Should I get a credit card?

#62

Use an Amex.

Instant notifications and rewards for spending what you’d spend anyway!

Just pay it off every day/week/month and you are literally getting something for nothing :smiley:

Edit - Of course I’m joking with you now - You need to do what’s best for you, no matter what anyone else says.

(Jordan) #63

I would say if you want to get one do - I did to improve my credit rating (as some things as mentioned in the thread above don’t apply to me) - although I’m still not really sure on how your rating changes - I think that could be a new blog feature from Monzo explaining this in a bit of detail from the Banks point of view.

But in all honesty I only use it for “big purchases” at the end of the month or my petrol and usually move the money straight back - I’m a little too unorganised for the 0% game and will probably pay off what I have on it atm in 2 months and then not use it again (or only in “emergencies”).

I got my CC with the Legacy I was still banking with at the time as it was probably the best one I could’ve got having just graduated.

But to each his/her own - if it works for you then it works!

#64

Wow that is impressive, with what credit card

#65

It’s with one of the Amex cards that offer a 2-4-1 BA ticket.

The unusual thing here is the actual ticket initially costing £15K - Ultimately, you’d end up using the same number of points if the ticket only cost £3K (assuming the flight was to Mumbai).

So I guess if you want to feel like you are getting the absolute most for your points, you want to find a flight that is overpriced, and then use your points on it.

Prime example was my flights to Lanzarote last year (family of 4).

I could have probably got them for around £700 or £800 depending on what “extras” I went for (maybe slightly more).

The BA flight I ended up booking would have cost £1850 if I’d simply booked through BA (It actually cost me £115 in taxes, because I booked with my BA points).

So, did I save £1850 (minus the £115)? In a way, yeah I did.

Would I have spent £1850 on flights to a volcanic rock… No - If I had to, I’d have bought the £700/£800 flights from a budget airline.

(Lewis King) #66

The reason the Mumbai flights were so much was that they were fully flexible, something that booking a redemption flight offers, but buying the cheapest fairs often doesn’t. Anyway… more recently I’ve booked to go to Split in June, cost me £42.50ish, (business out, economy back) - would have been about £400 buying a ticket direct. I still think that’s a good use of just under 20k points (now that I’m single, finding shorthaul redemptions with their capped taxes way more appealing!)

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#67

Did you go onto the flight availability calculator and see what was available?

I did… We are going to Split in August! :joy:

Cost £150 for a family of 4 (economy both ways, I don’t think it had business as an option!)

(Lewis King) #68

Yep! Bit gutted I didn’t get business on the return, but I’ve got an alert going if they add more :slight_smile:

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#70

I currently have two credit cards, a BA Amex card, no interest free period, used for ‘everyday’ purchases from online retailers (lots now who accept Amex) and for booking flights. Builds up my Avios points which is what I’m interested in. Statement paid off every month, so no interest repayments = no debt. The Amex mobile App is superb by the way!

Second card, Virgin Money 28 month interest free period. Used solely and primarily for funding expensive purchases that I have no wish to dip into my current account for. So the only time I’ve used the card thus far, was to fund a very expensive holiday. I will pay the card off within the 28 months interest free period thereby effectively having had an interest free loan. As it stands, I only have 3 payments left to make on my so far first and only purchase and then I’ll still have 18 months remaining on the interest free period to fund another purchase if I wish. The key point here is, no spending on the card until the current purchase is settled! At the end of the 28 month interest free period, I’ll ditch the card as there will be no point in retaining it. I did this with my last interest free card. In fact, I didn’t even have to take any action to cancel the card myself, I just didn’t use the card for 2 years and the bank cancelled it themselves because they sent me two letters advising that if I didn’t use it within a certain period of time, they would automatically cancel it for fraud prevention purposes. I ignored the letters and the card was cancelled (I know this because it is indicated as such on my credit report as ‘settled’.) This didn’t in any way impact my credit score as I successfully applied for other credit cards after that. Indeed, my credit score is pretty good to be honest.

So my point is, credit cards, i.e. the right credit card, can be a super savvy way to purchase IF you are financially disciplined enough to make more than the minimum repayment at each and every statement. Clearly, there are people out there who probably should never ever be allowed anywhere near a credit card because they are unable to grasp the concept of spending control, the personal responsibility bit. Ultimately, the aim should be to never pay a penny in credit card interest and I have never paid a penny in interest. Sadly though, interest payments a daily fact of life for many credit card holders and ultimately, this is what makes the credit card providers money. Undoubtedly it also allows people like me to keep utilising interest free periods, effectively allowing me to make use of interest free loans for as long as there are credit card providers out there who carry on promoting these types of credit card.

Basically, if you are financially savvy and can exercise enough financial self discipline to pay off whichever card you have sucessfully applied for, then credit cards are excellent for the additional financial protection they provide and of course the interest free period that some use as the ‘hook’ to draw you in. They are also often required for things like car hire, so having one can be a must for someone such as myself who travels frequently.

So in summary, I only ever usually apply for the interest free period cards, the Amex card being the exception because of the Avios points earned on purchases. I would also personally not hold any more than 2 credit cards, I stress that is a personal choice, not a recommendation. I would also consider asking the credit card company to cap the credit card limit for purchases if they start increasing the limit. They shouldn’t acually do this unless they contact you first.

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(Runchen Sun) #71

I really think you do. But before that, let me share some story from me.

My first credit card was on my first year undergraduate. It’s only approximate 200 pounds (in China) and I have used all the credit for every single months. Then I got more credit, from that on, in the two years period I was on debt. I owe the bank about 2000 pounds while I got only 200 pounds per month for allowance. That’s where I start to have part-time job and work hard.

Now I got fully control of my appetite.

My point is, people will tell you credit card is bad cause you can’t control yourself. That’s true. But if that’s the process you have to get though, the sooner the better.