Do you have a credit card?

BodieGirl

Hi Guys

Not posted for a while, debts are cleared now yay! Still have one credit card left, £0 balance but £1500 credit limit available.

Planning to close account, but scared to not have any safety net as dont have any savings built up yet. The thing is, whenever I have had credit available to me in the past I've ended up using it, planning to pay at end of month and then something crops up!

Should I just go for it and cut it up? Will have approx £200 to payday middle of Dec which sounds like loads but got 2 day trips and 2 xmas parties inbetween.

Thanks

rising_from_the_ashes

I have one .... I buy everything on it but it is cleared, in full every month - it's how I budget (as I am terrible with cash) and it works for me.

Personally, if I couldn't trust myself to do that - I wouldn't have it.

It can be a good way of rebuilding your credit - if you're not sure, try it for a set thing, something that comes up every month but isn't a huge amount eg fuel.

If you find you're starting to use it for other things, or don't clear it one month - get rid! (and so not worth getting back into debt for!)

Now might not be the best time to start as things are always tight from now until often the end of January - why don't you put it away somewhere safe until the beginning of Feb and give it a try then?

ETA well done on getting DF!!!!

LadyV2508

You could keep the card but maybe reduce the limit on it? Ive just got the 1 credit card now and it had £1,700 limit and i reduced it to £500 - its there for emergencies only and luckily ive not needed it for a long time!

BodieGirl

Thanks for the reply!

Doesnt that technically mean that you are a month behind though, moneywise? I.e. if you pay your card on payday, you then need to use the card throughout the subsequent month as your wages have paid off last month?

Thats what Im trying to avoid if you see what I mean?

fozmcfc

Well done on becoming debt free.

Credit cards can be a good thing, if used correctly.

I would say that you have done so well, but still seem like you can't trust yourself to not over spend to the point, where you end up with debt again.

It is good you recognise that, but sadly, that means, you probably need to ditch the card for your own sake, or really learn to live within your means.

Ok, so this year Christmas, money is a bit tight, but that's because you have been paying off debt. If you learn to budget and save, it won't be the same next year, because you won't have been paying off thousands towards debt.

Hopefully you will learn to budget and then if you can trust yourself with a card, go for one that gives cashback back or one that gives vouchers such as Tesco or M&S cards.

If you pay them off in full each month, you'll pay no interest and have the benefit of vouchers as well.

EDIT....Good advice from Ladyv2508, about getting the limit reduced, then you can't run yourself to much over if you do need to buy in an emergency.

rising_from_the_ashes

BodieGirl wrote: »

Doesnt that technically mean that you are a month behind though, moneywise? I.e. if you pay your card on payday, you then need to use the card throughout the subsequent month as your wages have paid off last month?

Thats what Im trying to avoid if you see what I mean?

Ahhhh that has been an issue!:o

I now have budgeting "pots" that I put money into each month (house & car and pets) which have built up a positive balance. When I get the cc bill, I transfer the relevant sum from whichever pot to cover those spends.

Working well with the ones I've got going but still to really sort out the "others" pot (dentist, clothes, hair, presents etc) as haven't yet managed to get this one off the ground.

Fuel & groceries come out my main account - so technically 2 weeks in arrears with those ones (cc bill runs to 17th of month & paid last working day) - 2 weeks behind isn't really a major concern to me.

Although I will be working on getting the remaining budgeting pots set up in 2013 - it was just too much to try to do them all at once in one year as it does involve a bit of overpaying to get them into positive balances.

[Deleted User]

No I haven't.

I'm just coming to the end of a 4 year bank loan, courtesy of my exploits with Credit Cards.

Never again.

4321smokey

Some really good advise out there, I have a cashback card as well as a credit card. I use my credit card very little (just the one), just enough to score on my credit profile.

My cashback card I load with at least 50% of my wages (pre-pay card) I don't earn a great deal, I use it as my debit card and get up to 8% cashback per month (that's two weeks of free fuel per month). It's a great saving.

Reply to an earlier post; Do not get rid of all credit cards, keep at least one to show that you are credit worthy. As for those with too many, apply for any more and caution marks will appear to prospective lenders. You will be refused and bang goes you credit rating.

I am no expert but do try to use the system to my advantage.

BodieGirl

Thanks for the replies guys

Ashes - you seem very organised! I need some pots myself with savings etc - I have different accounts for bills/rent/food etc but things always crop up when least expected.

Im gonna go for it and close the card. If a REAL emergency came up, I have my partner and at worst my Dad i.e. Im sure he would lend me the money in a life or death situation.

Sadly I do not trust myself, Im good most of the time but old habits die hard and I really need to learn the value of money, which I should do anyway seeing as I work in a bank!

This Jan I owed loads, on Next, credit card etc, looking forward to debt free (although skint) xmas. But it means i will be buying presents that people deserve - last year for example I bought my daughters swim coach a £50 quid bottle of perfume on my next account as I had run out of cash! I still feel sick when I think about it - she's getting a £3 box of chocs this year! :rotfl:

BodieGirl

smokey - do you mean that you have a pre-loaded credit card? Do you use it solely for the cashback, and where can you use the cashback as i might look into one of those

carousels

Cut up your card but don't close your account. That way, you still have a back up without it being available immediately to spend. If that makes any sense?

It's kinda like freezing your credit card in a block of ice. If you need to use it, just call up your credit card company and request a new one. ( Just say your old one went through the wash and the chip is damaged or something. ) It normally takes seven days for a new card to come through the post so you'll have that time to think about whether you really need to use it.