Category Archives: Tips for Credit Cards

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Advice on getting your first credit card

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Credit cards are the king of convenience and there are many benefits to owning a credit card, like building up an essential credit rating or paying for something in an emergency such as a new washing machine. The best thing is they provide great financial insurance, so if the company that you bought your product off goes bust; the card issuer repays the amount, something impossible with a debit card.

Yet they can leave you in financial ruin if they aren’t respected and used wisely.
So to help guide you into the intimidating choice of credit cards here are a few useful tips to consider to make a credit card a beneficial asset.

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Pay it off monthly and pay it in full

If there’s only one thing you take away from these tips make sure it is this one. If you fail to adhere to this you will start to accumulate heft interest charges. Additionally there are also penalty fees for late and missed payments so be sure to pay your monthly fees and pay them in full.

Don’t have it on you all the time

It’s so easy to pay for things on credit card that it’s easy to forget how much you’re spending. If you know yourself to be a shop-a-holic then you should get into the habit of leaving it at home when casually shopping and instead use it for vital purchases such as repairs or travel tickets.

Pick the right card

With so many options out there picking the right credit card can be hard, especially your first one. Cards that charge 0% interest on purchases are ideal if you are looking to spread the cost of a purchase whereas cards that offer 0% on balance transfer are a better option if you have already built up a debt on another card.

If you are looking to stay with the same card long term then you may prefer a card that offers a low lifetime rate for both purchases and balance transfers. These are ideal for people who frequently travel as they incur a low charge to use abroad.

Optimize your finances

By maximising your income, reducing your spending and most importantly budgeting you can afford to make the necessary repayments you need to as well as live the lifestyle you want.

Having a stable job and decent income go hand in hand with owning a credit card, they are not an option for fast cash and should be avoided if you are already in debt as things can quickly spiral out of control.

If you know it’s going to be a tight month financially then consider cutting back on things you don’t need. Miss the gym that month or perhaps miss that show or two but don’t miss your repayments!

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Maximise Rewards on Your Credit Cards

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Credit card rewards are, at the very least, extremely nice to have. They can also give a genuine boost to your finances or be that factor that makes you choose one provider over another. But you don’t have to just passively accept the rewards as they come. With a little extra effort, you can maximise the rewards in order to draw the very greatest benefits from your card.

Combining With Separate Offers

Get a little extra reward in the first instance by looking at other offers and types of reward that you can combine with your card. For example, it may be possible to make your application through a cashback website. This will give you cash upon your application being accepted, above and separate from whatever rewards may come with the card. It is possible there may also be special offers for taking out a credit card with the bank you already hold a current or savings account with.

Making the Most of Cashback on Spending

Many cards offer rewards in the form of cashback on spending. Often, this reward is only valid for spending up to a certain value or for a certain time after you first take out the card. It is important, therefore, to make the most of this offer by spending the full value if at all possible, and doing so while the cashback offer is still in effect. If you have any big purchases coming up like car insurance renewal and you were planning to pay cash for them, it can instead be worth putting them on your card in order to get cashback. You can then quickly repay the balance with the cash you were going to use for the purchase, and therefore avoid interest.

Gift Vouchers and Material Gifts

If you are given a gift voucher for a shop you do not normally use, then it might be possible to get more benefit out of it than you would from simply going to the shop specifically to use the voucher. It might be possible to turn the voucher into cash that you can spend wherever you like by selling it to somebody who does shop their regularly. Ideally, you will be able to make a deal with a friend or family member to exchange it for its cash value directly. They lose nothing because they shop there anyway, and you gain flexibility in your spending. However, it may even be worth selling it for slightly less than the credit is worth. For example, if a card comes with a £100 M&S gift voucher and you do not normally shop there, it is likely you could do more with £90 or £95 in cash at your normal shopping destinations than you could with the voucher, and you may well find somebody willing to pay this much. There are also companies that buy your vouchers, but they tend to pay disappointing rates.

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Credit Card Applications – 4 Tips You Need to Know!

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In this day and age, it’s extremely easy to apply for credit. Whether it be a payday loan, personal loan, or credit card, you have many options available.

When it comes to credit card applications the whole process seems rather simple. However, this is not always the case, as there are many mistakes which people make that results in their application getting declined.

If you want to avoid these mistakes, then you should follow the 4 tips outlined below, as it could mean the difference between success and failure.

Fill out the whole application form

While this may seem obvious, a common reason credit card companies reject applicants is because of incomplete application forms.

