Do I need to get a credit card?

Hootie19

I had two credit cards - Capital1 and Aqua - and have repaid them in full - finally. Yay me!! I have shredded the cards and written and cancelled both accounts.

We are just in the process of changing from a subprime mortgage lender to a high street lender (yay us!) so obviously our "keep our heads down and repair our credit rating" has worked :j:j.

My husband still has two credit cards with small, manageable, balances on them (one for personal spending, and one for work expenses which are reclaimable), so he can still show a repayment/credit management history for future possible remortgages etc. But I have nothing. No credit cards, no loans etc (I do have, and use, an overdraft on my current account though).

I am so loathe to get another credit card, but I'm wondering if I should get one and just spend £20 a month or so on it, and pay it off each month, to maintain a repayment history. Or would my overdraft do the job. Or is using an overdraft seen as a bad thing?

lilac_lady

If you've no cash safety net and are sensible about paying off your credit card each month, I'd get one and use it for petrol and/or groceries only. That way you keep in control and your credit rating may benefit.

foxgloves

Since getting our debts under control, my husband & I have kept one debit card & one credit card each. The credit cards are there for emergencies. We both chose cards where using them gives reward points (M&S & John Lewis) and decided that as we have to buy petrol anyway, we'd use our credit cards for all our petrol purchases. This keeps up a positive credit repayment history, every so often we get vouchers to spend in M&S & John Lewis and also helps us keep good track of how much we are spending on petrol, so encourages us to try & be more economical/shop around for it. Having a credit card has also been useful on a couple of occasions when my debit card refused to swipe and I wouldn't otherwise have been able to pay. However, one thing we're both squeaky clean on now that we're reformed is paying the cards off in full at the end of every month. This way, they work for us, instead of against us. You do have to be strong but done this way, the only people benefitting is us, not shops & banks x

DarkConvict

There is no harm in getting a credit card, just ensure payment in full is set every month. if you are rebuilding a history it is not only good for the file but for experience. Given you spend get a bill then pay, almost 3 months after a purchase. It confused me when i first got a credit card.

Iwani

What they said, esp reward cards - free money!- and also if you're at all worried about temptation to splurge I'd set a really low credit limit. And congrats on paying those debts off!

happycamel_2

Hi, I've got a Tesco credit card; great for the double clubcard points (I convert to airmiles and get free flights for our holiday every year). But pick whatever suits you. It took a bit of arguing but I got Tesco to set up a direct debit that takes the full balance every month. Doesn't half help focus the mind when budgeting and avoids the feeling that spending on a credit card doesn't count!

Marisco

Does a CC help your rating though? I've not had one - through choice - for about 18 years, and I have never had a problem getting credit! I tend to pay cash (or use debit card) for everything, but on the odd occasion I've had to get credit and a loan, I've never had a problem.