Best way to change your credit card habits in the new year

By Admin Jan 28th, 2013


We’ve been through the 0% balance transfer craze of current years and now banks are finding new methods to feed our card addiction with cashback and bonuses. Average credit card debt fell in 2012 however with some cards you can obtain a better rate of interest when compared to a personal loan or overdraft for up to 24 months. You need to be fairly active these days in how you use your plastic, to acquire the most out of it.

You need to stay ahead of the game. Understanding your personal credit card habit is important and it can help you save money. So exactly what kind of customer are you?

Why pay too much interest
Using some cards charging over 20% interest, balance transfer cards are a good way to move your credit card debt to a zero rate, usually for a specific period. With a lifetime balance transfer card you pay a lower interest rate up until you pay off the money you owe. You need to look out for expensive transfer fees at up to 3.2% of the balance amount, besides the 0% APR and the term of the deal in amount of months.

A few of the good deals at the occasion are Barclaycard’s Platinum Balance Transfer Card offers 0% for 24 months on balance transfers (17.9% standard APR on purchases) and Nat West’s Extended Balance Transfer Card with 0% for 24 months.

It’s good if:

  • You’ve developed debts plus a high balance
  • You’vetime and energy to check the small print
  • You’re able to keep to the terms with the 0% offer to get free from debt

Why don’t you use a card that gives you something back
With cashback credit cards you earn money on your account either monthly or annually, typically around 1% of your spending. The more you make payment , the much more you earn, sometimes subject to a maximum or minimum level you need to spend just before you qualify. They’re typically the fastest-growing type of card.

For example, Barclaycard’s Cashback Visa offers 24.8% with 6% cashback upon your five biggest monthly purchases in the first three months. After that the rate falls to 2%. The American Express Platinum Cashback Card offers 18.5% APR with 5% cashback for the first three months (up to a maximum of £125) prior to the rate falls to 1.25%.

For some cards you pay a yearly fee, usually £25, and they also may offer different rates for different types of spending for example Santander’s 123 cards and Asda’scashback card. With£25 fee, you need to spend a hefty £2,500 on the card in a year, simply to get the £25 cash back.

For several cards you pay an annual fee, usually £25, and they may offer different rates for various kinds of spending for an example Santander’s 123 card and Asda’scashback card. With a £25 fee, you have to spend a hefty £2,500 on the card annually, just to get the £25 money back.

It’s good if :

  • You make payment from your card monthly
  • You’re not searching for the best standard APR


Why want complications
Standard cards are definitely the most popular and so they vary only in the way the annual percentage rate (APR) is provided or calculated with no frills. Low-interest cards provide an introductory rate of interest of saying 4.9% APR within the first 6 months and 14.9% thereafter. Like balance transfer cards, most people choose low interest rate cards to minimize what they pay. But looking into the conditions and terms of the introductory rate to ensure that you won’t get hit with accumulated interest later.

Even though you don’t spend much on your own card, whenever you do, you’ll get protection with Section 75 of the Consumer Credit Act, that you simply don’t get along with your debit card.

One of the recommended buy standard rate cards currently would be the Capital One Rate card on 9.9% standard APR by having an interest-free duration of 56 days and Barclaycard’s Platinum Simplicity Card on 7.9%.

Its good if:

  • You’re a minimal card user
  • You’re tired of altering your card and checking the most recent deals
  • You desire a card that’s simple to understand


Remember, if you’re sick and tired of your credit card company hiking its rates, it is possible to switch it down and pay off the debt for the old rate. You won’t have the ability carry on using that card however you can switch and many people are up to this.

A number of people have a credit card to cover the emergency expenses and money withdrawals but be aware. Most cards charge £1.50 for each and every foreign transaction having a a lot higher APR on cash compared with purchases. Credit cards make the perfect tool for your hard earned money when utilized with a certain amount of care. However if you use a card to cover some major investing in your house or car, it might easily set you off on a rocky road of debt.

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