Beginner w/ Credit Cards / Aqua

HP_123

Hi everyone. I have been doing some research on credit cards and building credit rating for the future , however I am still a bit confused with the whole concept. I am a university student with a good paying part time job and depending my income floats from 350-900 per month , without the additional SFE (Student Finance). Ideally I want to build my credit score from now so perhaps i will have better access to better loans and even a better mortgage in the future. Among my research , last year I was told I could not finance something as my "credit score is bad" regardless of me never having a credit card. It went ahead and was put under my fathers name despite me paying it all by transferring the money. I want a credit card to build score and just that , so I would put little monthly standing orders like a phone bill, Spotify and even small food shops. Currently I bank with Monzo.

It looks like Aqua is the only place offering me a credit card , with a 49.9% annual interest which to me seems high? But I do not know as I am a bit unaware of the whole procedure. If I was to go ahead with this and assume they gave me a balance of £500 , and I used £40 a month and paid £55 off fully monthly before the closing dates would this boost my score? If my maths is not wrong the total amount paid that year would be £610 with the interest.. Or should I be aiming for more substantial amounts? 
Any help and advice would be appreciated , specially on how Aqua deal with newcoming customers and any general advice on credit cards generally!

eskbanker

You don't pay interest at all if you settle your monthly bill in full, and this is also recommended for credit-building purposes, although don't obsess about a score that no lenders see.  There are plenty of good articles on this site which are worth reading and digesting, in particular:
https://www.moneysavingexpert.com/credit-cards/how-do-credit-cards-work/
https://www.moneysavingexpert.com/credit-cards/bad-credit-credit-cards/
https://www.moneysavingexpert.com/loans/credit-rating-credit-score/

JustJane101

I have an aqua and capital one card, both ised to increase my credit scores. Capital one shows on experian and aqua on trans union. I use about 20% of my available balances on fuel, food etc and my direct debit clears the full amount each month so i don't incure interest.

abc.xyz

Why are you banking with Monzo? You're missing out on the generous student overdrafts and student credit cards that high street banks offer. Yes, 49.9% is very high. But, if you set up a direct debit to pay the balance off in full each month, you won't pay any interest. Maybe I'm reading your post wrong, but why would you pay £55 on a £40 balance? That would put your account in credit. I strongly suggest you do some research on how credit cards work before you apply for one. Never go above your credit limit or withdraw cash at an ATM.
If you haven't already, I'd also suggest you look at your three free credit reports using the below links:
https://clubs.moneysavingexpert.com/creditclub/register (Experian)
https://www.clearscore.com/ (Equifax)
https://www.creditkarma.co.uk/signup (TransUnion)
Perhaps what they mean by saying you have "bad" credit history is that you have no credit history.

D3xt3r5L4b

JustJane101 said:

I have an aqua and capital one card, both ised to increase my credit scores. Capital one shows on experian and aqua on trans union. I use about 20% of my available balances on fuel, food etc and my direct debit clears the full amount each month so i don't incure interest.

The bold highlighted above is bad practice...

sasha20

To clear up some of the above...

If you don't already have a credit card of some sort, then even an aqua card with 49.9% APR will be good for building your credit.

The way you are planning to use it is exactly the right way - use it for regular purchases that you would have done anyway, repay the card in full every month, don't miss any payments, be careful not to go over your limit (it's going to be low at the beginning!) and don't do things like withdrawing cash, gambling or other similar transactions on the card - these are reported to the bureau separately as cash transactions, incur high fees and interest and will not help with your credit building.

If you pay in full every month (at least the amount on your statement), you will not have to pay any interest at all.

If you do all of the above, your credit will improve over time and you will be able to get better credit cards that actually come with perks and benefits.