Advice for getting first credit card? :)

Lottie92

Hi there

I'm 21 and looking to get my first credit card as a way to start building my credit rating, and was just hoping someone could help me clear a few things up that I'm unsure of!

I currently have a student bank account with a £200 interest-free overdraft. I'm good at budgeting, but have gone into this a few times (never over it!) because I keep my student loan in my savings and transfer it to my main account when needed (never in the minus for more than a few weeks, and always have had a few hundred to spare in my savings anyway). Does having or using this overdraft affect my credit score at all?

Also, I pay for my phone contract each month (nearly for 2 years now) and rent payments go out by scheduled direct debit. I've searched around a bit online and asked people I know but there seems to be some disagreement on what can affect your credit rating - anybody here know for sure? All have been paid on time

I keep getting letters from Barclay's (my current bank) saying I am 'pre-selected' for their initial credit card and I have looked on this website which says it is a good initial card so figured I will go with that. However, even though I'm 'pre-selected' should I still use this sites eligibility checker (I get apprehensive about putting in personal details online and such, only do when necessary).

Just one more!
Is it actually worth getting if I don't plan to spend much on it? I don't want to end up getting carried away with it or anything like that and plan to use it just for a few purchases (maybe up to about £50 a month) - but would this be worth it, would this much actually help my credit rating? (Wouldn't be using more because I dont really spend much outside my rent anyway, maybe just over £100/month while at uni, a bit more in summer when Im working).

This went on a bit longer than expected, sorry it's just a bit daunting to be honest

Thank you

PeacefulWaters

Your plan is spot on.

Small but regular use cleared each month is exactly the approach to take.

Lottie92

PeacefulWaters wrote: »

Your plan is spot on.

Small but regular use cleared each month is exactly the approach to take.

Ah that's great then thanks!

I've heard that you have to set up direct debits to pay it off each month, if I spend a different amount each month should I do a direct debit for the minumum repayment or can you choose to do it to pay it all off in full each time (preferable option!)?

PeacefulWaters

Lottie92 wrote: »

Ah that's great then thanks!

I've heard that you have to set up direct debits to pay it off each month, if I spend a different amount each month should I do a direct debit for the minumum repayment or can you choose to do it to pay it all off in full each time (preferable option!)?

Direct debit is optional.

But I'd suggest setting one up for the full amount. Ensure you leave the money in your current account to cover it. The date will vary each month.

thebritishbloke

PeacefulWaters is spot on about the credit card.

In regards to your overdraft, I've pretty much maxed my £1,500 student overdraft (In a savings account). It's not caused me any problems with getting credit, I've always repaid my credit cards in full.

Scott_1701

I was actually about to post the exact same thread as this. Pretty much in the same position as yourself. I have just graduated uni and am about to start a 6 month paid internship.

I was wondering what the best credit cards are for people in our position? I'm quite good at managing my money and won't be going daft spending a lot. Mainly just looking for a card to get a credit rating. I don't have an over-draft and don't pay for my phone bills so i'm not sure how this will affect me getting my first credit card either.

any advice much appreciated!

thebritishbloke

Scott_1701 wrote: »

I was actually about to post the exact same thread as this. Pretty much in the same position as yourself. I have just graduated uni and am about to start a 6 month paid internship.

I was wondering what the best credit cards are for people in our position? I'm quite good at managing my money and won't be going daft spending a lot. Mainly just looking for a card to get a credit rating. I don't have an over-draft and don't pay for my phone bills so i'm not sure how this will affect me getting my first credit card either.

any advice much appreciated!

My guess is that you have zero credit history, in that case you're going to have to go for a sub-prime card. Are you in the electoral roll?

If so, try for a BarclayCard Initial or Capital One Classic. If you get rejected for those, you're going to have to go for one of the really sub-prime cards such as Vanquis or Aqua.