working out the best credit card.

lindos90

hi there, needing some advice please. And help settle an argument!!
We are currently trying to make our money work better for us, and MSE is a great resource, but I'm getting bamboozled with all the info!

We are thinking of dabbling in a bit of stoozing, so are looking for a good 12 month regular saver account and a credit card with 12 months intrest free.

We dont need to transfer a balance from any other credit card, and it looks to me like the HSBC credit card could fit the bill.

However my OH wants to find one that does cashback too, Ive told him that cashback creditcards do not do 12months intrest free periods and (as far as I know) its usually one deal or the other.

So, who is right? are there any credit cards that offer 0% interest for a year, that also do cashback when you spend??

I think my other half is crossing his fingers, but im sure I'm right (unfortunatley)

TheDink

I doubt very much that you will find a card that offers 0% on transfers, plus gives you cashback on purchases. You also need to be exceptionally careful if you are going to spend on a 0% transfer card. Purchases may have a different APR, or a different period for 0% interest. E.g. you might get 12 months 0% on your transfer, but only 3 months 0% on spending. Once that 3 months is up, you will be charged the standard rate on the balance of any spending on your card. Any payments you make will reduce the outstanding balance of the cheaper loan, leaving you having to either pay off the card in full to avoid paying interest on your purchases, or incur interest charges for 9 months on what you have spent. This could wipe out any savings you make by stoozing.

Before starting to stooze, you should also check the balance transfer fee on the card - these are generally between 2 and 3%. Work out if paying this fee still makes it worthwhile for you. Depending on the length of the 0% deal, the transfer fee can make the equivalent interest rate upwards of 5%.

NickX

Yes, as I have just posted in a different thread, this is the sneaky trick that the Credit Card companies use to battle the stoozers. They get you to Balance Transfer at a preferential rate, often of 0%, then they entice you to spend on the card hoping you won't realise that the spending will incurr interest until the Balance Transfer balance is completely paid off.

The only time when I would say it is ok to spend on a Balance Transfer Card is when the expiry of both the Balance Transfer promotion and the Purchases promotion are the same.

With regard to fees, they seem to be 2.5% - 3% at the moment.

Provided the 0% rate lasts for at least 12 months you should make a profit as you can make 6-6.5% in a high interest account. But do remember to take your tax status into account. If you are a higher rate tax payer stoozing probably isn't worth it unless you are offsetting mortgage payments.

YorkshireBoy

sarahllord wrote: »

I doubt very much that you will find a card that offers 0% on transfers, plus gives you cashback on purchases.

Here's one...

0% on both BT's and purchases (for the same duration), and also pays 1% cashback:
http://www.capitalone.co.uk/creditcards/capital-one-platinum-cashback-card.jsf

...and one from Barclaycard (although no 0% on purchases with this one)...

http://www.barclaycard.co.uk/personal-home/cards/platinum-hero/platinum-with-cashback/index.html

lindos90

Thanks for the quick replies!!
Im new to this so I probably used the wrong term, I realise now that stoozing is buying using 0% credit card, then moving the balance to another 0% before the end of the 0% ends, sorry, my fault!

We are not needing to transfer any current balance to a new credit card.

What we want to do is have a 0% credit card for 12 months, to buy food, petrol etc (paying minimum repayments each month) and then the money that would have been used to pay for food and petrol, put into a regular savings account each month for a year, then at the end, withdraw the lot, pay off the credit card (being very carful with dates and clearance times!!) and pocket the interest made from the savings account....(dont know the jargon to describe this plan, thought it was stoozing)

I'd be happy with that, but my other halfs argument is that he wants cash back AS WELL when we buy food and petrol etc on the CC, I dont think that is possible, I think he is being unrealistic, and perhaps a little gready!!

I cant find a CC that gives 0% on spending for 12 months AND also offers cashback, he says there must be, but he works full time, I dont work, an so he has set me the challenge of finfing one!

NickX

Hi There,

You were right - what you are proposing is called Slow Stoozing.

You need a good 0% Purchases card, and as you want Cash Back aswell I think maybe YorkshireBoy's suggestion of Capital One would fit the bill.

Capital One offer several different products so make sure that you get the right one for your purpose.

There may be others, I think a bit of research should get you a good deal,

Good Luck

CannyJock

lindos90 wrote: »

We are thinking of dabbling in a bit of stoozing, so are looking for a good 12 month regular saver account and a credit card with 12 months intrest free.

However my OH wants to find one that does cashback too, Ive told him that cashback creditcards do not do 12months intrest free periods and (as far as I know) its usually one deal or the other.

Best to go for two separate cards. A 0% low-fee balance transfer card for your stooze pot and a 0% purchase card with/without cashback. Best picks I'd say would be Virgin Money 0% for 15 months, 2.98% fee, and HSBC 0% purchase card.

YB mentions the Capital One card - I think you need a squeaky clean good rating to be accepted for this one and a few posts from people who applied for it then got sent a totally different card.

Think it's safe to say that it's not a one-size-fits-all solution for you, think about different cards for different purposes.

CannyJock

lindos90 wrote: »

We are not needing to transfer any current balance to a new credit card.

Think YB wins for the best recommendation then if it's a slow-stooze you're looking for

Once you've got that, if you don't need to transfer any current balance and you've read the articles on the pros and cons, then you'd be in a good position for a full-on stooze in addition to your slow-stooze