Should I get a credit card?

CurryCee

I've always been raised to think that credit cards are essentially evil, and the bank's way of getting you to spend money you don't have.

That being said, I'm beginning to change my attitude a bit, having realised that credit history will be an essential tool to leverage large purchases in the future.

So, should I get a credit card? At the moment, I seem to be doing fine without one. I've got a debit card and everything seems to be tied up in a nice little bow money-wise.

If I am to get one, which one should I get, and how should I go about using it effectively to build up a good credit score, without having to pay unnecessary interest on things?

DreamerFTB

Get one that hasn't got high APR, check with your bank. Set up automatic full monthly repayments and you don't have nothing to worry about. You'll basically handle it like a debit card but your credit rating will improve.

As long as you pay it monthly you don't have anything to worry about.

CLAPTON

CurryCee wrote: »

I've always been raised to think that credit cards are essentially evil, and the bank's way of getting you to spend money you don't have.

That being said, I'm beginning to change my attitude a bit, having realised that credit history will be an essential tool to leverage large purchases in the future.

So, should I get a credit card? At the moment, I seem to be doing fine without one. I've got a debit card and everything seems to be tied up in a nice little bow money-wise.

If I am to get one, which one should I get, and how should I go about using it effectively to build up a good credit score, without having to pay unnecessary interest on things?

whatever does 'leverage large purchases ' mean : get in a large debt and pay lots of interest?

forgotmyname

Get a card, Use it, but make sure you pay it all off every month.

Deru

Get a credit builder card like Capital One Classic, Barclaycard Initial , Vanquis or Aqua. Spend a bit on it each month, clear the balance each month.

Set up a Direct Debit so you don't miss payments. These cards usually have higher APRs but if the goal is to just build credit and not leave a balance, it doesn't matter. Costs nothing if you clear the balance.

Maggie.Moo_2

I was raised with a very similar attitude but I took up the Experian free trial for £10 cashback and found that my rating is only 'Fair' as I've never had revolving credit. I recently tried to extend my overdraft and switch bank accounts but got rejected from both of them after credit checks just because I've never needed to borrow money before (I understand this from a business point but it feels unfair on a personal level). My friend mentioned a few years ago that he had a credit card which he'd only spend £10 on per month and then pay it back straight away as a means of improving his score but I was still too scared to give it a try. Now I regret that!

My Experian free trial allowed me to use CreditMatch to see what credit card I would most likely be accepted for. I opted for the Aqua as it approves 90% of applications including people on low incomes with poor credit ratings as well as giving access to credit reports. I was accepted but they haven't informed me of the limit yet (it's somewhere between £250 and £1,200) and I'm a little worried as I just read a thread from someone who was accepted then rejected. I can't remember the APR but I fully intend to pay if off in full every month so that doesn't really matter. It's also worth remembering that you can sue the credit card company for unsatisfactory purchases over £100 (I'm sure MSE has more detailed/accurate information about that).

Bottom line is yes, definitely get a credit card and from what I've read Aqua seems to be pretty decent as stated above. Good luck!

PS. Experian says that you need at least 12 months of revolving credit history for a positive impact so definitely start sooner than later

PeacefulWaters

Are you sensible or impulsive? If the latter, don't do it.

A credit card, used in a controlled and intelligent way is a wonderful thing.

Get one that pays you a reward. Tesco might be the best starting place for this, then progress to something better in time (see links at the top of the page). If declined, look at your own bank's offering if it's fee free.

Pay for everything you can with the card. But only your normal spending. No extras. Clear the balance fully when the statement comes. Don't use for cash. Don't pay interest. Ever.

Dustykitten

Deru wrote: »

Get a credit builder card like Capital One Classic, Barclaycard Initial , Vanquis or Aqua. Spend a bit on it each month, clear the balance each month.

Set up a Direct Debit so you don't miss payments. These cards usually have higher APRs but if the goal is to just build credit and not leave a balance, it doesn't matter. Costs nothing if you clear the balance.

Please can you explain why this is different to just getting a regular card?

I think it would be good for my DS1 to have a card to start building a credit history. Would explain to him the idea of DD, small spending, paying in full but would have leaned towards one which gave some benefits back like tesco or JL.

[Deleted User]

The rewards oriented cards are more difficult for those with poor or no credit history to get.

The likes of Vanquis and Aqua cater this market.

20aday

If you'd like to earn cashback on your credit card you could consider Aqua's Reward card?

They are offering 0.5% (which isn't great in the grand scheme of things, granted) with a Rep. variable APR of 34.9%(which won't matter when you are paying your bill in full each month).

If you shop at Tesco regularly they offer the Foundation card with a Rep. variable APR of 28.9%.

Deru

Yep, as above, they are easier to get.

I also figured if you're new to cards, a reward card might tempt you to spend more on them and risk racking up a big bill. I put pretty much all my spending on my rewards cards (but I clear all balances). I didn't want to suggest something that would tempt someone into getting into a mess.

On the subject of credit score / history, there's a site called Noddle.co.uk that lets you see your credit record for free so you can monitor ongoing. It's that or experian and the like, take up the trial offers, which are a bit annoying as you have to phone up to cancel and on time or you get charged.