Do i get a C/C??

padd_bear

Hi All,

I am paying £141.20p a month on my zones 1-4 travelcard, there is absolutely no way i could minimnise this and this is rising to £151.30 in 2011.

At the current rate i am paying 1694.40 a year but at the new rate it would be 1815,60 almost two months wages??

At the moment the annual travel card price is 1472.00 and the new price will be 1576.00.

With my pay on 24th dec and christmas bonus, i shall be left with £550 not including my monthly travelcard after excluding food etc..

Am thinking of applying for a credit card, i have never had a credit card. I am 24, 25 in four months and so far have managed quite well.

I am thinking if i apply for a credit card i could buy a yearly travelcard at £1472.00, using the money i have remaining and putting the rest on a c/c about 1000.

However i understand from reading some of these stories it can become a slippery slope so i am aware of that as well.

What kind of credit cards are recommended?

I mean i dont even know what my credit rating is, i have been offered credit cards before by my bank when i pay money into my account.

I am thinking that i could save alot of money by buying an annual travel card... but am unsure and would like peoples views....?

I cant afford to purchase this without additional funding...

I don't even know if i will be approved. i am always good at paying d/d on time and bills etc... not really had any charges... opened by accident a next credit account and was given a credit limit...

I just want to hear what people think and if they can point me in the right direction...

Thank you in advance.

P_b x

lisyloo

What happens to your travel card if you don't need it anymore? e.g. change jobs, will you get a refund?
I'm just thinking there may be downsides to getting an annual card.

The problem you have is that you haven't had a credit card before so you are unlikely to get a 0% or low rate card.

You could get a normal credit card from your bank but the problem then is that the interest you will pay on the Credit card will wipe out any savings made, so there is no benefit.

You are spending a lot of travel in comparison with your wages.
I assume you have already looked for a similar job closer to home?

padd_bear

I live in zone 4, and work in zone 1, it would take 3 hours by bus travelling through oxford street/ marble arch etc...

I will always need a travelcard, on weekends i am travelling back and forth so i do get my monies worth so to speak.

Just if i buy one this year it will cost £1472.00 and will mean £122 a month instead of £142, yet if i buy next year will be £1576 or £152 a month which is a huge difference, even with interest payments i could still save money as if i was to purchase a monthly for twelve months it will cost me around 1834 so already huge savings?

I could wait until march to buy an annual card using money ive saved but then would be paying 1576 which is alot more?

Just thought maybe applying for a credit card would help me save money?

Just trying to cut costs of my travel, my wages aren't too bad, i have great hours and great bonuses esp when i come to have children.. been at my job a while and to be honest i wouldnt dream of leaving, its secure and thats what you need in these times to be honest.

Suppose if worst comes to worst, could ask my OH!!

lisyloo

even with interest payments i could still save money as if i was to purchase a monthly for twelve months it will cost me around 1834 so already huge savings?

I am not sure what maths you are doing.
The saving is £362 (1834-1472)
I work that out as about 25% i.e. 362/1472 (I realise you'll be making payments along the way, but I'm keeping the maths simple).

So let's assume you don't have access to good deals as you have no credit card history.
The capital one classic card is 34.9% interest.
So how are you expecting to make huge savings?
Are you factoring in a much lower interest rate? Which card?

Does you OH have a history with credit cards?
Perhaps they could get you a card on one of their accounts?

The biggest problem I see here is that you probably won't get one of the cards that does great deals and you will be on a higher interest rate.

padd_bear

Yes i may need to speak to OH about it and see if he can help me get one through his one or lend me the remaining amount... i dont know?

I think if i can pay it off quickly it wouldnt be too bad?? i dont know what kind of card i could get? i havent investigated as there are just so many, am thinking of going with one via my bank??

I guess am looking to minimise my costs of travelling etc... as £152 is a bit much and makes me feel sick even thinking about it when their is such a rubbish service! Wouldnt mind if it was reliable lol..

How much would the interest be per month??

Sorry am not very good with c/c or information as never even considered this before?

Tixy

It all depends on how much you can afford to pay off the card each month. If you could pay it off over 3-4months you'd be likely to save money, if you are thinking of paying off over the whole year you'd be less likely to have a saving.
Although it will depend on whether you can get a credit card with a high enough credit limit and at what APR.
Often people who haven't had credit cards before tend to get low limits and high interest rates.

richard734

Have you looked at the Barclaycard combined CC and Oyster card? i dont know if it is a freedom or cashback card, but it might be worth it for you. use that and claim the rewards...

lisyloo

How much would the interest be per month??

It really does depend on how quickly you pay it off and the rate on the car.
But if you get a car with 20% or more interest rates, then unless you can pay it off quickly then you are quite likely to wipe out any savings.

kjn469

Presumably if the OP is being offered cards by his/her bank then the cards will have a rate of 15/17% which would represent a saving?

Perhaps the OP could help out with details of what bank they are with and what cards they are being offered. As Tixy points out, if you put £1000 on the CC and pay it off over a matter of a few months then you would potentially save money - it all depends on the APR of the card you get from your bank and how quick you pay it off. An APR of 15% on 1000 would mean over a year you would pay £150 - 6 months would therefore cost you less than £75 presuming you are making monthly payments towards the balance.

lisyloo

it all depends on the APR of the card you get from your bank and how quick you pay it off

Agreed.
We really need more info.

padd_bear

Sorry for not replying sooner.

After investigating credit cards and being offered one at 0% for twelve months i didnt need to take one out as a family member kindly brought it for me.

It is a good thing knowing i have an excellent credit rating though.

Thanks for your help x