Just a quick one - tesco credit card

bleeve

I am on tesco credit card, 0% on purchases for 16months I am just wondering, if I buy fuel/petrol say I top up 20.00, is this classed as a 'purchase'??

Also if I were to pay for example a phone bill, would this be a purchase or a transfer or what?

I've never had a cc before haha :rotfl:

Thank you

mrs_T

Purchases, balance transfers are where you pay off an existing balance from another credit card.

vacheron

Every product or service which you pay for using your card is classed as a purchase. However "cash-back" and currency withdrawals are not.

Therefore, try to use your card as often as you can for things such as those you mentioned (which are both definitely purchases) but when paying always make sure that you aren't charged an extra premium for using your credit card for certain things (often found when paying bills, buying travel tickets etc) which may make the interest free benefit less worthwhile.

longtermplanner

If this is your first credit card, perhaps this feels like free money? It isn't, it does have to be repaid. You are borrowing the money not from the bank really but from your future self. Routine spending like petrol should be paid for each month not accumulated leaving you with hundreds or thousands of pounds of debt at the end which you then have to refinance.

If you didn't need the 0% purchase card to be able to afford one large item, then do yourself a favour - pay it off in full each month. The pathetically small amount of interest you might lose by doing this is easily outweighed by the simplicity and zero risk.

vacheron

I agree that discipline is necessary but I wouldn't write off the benefits of day to day spending at 0% so quickly. I am currently earning £1135 per year from carrying the weekly shop, petrol, and other day to day expenses on 0% cards, hardly a "pathetically small amount"... At least to me ;-)

Although the OP may just be starting off with managing credit hopefully they will learn the discipline necessary early on which will set them up well for life. And registering on MSE is, to me, a very encouraging beginning :-)

shireknight

While you're in your interest free period get used to paying off your balance in full every month, if one month you can't clear the entire balance then next month put a mental credit limit on your card of half of what you normally spend on your card in a month to ensure the balance is cleared that month instead.

I've had a Tesco credit card for about four years now and I've only failed to clear the entire balance on two occasions and both times it was like a dagger through my heart seeing interest added on the following month.

Plus it doesn't only effect you for one month like you would think, if you don't clear your balance one month then they actually charge you interest for the next two months.

One other thing, don't use your card on the very last month that your interest free rate expires, Tesco have a little con going where they charge you interest for any purchases made between the date your interest free period ends and your next payment is due (even if you pay the outstanding balance off in full like normal) they caught me out with it.