Click on "Cards, Loans" above.