Advice for all round credit card

GuyBarrett

Hi there,

First time poster and having spent a few evenings researching and getting confused i thought it best to post my situation and ask for advice.

My background, under 25, full time employed with good job (27k pa) and £1600 (out of initial £4000) debt from a stupid loan i took out at high interest last year when between jobs and had a housing problem with a bad landlord. I don't currently have a personal credit t card and as i'm fairly young, my credit rating is average (370 according to Equifax).

I currently spend around around £4-5000 a month through business and personal spending and feel I'm missing a trick by not having a rewards based credit card. However i'd also like to get a credit card to pay off the outstanding loan amount and save a few £100 on the interest currently being paid.

Is there any card which will fit both purposes, or can anyone recommend which combination of cards i should go for??

Thanks!

Ben8282

Your anticipated monthly spend is quite high. I would strongly suggest that you apply to the bank which holds the current account through which this £4-5K pm passes each month. The reason I say this is quite simply because as you currently do not have a credit card of any sort, nobody else is likely to give you a card with the sort of credit limit (£10K at the very least) needed for this level of spending.
A charge card may well be more appropriate for this level of monthly spend due to the possible risk of your getting into debt if you get tempted not to pay the credit card balance in full during a particular month. However, I think that you would be unlikely to get one at this stage but it is something to think about for the future when your credit files show a history of consistent 4-5K pm spend and full repayment each month.
Regarding the loan, if you want to transfer this to a credit card you will need a 0% card with a money transfer facility which will have to be separate from the spending credit card, otherwise you will pay interest every month on your purchases.
Having said that, the other option would be that when (and if) you obtain a credit card for your monthly spending currently done by cash/debit card or whatever, you use the money unspent in month 1 to completely repay the loan, paying month 1 spending with month 2 money when the payment due date is reached. So long as the 4-5K monthly spend continues, this arrangement could continue more or less indefinitely.
To be completely honest with you, unless your own bank can somehow be persuaded, you are unlikely to get anything except a credit builder card with a credit limit significantly lower than your anticipated monthly spend.

grumbler

Ben8282 wrote: »

... The reason I say this is quite simply because as you currently do not have a credit card of any sort, nobody else is likely to give you a card with the sort of credit limit (£10K at the very least) needed for this level of spending.

Generally, the limit can be smaller. In this case the OP has to keep a close look on the balance and keep making payments to the card that can be almost instant.

I would suggest Aqua Reward paying 0.5% cashback, but it is notorious for extremely low starting limits, normally just a few hundred pounds.

SLZ

GuyBarrett wrote: »

Can anyone recommend which combination of cards i should go for??

Thanks!

You won't get a credit card for loan payments, few cards offer the ability to take out cash at 0%.

Now on the rewards side, ignore the suggestions about Aqua for now, what do you want from a card is it airline miles, hotel points (status), cashback or general points that can be put towards things from travel to bills?

If you're interested in airline miles, what airline do you fly the most? British Airways is the most widely available for earning in the UK but you can get cards from the likes of Emirates, Etihad, Lufthansa etc.

If you're interested in hotel points do you stay at Hilton, IHG, Marriott or Starwood the most? This is actually the easiest one to suggest, the only cards currently available are actually Hilton HHonors (Visa) and Starwood's (AMEX) both come with sign up bonuses and status.

Cashback, you'd be looking at Santander and American Express for best payouts.