Can anyone advise me on Credit Cards?

[Russinating]

Also, I got my first credit card ~7 months ago with my bank. I now have an Amex Airmiles card which in 3 months has already got me a free return flight to Europe and 400 miles to spend on whatever I want. And I haven't paid a penny in interest in those 7 months.

 

[smr]

'I will not buy things I do not have the money for'.

At that age I would have rather lived by "I will not buy things I do not have the money for, because I can't" (not having a credit card)

Rather than "I will not buy things I do not have the money for - but then, hmmmmmmm..... there is my credit card" (having a credit card)

 

[Captain_Slick]

I'm 19 and have two credits cards worth a couple of grand or so. I pay them off in full every month because I know what my outgoings are and I don't use them to buy things I can't afford. The worst I've done is spread a purchase out over two months because I really really wanted it straight away, but I accounted for the interest which wasn't that much anyway.

 

[Nitrojan]

Fox, brilliant advice thanks! As for everyone that has provided me with advice in this thread.. thanks

 

[Russinating]

This is where the slippery slope begins.

'Oh I dont bother to save £x a month incase my car explodes, I'll just whack it on the credit card and splurge the cash I would have saved on random junk'

Simply follow the advice I gave, and you'll be fine. Deviate from the advice, and thats when you might come unstuck.

True, but life is always full of unforeseen circumstances no matter how safe you play it . I'd never pay for something I knew I couldn't afford to pay off within a month.

 

[[TW]Fox]

At that age I would have rather lived by "I will not buy things I do not have the money for, because I can't" (not having a credit card)

Rather than "I will not buy things I do not have the money for - but then, hmmmmmmm..... there is my credit card" (having a credit card)

Great, so you wish to be physically prevented from making the wrong decision rather than using your intelligence to avoid making the wrong decision. Thats fine if thats how you do things but don't push those flaws onto others. You came into this thread blaming credit cards for your own problems. Credit cards were not to blame for your debt - you were.

 

[Nitrojan]

So whats the difference between say.. An airmiles credit card and a 'Credit Builder' credit card? They're both going to build my CR so why not just go for the airmiles one?

 

[[TW]Fox]

So whats the difference between say.. An airmiles credit card and a 'Credit Builder' credit card? They're both going to build my CR so why not just go for the airmiles one?

I suspect Credit Builder is Capital One? It's just a name - it means nothing. IIRC the 'Credit Builder' product is a card with a crap limit, huge APR and ridiculously lax lending criteria that they'll hand out to anyone - I guess it's to hook in people who think they've got poor credit. They give them a stupid limit of 200 quid, they max it out anyway and dont pay it back and suddenly Capital One are raking it in - people who completely fail at money are the people credit card companies make money from.

ANY card will build your credit rating and provided you meet the lending criteria for the Airmiles card, if thats what you want, then there is zero reason to apply for the Credit Builder card instead.

The Airmiles card suggests you might be planning to travel. If this is the case I'd pick a card which offers zero fee foreign exchange on foreign purchases - you'll save a fortune over using travel agents etc etc to exchange money before going abroad.

The Halifax Clarity card for example charges 0% on foreign purchases and exchanges at the Visa Wholesale rate - guaranteed to be a better deal than you'd get at, say, Thomas Cook, or on any other credit card.

Read the terms and conditions carefully and make sure you know you've got a chance of getting the card before applying, as you dont want to fill your credit file with searches. Many cards require certain salary, for example - make sure you dont apply for these.

 

[Nitrojan]

I suspect Credit Builder is Capital One? It's just a name - it means nothing. IIRC the 'Credit Builder' product is a card with a crap limit, huge APR and ridiculously lax lending criteria that they'll hand out to anyone - I guess it's to hook in people who think they've got poor credit. They give them a stupid limit of 200 quid, they max it out anyway and dont pay it back and suddenly Capital One are raking it in - people who completely fail at money are the people credit card companies make money from.

ANY card will build your credit rating and provided you meet the lending criteria for the Airmiles card, if thats what you want, then there is zero reason to apply for the Credit Builder card instead.

The Airmiles card suggests you might be planning to travel. If this is the case I'd pick a card which offers zero fee foreign exchange on foreign purchases - you'll save a fortune over using travel agents etc etc to exchange money before going abroad.

The Halifax Clarity card for example charges 0% on foreign purchases and exchanges at the Visa Wholesale rate - guaranteed to be a better deal than you'd get at, say, Thomas Cook, or on any other credit card.

Yeah, Capital One. Well at the moment, the Airmiles credit card seems to be the only one with decent benefits.. a holiday.. What other typical benefits do lenders offer? Thanks for the advice again Fox! Really appreciated

 

[smr]

Great, so you wish to be physically prevented from making the wrong decision rather than using your intelligence to avoid making the wrong decision. Thats fine if thats how you do things but don't push those flaws onto others. You came into this thread blaming credit cards for your own problems. Credit cards were not to blame for your debt - you were.

