Big Fat WARNING about credit cards

lisyloo

The way I was penalised seems so disproportionate.

I would also point out that the charges/fees are made very clear up front and it's up to the customer whether to accept or reject the contract.

In times past it might have been valid to claim foul play when these were hidden in small print, but now we have things like the "summary box" where the fees and charges are made very clear, so it's no longer valid to claim it was hidden in the small print or not realistic to read all 300 pages.

If the customer feels the charges are disproportionate then they shouldn't accept the deal and should seek alternatives. The time to do this is up front. If there is no credit card on the planet that provides acceptable fees/charges, then the answer is simply to save up before you buy things which can be extremely good advice.

lisyloo

My big FAT warning about credit cards would be something like as follows:

Credit cards have useful features if you are disciplined however they can both tempt you to spend too much and also have high fees and charges if you are not disciplined about managing the payments i.e. making the correct payment in the correct timescales (and understanding the subtleties like clearance times of various payment methods and bank holidays etc.).

If you don't think you can be discplined then the simplest answer is not to use them at all.
Simply save up before you buy things. This avoids overspending and also avoids having debts if you become ill, die or have an accident. To be safe you really need insurance for debt which adds to the expense.
If you are worried about payment management then set up a direct debit for the minimum. You can then make additional payments on top but at least the minimim is paid and your credit rating is intact.

If you can use credit cards then they have useful features like section 75 proptection, cash back, 0% periods, warranties, insurance etc. But mis-use (whether intentiontional or not) can lead to messing up your credit rating which can impact on your ability to get important credit in future like a mortgage.

Jazzie99

I havent read all the thread but just a quick message to the OP....... what really helps me manage my money is on-line banking (easily set up with Virgin). You can check statements/payment dates and make 'faster payments'.

Having said that I did make an error last month with my Natwest Card. I was a bit too eager to make a payment and it ended up in the wrong period! I then had to find another £200 for the current period.....it that makes sense!! I did try calling them and asking if they could adjust the payment date but they couldnt....... my fault, no one elses!! Lesson learnt!!