Stoozing Preparation

jimmyjones_2

Hi,

I want be ready to start stoozing in the next couple of years, whenever interest rates increase and it becomes worth the hassle. The plan is to offset my mortgage and slow stooze at least initially.

Is there any behavior I should have on my credit file now to help me get the maximum stooze pot in the future?

I currently have a Capital One card with a £1.5k limit which pays 1% cash back and I spend £300-£500 per month on and always pay the full amount. I also have a Priority Rewards card with a £7k limit which I only made one purchase on (for the free points ) it needs to be canceled in the next 9 months to avoid a £99 fee.

I have also just applied for a Capital One Aspire World for the 5% in the first 3 months.

My credit history is very good, mortgage is 20% of my take-home salary and no other credit apart from a 1k overdraft and mobile contract.

I know some seasoned stoozers have stooze pots of over 100% of their salary. Are there any tips for getting such a large amount of credit?

Should I get more credit cards now and spend money on all of them?

Fingerbobs

Sounds like you're already building up quite a nice credit history.

The only thing I would say is that, if you open lots of credit cards now, you may find you are not eligible for any introductory rates on cards from those issuers if you want to start "fast" stoozing in the future. So I personally wouldn't open too many cards right now - just make sure you maintain the cards you already have impeccably - always pay off in full before the deadline, and never go over-limit.

But it all depends on what you want to do

jamesd

You might try getting a small personal loan, then repaying most of it. Then the regular low payments will make a string of positive entries on your credit report but you won't be paying much interest because you've paid most of it off. Don't use a loan that has an initial charge. This is potentially useful because it's a different type of credit from a credit card or mortgage and shows that you're using different types of credit as appropriate.

jimmyjones_2

@Fingerbobs - Thanks, I had not really thought about being ineligible for issuers offers if I go crazy and open lots of cards now.

@jamesd - That is an interesting idea but I feel that getting a loan and paying interest is counter intuitive - the whole point of stoozing it to make money from the system not to pay interest to the banks!

My credit history is already pretty good (5 out of 5 on noddle.co.uk) and I just got accepted for a Capital One Aspire World card which requires 'excellent credit history'. I just haven't used much credit in the last 6 years.

I was just thinking that certain behaviour like getting a few more credit cards with a higher combined credit limit and putting more money through them each month might help me get a bigger stooze pot in the future - maybe not

I will be putting all my spending though the Capital One Aspire World over the next 3 months anyway to maximise the 5% cashback offer!

jamesd

jimmyjones, if the loan is at 25% APR and you repay all but £5 after the first week you'd pay something like £3 in interest over five years. Easy to make more than that from stoozing if it gets you a higher limit. You can probably get a far better rate than 25% if you have a good credit record.

A 5 score at Noddle is excellent and not that common.

Putting more money through a card is a good way to get a higher credit limit, though it doesn't always work.

Joe_Bloggs

If you are using a 1K overdraft then, unless this is interest free money, you are not in a position to slow stooze. Slow stoozing is about spending an equivalent amount of money you have already earning interest in savings on essential purchases with a 0% for purchases card.

A season transport ticket for example is a worthy example of an essential purchase. Open up a 0% card a month before purchase to get the most benefit. To add icing take, out interest free loan for season ticket from employer and put this in savings.

The temptation to avoid is splurging money on things you don't need.

I find it strange that credit card offers seem to follow when I open up savings accounts. They seem keen to lend people money that don't need to borrow any of it.

J_B.

jimmyjones_2

jamesd... thanks, I get it now - I had assumed that you couldn't pay back personal loans early. I will look into a getting a loan.

J_B, i don't actually use the overdraft and I am certainly in a position to stooze. The only interest I pay to banks is for my mortgage and I am in a lucky position because I took out a lifetime tracker just before the financial crisis.

I understand what you are saying about the temptation to splurge money but I am pretty sure I will resist. It just be a case of using the credit card instead of the debit card.

My job is well suited to stoozing, I work for a consultancy and sometimes have £1500 of expenses per month so with that and my regular spending I should be able to slow stooze pretty effectively.

jamesd

jimmyjones wrote: »

jamesd... thanks, I get it now - I had assumed that you couldn't pay back personal loans early. I will look into a getting a loan.

All personal loan providers are required to allow both full and partial early settlement, by law. They can charge up to two months of interest on a loan with a duration of a year or more so don't go for a really huge loan or the cost of those months will be higher than necessary. Some charge nothing for extra payments or full repayment, though, just a case of checking and picking one of those with no charge for extra payments or picking a small loan size.