Sainsbury's Credit Card - Balance and Spending?

helenjones833

Hi,

I currently have a Barclarcard, which I pay in full every month. I'm looking into getting a second credit card to help pay off an excessively large bill from the christmas period at 0%. I also may be interested in a 0% spending card for the next few months, as things are expensive now and I expect household income to increase some time this summer.

The Sainsbury's card offers 0% on Sainsbury's purchases (which I make quite a lot of) for 12 months, and 0% on balance transfer with 3% fee for 10 months. I would anticipate being able to pay in full before the end of both these time periods. However, Martin says in his article that you should never put both types on the same card. What would be the problem with this? Would it be worth getting two separate cards, despite the drop in credit rating if you do that?

nzseries1

If you can pay BOTH the balance transfer AND the Sainsbury's purchases off within 10 months, then you are fine.

However, if not, in the 11th and 12 months your payments will be allocated to the purchases first (because they will have the 0% interest rate, while the 0% on the BT will have expired), and the balance transfer will accumulate interest - which you won't be able to do anything about unless you paid off the entire balance.

DONT MAKE ANY OTHER PURCHASES THAN SAINSBURY'S PURCHASES AT 0% INTEREST! If you do the balance transfer, and then use the card for any other purchases other than Sainsbury's (any purchase that attracts interest), then your payment will go to the balance transfer first (because it will have the 0% rate), leaving the purchases to attract interest until the entire balance transfer is paid off. This is why you should never spend on a balance transfer card - unless there is an interest free period on purchases AND the BT.

You are not able to specify that you want your payments to pay off the interest-bearing part of the balance - Sainsbury's decide what they pay off and it will be whatever costs you the most.

I hope that makes sense - it's not easy to explain! Ultimately YES, two separate cards is better and much safer.

dazza.mk

There's no issue as long as you intend to repay the full balance or balance transfer to a new card by the end of the 10th month (from application NOT 10th statement).
If you were to run the card until the end of the 12 month 0% BT period you would be charged interest on all spending still on the card from opening after month 10 (as any repayments would only pay off any spending once the 0% Balance Transfer was cleared in full)

Phantom_Flan_Flinger

helenjones833 wrote: »

Martin says in his article that you should never put both types on the same card. What would be the problem with this?

As above, for the Sainsbury's card it's OK, as long as you keep it to Sainsbury's purchases.

What Martin's referring to is cards that offer, for example, 10 months 0% balance transfer, but only 3 months 0% for purchases.
If you BT'd £1000 and then made purchases of £800 in the next 3 months, payments you made to the card would only go towards paying the BT and not the purchase balance. You would then start paying the full interest on the £800 purchases every month until you cleared off the BT.
Hope that makes sense.