Do I need a credit card?

Thrugelmir

Focus on where you save your money for the deposit. Both Halifax and Nationwide offer FTB schemes. This is better than playing around with credit cards if you've no real need for one.

zagfles

Credit cards are useful even for people with no need for credit.

They're a good way to budget - time the payment date to be just after you get paid and set up a full payment DD.

You can get cashback.

You get extra protection when you buy stuff (if the company goes bust/doesn't deliver you can usually claim against the CC company).

When staying in hotels or hiring cars, a reserve is often put on your card for more than you'll spend, with a debit card the reserve is against your real cash, with a credit card it just uses up some of the credit limit.

If your card is stolen/used fraudently, you have more protection with a credit card and you shouldn't be out of pocket as you might be with a debit card.

Thrugelmir

zagfles wrote: »

They're a good way to budget - time the payment date to be just after you get paid and set up a full payment DD.

That's how many peoples financial problems start. As by using a card they have already borrowed next months income. Then something unexpected happens, so a little more is borrowed. Balance isn't repaid in full. Which incurs a slug of interest. And so on.

zagfles

Thrugelmir wrote: »

That's how many peoples financial problems start. As by using a card they have already borrowed next months income. Then something unexpected happens, so a little more is borrowed. Balance isn't repaid in full. Which incurs a slug of interest. And so on.

What if something unexpected happens and you don't have a CC? Payday lender at 2531% APR?

dresdendave

zagfles wrote: »

What if something unexpected happens and you don't have a CC? Payday lender at 2531% APR?

Although it doesn't seem to fit in with the modern approach to finance..............dip into the emergency fund you have saved up?

Anthorn

Depends on what you want to do with it: If you want to extend your income by maintaining a balance, or have instant credit or you need to build or rebuild your credit history then a credit card is a good idea. But if you just intend to build up a balance and then clear that balance every month then it's no different to a debit card.

Incidentally, in relation to a CRA (Credit Reference Agency) there is no difference between maintaining a balance or clearing it every month. The only difference is that by clearing your balance every month you avoid paying interest.

anotheruser

I use the Santander 123 credit card as it pays us well over £100 a year back.

However I have just started using my Clarity Credit card, which usually I use for abroad only but I need to use it or they may close my account.

However on a daily basis, I use my debit card, apart from those places (supermarkets and petrol) that the 123 card gives me cash back.

Get one, have a low limit on it and use it for the odd thing. Just remember (as others have said) to set up a Direct Debit to clear the whole balance. If you spend less than £100 on it then I doubt it would get you into any trouble.