Is a credit card the right solution to my problem?

jorgeregula

Hello,

I am due £14k inheritance from a family member dying, but it will take somewhere up to a year to receive the money. I am unemployed and receiving benefits, but actively looking for a job.

I have been considering getting a credit card to help with daily things like food shopping with 0% on purchases for a year, and paying back the minimum amount each month and then when my cheque comes through paying it all off and cancelling it.

Is this a good idea? Because I'm unemployed will I even be able to get a credit card? Which credit card would be the best for my situation?

Thanks for your help.

chattychappy

It all makes sense in theory. Of course if you are expenses are greater than your income, eventually the inheritance would run out if you didn't find employment in time.

Tesco do a good 0% on purchases card.

But you've spotted the problem - it really is difficult to get a good credit card (such as Tesco) if you're unemployed and I think this is where the plan falls apart.

What is the delay with the inheritance? If it's tied up in a property sale then that is understandable. If not, perhaps speak to the executors and ask if there is any way things can be moved more quickly or an interim payment made.

chanz4

family member dying, what if they dont..... Kind of a sick post really

YorkshireBoy

chanz4 wrote: »

family member dying, what if they dont..... Kind of a sick post really

I suspect (hope!) you may have misread the opening sentence.

chattychappy

Oh I see! Missed that interpretation.

jorgeregula

Thanks for the advice, and my family member has already died - the money is tied up in property.

jonesMUFCforever

Your problem is that without any income (other than benefits) you will not get any credit cards.

dresdendave

My advice would be to forget about the inheritance for the time being and live within your means, accepting that may be tough on benifits.

I think you have little chance of a credit card in your current situation and in a way this is a good thing. By having to live purely on your benifits this gives you a real incentive to find work and when your inheritance finally comes through it will be all yours, rather than finding you have already spent a big chunk of it, as could be the case if you borrow now.

dtsazza

dresdendave wrote: »

My advice would be to forget about the inheritance for the time being and live within your means, accepting that may be tough on benefits.

I agree - this inheritance won't be a form of income but will be a single lump sum. As such it's a "one shot deal", and there's definitely a temptation to spend more than your income for a while, until the lump sum has dried up and you've become used to a higher standard of living than your income supports.

In that respect I'd be wary about using lump sums for everyday expenses. Ideally there'd be some way of investing it in an equally one-off type purchase (such as a house deposit, or a cost-effective car to reduce transport costs, or course fees for a qualification that will help your income, etc. etc.). You could splurge it on something like a holiday too, though these opportunities don't come very often and it would be a shame not to make something of it.

I can appreciate that if you expect your income to rise in the mid term you might want to use the money to plug the gap until then. But these things have a habit of not happening exactly on schedule so you might end up falling into the situation above. It is your money and your life at the end of the day.

Chances are that you'd have trouble getting a 0% credit card without an independent income, so that plan may be out anyway.

ossie

Temptation to spend more than your income but what happens if property price drop. You get less inheritance but still have the same debt = TROUBLE. Live within your means till money 100% in pocket. I am due a lump sum on retirement but do not spend it before I get it as it = TROUBLE. Difficult i know in your situation but think you will sleep a lot easier without a noose over your neck till/if inheritance pays out.... Good luck

Jemma-T

"Don't count your chickens before they're hatched."

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