Which Type of credit card is best for me?

combatrock

Hi All,

After years of paying for everything up front from my current account, i decided it would be beneficial to have a credit card. I work casually for a university and some months my income is fairly low, others it's pretty high: so i figured a credit card would be useful to bridge these gaps.

However, i'm quite confused on what would be a good first card (actually i have a student one with tab but have never used it). Due to the fact that i intend to pay it off on time every month, i'm not sure i would benefit from a good rate purchase card, i have no previous debt so i don't see any benefit of a balance transfer card and i'm not sure i spend enough (300-500 PCM) to benefit from a rewards card.

Could anyone advise?

forgotmyname

The rewards add up over time. It maybe a small amount but with the right bank account also it adds up.

I was lazy and took the easy option of leaving everything as it was. But then started to change my account to a reward one. OK its only £5 a month but thats £60 a year. Add a reward card and it will be over £100 a year. Easy money that you didnt have and with little effort.

If you pay it all off every month without fail then its not an issue to have a card with a higher interest rate.

If you can get a reward card then its worth trying to get one.

combatrock

Thanks for the advice. Which reward card would you recommend? As i said my sending is generally fairly low and i don't drive (i know some reward high on fuel ). So maybe a cashback card would be best? What do you think?

PeacefulWaters

You might be best starting off with Tesco or M&S if you ever shop there.

http://www.moneysavingexpert.com/credit-cards/cashback-credit-cards?&_ga=1.171382752.1116300417.1393518509#Marks

combatrock

I could probably make use of either, it looks like the M&S one might be slightly better though?

grumbler

combatrock wrote: »

...i figured a credit card would be useful to bridge these gaps.

Not really. Credit cards are good only if you pay the balance in full every month.

PeacefulWaters

combatrock wrote: »

I could probably make use of either, it looks like the M&S one might be slightly better though?

Cash value yes.

It depends how you choose to leverage your Tesco points though.

andyfromotley

I would definitely pay attention to the interest rate that you get. You say that your income is variable. What happens if say you get 4 months in a row with low income. Are you sure that you can pay in full each and every month? Without fail? If you are absolutely certain that you can then i would suggest that you don't really need a card.

If you fail to this even once or twice then this will demolish any gains that you make via rewards.

If you are determined to have one i would go for the lowest rate you can find just in case you find yourself in the above situation.

combatrock

Hi Andy, my income is variable but predictably variable. I know which months i won't have nay income and on the other moths i make a great deal more than i need, so i can usually balance it out fine. I don't actually need a credit card, i've managed this long without one and never struggled much. However, i just thought it may make life easier for times when i could use extra cash, as well as helping to build a credit history and potentially providing rewards on purchases i make every month anyway (like shopping and bills). What's your thoughts?

andyfromotley

Hi combat,

unfortunately you're talking to a bloke who managed to fritter away 23k on credit cards (whilst earning 3-4 times the average salary!!) so you'll gather i'm not the most impartial person to ask.

My POV is really if you don't need one don't bother. If everything else is in order you credit history will do fine without one.

molerat

I am a relatively low spender but received £192 from my cards last year. I have one card that has an eye watering 31.1% APR, no problem as it is paid off monthly and they give me 4%. I hardly ever spend cash, almost everything goes on card and paid in full by DD. Managed properly it is not a problem and larger purchases have S75 protection as a bonus. Credit cards are not the problem, people with no control are.