As you're speaking of my experiences in the present-tense I can only gather that you have completely missed my point/angle.

The point is that at that age I didn't feel mature enough to have a credit card or mature enough generally to know enough about money. Eight years is a long time to grow up from being a teenager, into a man.

Maybe as I'm grown up now I should look into getting a Credit Card - but as all my posts in this thread have outlined - it's the point of age and money which has been my focus - not one thing without the other.

So it WAS a problem for me, now it would be a different matter.

I just don't want to see the OP get into trouble with it. It's just the mentality of many 18 year olds, which is a bit of a generalisation and no, not everyone is the same, some people mature quicker than others. But most people are stupid with money in their teens, and credit cards often do not help.

 

[mjt]

On the subject of frequent flyer miles (not Airmiles), get a credit card from the airline you're going to travel with most.

Having said that, unless you spend many thousands a year, it's just not worth it IMO.

 

[[TW]Fox]

Yeah, Capital One. Well at the moment, the Airmiles credit card seems to be the only one with decent benefits.. a holiday.. What other typical benefits do lenders offer? Thanks for the advice again Fox! Really appreciated

The main benefits you could benefit from at your age and salary would be:

a) Extended warranties/damage protection on electrical goods. Some cards offer this - Nationwide is one - you buy an electrical product and get an extension to the manufacturers warranty, and you get accidental damage protection for 90 days.

b) Zero fee foreign exchange - as explained above.

c) Cashback - though mostly it's 1% and has salary requirements and I doubt you will be spending enough to make this worthwhile

d) Links with loyalty card schemes - some give you Nectar points, etc.

I doubt you will spend enough money on the card to actually get a flight or holiday from the airmiles card. If you do plan a holiday you'll get more financial benefit from a card with zero charges for foreign transactions than you will with an airmiles one.

 

[[TW]Fox]

As you're speaking of my experiences in the present-tense I can only gather that you have completely missed my point/angle.

No, I've not.

The point is that at that age I didn't feel mature enough to have a credit card or mature enough generally to know enough about money.

Thats a shame, but please don't assume everyone was as underdeveloped as you were at 18. Many of us had credit cards at 18 - I did - with zero issues. The OP is asking all the right questions and is showing zero signs of being unable to cope with something as disasterously simple as a credit card.

I just don't want to see the OP get into trouble with it. It's just the mentality of many 18 year olds, which is a bit of a generalisation and no, not everyone is the same, some people mature quicker than others. But most people are stupid with money in their teens, and credit cards often do not help.

So that means nobody should get one and they are the spawn of satan?

Yea, right.

 

[Storm3y]

Fox, brilliant advice thanks! As for everyone that has provided me with advice in this thread.. thanks

I'd look into the terms and conditions of the cards you apply for. Some only accept people earning over £16k a year etc. Don't bother applying for those if you don't meet the criteria since the chances are you will get rejected and it's my understanding that too many credit checks and rejections over X ammount of time can damage your credit rating.

If you do decide to get one do some reasearch on the ones you are eligable for and have a word with your current bank and see what they can come up with.

 

[Nitrojan]

The main benefits you could benefit from at your age and salary would be:

a) Extended warranties/damage protection on electrical goods. Some cards offer this - Nationwide is one - you buy an electrical product and get an extension to the manufacturers warranty, and you get accidental damage protection for 90 days.

b) Zero fee foreign exchange - as explained above.

c) Cashback - though mostly it's 1% and has salary requirements and I doubt you will be spending enough to make this worthwhile

d) Links with loyalty card schemes - some give you Nectar points, etc.

I doubt you will spend enough money on the card to actually get a flight or holiday from the airmiles card.

I guess so.. Realistically I spent around £250-£300 a month at the moment as I am also saving up for a car and insurance and then once that's all done, I shall be putting money aside in an ISA/Premium bond. So I guess you're right.. No additional benefits for spending £300-£400 pm?

 

[DB_SamX]

Nothing to add; Fox has all bases covered...again.

 

[Deleted member 77746]

I had one when I was 18, still have one and use it aslong as I know I can pay it off every end of month. They are perfectly fine for people who can manage money.

If you feel you can't manage bills don't get one unless your willing to learn. After few months you get used to payment dates e.t.c so it's not so bad.

 

[utajoker]

totally depends on your mind set, if you think, ooh i can buy for free! do not get one.

 

[Nitrojan]

Totally confused now with which credit card to go for lol!

 

[Storm3y]

Totally confused now with which credit card to go for lol!

Look at the CC companys website for the critera or have a word with your bank to see if they can offer you any.