One of the main reasons for this could be the fact that many people are now filling out their applications online, which means it’s all too easy to miss out a page.

Before you send off your application for review, make sure you check over everything at least once, so you are 100% sure everything was filled in.

Give accurate information

Another reason why your credit card application might be turned down is because of inaccurate information. Let’s face it, we live in stressful times, and it’s all too easy to make simple mistakes when filling out a form.

For example, you might put down a wrong phone number, or get the number of a past address incorrect. For this reason, you should always double check the information you have supplied before clicking send or putting in the post.

Read the terms and conditions

Did you know that when you send your credit card application, you have already agreed to the terms and conditions set out by the lender.

With this in mind, you should have a good understanding of the terms and conditions BEFORE you fill in the application. If there is something that you do not agree with, then you should refrain from proceeding any further.

Ask questions

If there is anything that you are unsure of then don’t be afraid to ask questions. All credit card companies are easily reached by phone, which means you can get an answer to your question within a few minutes.

Talking to the support staff will also give you a better idea on what it is like to deal with that credit card company, and if they are rude then it is probably a good idea to end your dealings with them right there.

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Mis-sold PPI on your Credit Card?

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If you are currently holding a mortgage, car loan, or credit card under your name, there is great chance that you have been mis-sold Payment Protection Insurance.

It was only until recently that the terms and conditions of selling PPI policy’s changed. Originally, PPI was sold at the same time borrowers take out a loan. The function of PPI has always been to protect customers by covering monthly payments in the event that a borrower falls ill or is rendered as unable to work due to injury, disability, or loss of employment.

Unfortunately, most PPI policies did not live up to its guarantee of keeping loan payments current during times of dire need. Personnel from lending institutions failed in explaining the capacity, functions, and full extent of PPI, including the exclusions or exceptions which may render a borrower unfit to get its benefits. For instance, freelance or those who tagged themselves as self-employed or borrowers who suffer from preexisting medical conditions are denied PPI benefits, which in turn resulted in mortgage, car loans, and credit cards defaults not being covered they way they should have been. Obviously, the policies were sold to certain groups of borrowers who were ineligible for cover in the first place.

If you belong to any of these groups, or have noticed some vague terms and conditions under your contract agreement, you are most likely a victim of mis-sold PPI.

Re-check your agreement with a lender. Assess the terms and conditions and if the following words appear in your contract, there is a big chance you have been mis-sold PPI:

–          ASU

–          Loan care

–          Loan protections

–          Payment cover

–          Protection plan

You may or may not find these words on your agreement, but if you think it is likely to be a case of mis-sold PPI verify this by seeking the help of a claims management company such as PPI Claims Advice Line. You will receive the information and help you need in order to get the compensation you deserve for the mis-selling by the banks. Further information on claiming back PPI on credit cards can be found on here.

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Tips to avoid unrewarding credit cards

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Reward credit cards are usually offered to customers with excellent credit histories. The idea behind reward credit cards is to encourage you, as a customer, to spend. This may be spending in general on your credit card, or spending your money with particular business partners your credit provider has a relationship with. Rewards can take the form of cash, gift cards, air miles or even hotel stays.  Reward schemes can be an important factor when choosing one card over another. Savvy consumers, can take advantage of such reward schemes and enjoy the benefits.

Reward credit cards tend to be associated with higher annual percentage interest rates and higher fees. Before choosing a reward credit card, consider: will the value of the rewards outweigh the extra costs associated with such a card? In some cases, it may be better decision to have a standard credit card with overall lower fees and rates of interest.

Cash back rewards are by far the simplest. It is pretty straight forward. You receive cash for spending a certain proportion on your credit card. Although cash back may not deduct the balance on your account, it’s still money! You can use it on whatever you like.

It is always important to weigh up the cost and benefit of reward credit card schemes. Some may not be as rewarding as they first seem. Use the following tips to avoid unrewarding credit cards:

  • Be wary of limited rewards.  A good reward credit card is one that increases reward as you increase the amount of money you spend. A limit on how many rewards you can incur is clearly not to your advantage. This is a restriction to stay clear off.
  • Be aware of when your reward will expire. Will you have a reasonable amount of time to use your reward before it expires?
  • How easy is it to redeem your reward? For example, if it is a free hotel stay, how accessible and affordable is it to get to the hotel destination?
  • How much money you are required to spend before you can start earning rewards?
  • Don’t spend on things you usually wouldn’t to chase rewards! This can lead to unmanageable debt.