Credit Cards

markwilliams82 · 3 Sep 2010 at 09:54

Hi everyone, I've never had or intended to have a credit card before but now that I've got a house and I'm planning on doing some DIY work in the next month (cellar conversion) I'm wondering whether it would be a good idea to get one.

I've got money saved to pay for the basic conversion, but obviously there is also the electrics that need to be installed, the room to be plastered, laminate floor fitted and some new furniture. To save for all of that would take ages, and I'd end up with one of those rooms you'd see on DIY SOS that just turns to ruin because I'd end up spending the money on other things.

I'm just wondering whether it would be worth having a credit card for paying for all of the above, but I'm just worried that repayments might be too much or what problems it could cause having a card

Any advice would be grateful

Archy · 3 Sep 2010 at 09:57

Personally I'd be doing it little by litte as you can afford it.

Don't use credit cards to fund stuff you can't afford. I have a credit card, but the balance is paid off in full at the end of the month. They are useful things when used wisely, which most people don't imo.

Sp00n · 3 Sep 2010 at 09:58

Don't treat a CC as a loan, treat it as a debit card which should be paid off every month.

This is my advice.

hood1971 · 3 Sep 2010 at 11:05

Sp00n said:
Don't treat a CC as a loan, treat it as a debit card which should be paid off every month.

This is my advice.

Most people don't even treat them as a loan - they never budget to pay them off in a set period, rather opt to pay minimum balance and occasionally pay a lump sum at the balance. Then buy more soon after.

If you use credit cards wisely they can be a boon. If you need to use them and not pay them off at the end of the month ensure you budget to cover the balance in a reasonable time. Set a direct debit and stick to it. The only problems with credit cards is the users themselves seeing it as free money to dip into when they like.

If you can get one with a 6 month free interest rate it would be cheaper than any personal loan, but like I said above budget to pay off balance before the ridiculous %apr comes into effect. On the plus side you can improve credit scores by having one.

Bleek · 3 Sep 2010 at 11:11

Just postpone the work for a few months and save!

I'm in my late 20's now but when I was younger I had 14 credit cards and a loan, I managed to rack up 30K+ of debt, thankfully I've paid it all off this year because I've done 'well' with my new business.

However, if I could turn back time the last thing I would do, ever, would be to get a credit card for anything other than dire emergency. It's far too easy to slip in to the mindset of paying minimum and 'next month I'll pay a lump' because next month never comes.

I can't express to you how amazing it feels to be free of debt burden, I never want that to change.

bledd · 3 Sep 2010 at 11:54

I spank a few hundred on mine every few months, then I just pay off around £75-200 a month, depends how rich/poor I'm feeling

Edrof · 3 Sep 2010 at 12:32

I only use mine when a purchase makes me want extra protection - ie something pricey from the interwebz.

cyclops12 · 3 Sep 2010 at 12:53

Sp00n said:
Don't treat a CC as a loan, treat it as a debit card which should be paid off every month.

This is my advice.

This ^^

Ive had a couple of cards for the last ten years or so and never paid a penny in interest , use them every month.

I'm supprised they renew them but they do.

Vonhelmet · 3 Sep 2010 at 13:00

Forde said:
I only use mine when a purchase makes me want extra protection - ie something pricey from the interwebz.

Yep.

My dad said to use a credit card for convenience, not credit i.e. it's accepted everywhere, has better fraud protection, and means you can pay for something before the funds to actually pay for it properly have cleared.

Basher · 3 Sep 2010 at 13:13

vonhelmet said:
Yep.

My dad said to use a credit card for convenience, not credit i.e. it's accepted everywhere, has better fraud protection, and means you can pay for something before the funds to actually pay for it properly have cleared.

Indeed. I use mine for absolutely everything (cashback

) and pay it off in full every month.

DB_SamX · 3 Sep 2010 at 13:19

Basher said:
Indeed. I use mine for absolutely everything (cashback ) and pay it off in full every month.

+1

Amex Platinum cashback.

Got £200+ back in my first year, this one hopefully round £75.

Basher · 3 Sep 2010 at 13:29

DB_SamX said:
+1

Amex Platinum cashback.

Got £200+ back in my first year, this one hopefully round £75.

Yep, same. Am getting around £120-£150 a year back now. Also use egg (1% back) for anywhere that doesnt accept Amex.

Hades · 3 Sep 2010 at 13:52

A lot of places don't take Amex so another alternative is the Lloyds TSB Duo card. You get an Amex and a Mastercard for the same account. The Amex gets more airmiles than the Mastercard but you can use the Mastercard in places that won't accept Amex.

MajorMaccas · 3 Sep 2010 at 13:56

cyclops12 said:
This ^^

Ive had a couple of cards for the last ten years or so and never paid a penny in interest , use them every month.

I'm supprised they renew them but they do.

Your credit score is suffering because of this, though it doesn't sound like you need credit :rolleyes:

Basher · 3 Sep 2010 at 14:02

The_Sophisticate said:
Your credit score is suffering because of this, though it doesn't sound like you need credit

Credit reports include current balance, credit limit and whether you've made payments to your credit card company on time; 80% of your credit score is derived from these three factors.

If you maintain a low balance relative to your limit and you make payments on time, either because you're slowly paying down an existing balance or you're paying off your charges monthly, your credit score will remain intact.

Captain_Slick · 3 Sep 2010 at 14:04

If you can definitely afford to pay it off when the 0% on purchase period is up or at the end of every month, go for it.

Ironic Namesake · 3 Sep 2010 at 14:23

Why don't you budget exactly how much you need, then get a loan for that amount? At least you won't be paying high APR.

Otherwise I'm sure there's some 6-12 month interest free deals going around - just make sure you pay them off in full, before that interest free period ends !

I use cards to pay for everything, only use cash when absolutely necessary. Better protection, reward points (HSBC) or if I use UK cards like Airmiles Duo, I get airmiles

cyclops12 · 3 Sep 2010 at 14:37

The_Sophisticate said:
Your credit score is suffering because of this, though it doesn't sound like you need credit

Dont like to get stuff if i cant afford it , put 90% of everything i buy on the card + my monthly bills food ect then just pay off in full when the bill comes in.

When i have got stuff on credit i've never had a problem or been refused , for the bigger stuff ie my trike i get a bank loan , everything else it's just as easy to save for a few months as it is to pay back credit , and it's cheaper

Mark M · 3 Sep 2010 at 14:38

Nothing wrong with a credit card, pick one which has 6-12 months interest free on purchases offer and providing you can afford the budgeted repayment you'll be fine.

I did this when I moved in and it meant I could do virtually the whole house, 6 rooms @ £500 approx instead of 1 room a month and have to the whole place a tip for 6 months.

hawker1986 · 3 Sep 2010 at 14:40

Archy said:
Personally I'd be doing it little by litte as you can afford it.

Don't use credit cards to fund stuff you can't afford. I have a credit card, but the balance is paid off in full at the end of the month. They are useful things when used wisely, which most people don't imo.

100% Agree with Archy, do it as you can afford, credit cards are useful for emergencies or if you pay them off monthy, otherwise its just asking for trouble.

Hawker