Best way to use credit card

nextyeartina

Hi. I've just applied and been accepted for a credit card to help improve my credit score. I was going to use it for some of the monthly essentials such as diesel then pay the money straight off the credit card. Or am I best waiting for the statement to come in, then pay it? Will I be charged interest if I wait for the statement?


TIA

[Deleted User]

Always wait for the statement, then clear in full before the due date. As long as you're not using cash advances, you won't pay interest.

Don't track your credit score as it isn't a measure of your credit worthiness and isn't used by lenders.

Willing2Learn

And just to add that the easiest way to pay the balance is to set up a Direct Debit. That way, the process is automated...

Terry_Towelling

Use the card for everything you would normally have bought with cash/debit card and pay in full by direct debit. The direct debit method allows you to make full use of the deferred payment period.

If you are worried about spending the money in your current account before the credit card bill is taken then set up a system whereby every time you make a credit card purchase, you transfer an equivalent amount from your current account into a savings account.

Then, when the direct debit is due, check the amount that will be claimed and transfer that much back from savings in time for the direct debit to go out. This way you are effectively treating your credit card as an extended pending transactions list and ring-fencing the money needed to pay it in an interest-bearing savings account.

If you are already using a high-interest current account there is no need to move the money anywhere - just make sure you don't spend it! If your current account allows you to open a linked easy-access regular saver paying more than the current account, then use that as your ring-fence fund - but do make sure the RS account is easy access. Bear in mind, most RS accounts restrict pay-in to typically £250 per month.