Credit Card in Retirement

Qyburn

Thanks.  I've never thought in terms of daily credit card spending.  There must be days on end where there is none.  Looking at my records for a bit less than five years the monthly spend on the two cards together averages just over £1600.  But that includes some purchases that are planned well in advance so plenty of time to make sure the CC bill is covered.  Typically those are put on American Express in order to get that 1.25%. 
I guess based on that history I'd need to maintain the current account with about £2,000 more than we do at the moment. 
As compared to using the credit cards where I review at the start of the month with a few days to go before the DD direct debit, and of course at that stage the two CC bills are known.
So I'd miss the credit card just for that convenience.

Brie

I'd stop and think about what you plan to do in retirement.  A lot of travelling?  Then you might want to look for a card that has no foreign exchange fees.  

And I'd be cautious about Barclaycard only because they have been very strict in the last few years about proving income.  It's fine to apply while your still working but they may take umbrage once you are living off savings.  Even before I stopped working they reduced my limit by 90% despite me having an income 3 times higher than when I took the card out.  Granted there was a couple of decades in between and I don't think income was a question when I applied.  Of course other banks may have become stricter as well but B's is the only VISA card I hold.

blue.peter

Qyburn said:

Thanks.  I've never thought in terms of daily credit card spending.  There must be days on end where there is none.

Yes, I can understand that. I'm the same. But then there'll be a day like the one I had a few weeks ago.

I went to collect my car from the garage (major service + MOT test + a new tyre), and was presented with a bill for over £500. There's no way that I could have paid that with a debit card, since my current account only held about £50. And, of course, I doubt if the garage would let me take my car away until I'd paid them.

That garage (the local VW main dealer) doesn't accept American Express. So if my MasterCard couldn't be used, I'd have been very glad to have my Visa credit card with me.

Qyburn

Yes the garage that we use doesn't take American Express either. However they do give us the full all-in bill over the phone before we collect the car.   Those are the biggest bills that go through Mastercard at the moment, and although we know in advance it's not that much notice if I had to transfer money to the current account.  However a credit card with a low credit limit wouldn't help either.

blue.peter

Qyburn said:

However a credit card with a low credit limit wouldn't help either.

Well, that rather depends on what you mean by a "low credit limit". I think that he lowest I've ever had is £3,500, so that's what it means to me. Even that would have been more than sufficient in this case.

But, yes, a credit limit of the order of £200 wouldn't help in the circumstances that I described. On the other hand, do you have reason to think that if you were to apply for a Visa now, that's the sort of limit that you'd be offered? Is that consistent with your current MasterCard limit? IME (see here), Visa credit limits tend to be higher than MasterCard ones.

Qyburn

My Mastercard limit is currently £2,500.  It was £1,200 initially, increased to £2,700 in the same year, then to £4,200 and then more recently back down to £2,500.  I guess because we weren't using that limit.  Over the years the maximum month on Mastercard was just over £2,000, and there've been a few months with nothing.

American Epress limit is £9,300, maximum statement balance was £2,700 and minimum £523.