18th soon... Need some advice regarding credit...
Discussion
Hey guys, Just a quickie.
As per the title really, I'm coming up to my 18th in the few days and wanted some advice as to what I should be regarding credit?
Before you get worried, I don't intend on going on a spending spree
.
I'm more interested in the rumor that if you don't take out Credit, your 'score' won't improve and as a result, you won't be desirable to get any when you really need it? I read a few years ago that the best bet was to apply for a Credit card, buy a pair of socks with it and then cut up the card, never to use it again. I pay the bill, it shows that I'm not an idiot when it comes to credit, my rating goes up. Is there any truth to this?
If so, is there any chance a Credit card company would take me on in the current climate? I have a full time job and all that jazz, but I would have thought that I'd be a mighty big risk?
If this 'buy socks' plan is useless, is there anything else I should do particularly, or is it something that I won't have to worry about for a while?
Any Thoughts welcome
Thanks
Josh
As per the title really, I'm coming up to my 18th in the few days and wanted some advice as to what I should be regarding credit?
Before you get worried, I don't intend on going on a spending spree
. I'm more interested in the rumor that if you don't take out Credit, your 'score' won't improve and as a result, you won't be desirable to get any when you really need it? I read a few years ago that the best bet was to apply for a Credit card, buy a pair of socks with it and then cut up the card, never to use it again. I pay the bill, it shows that I'm not an idiot when it comes to credit, my rating goes up. Is there any truth to this?
If so, is there any chance a Credit card company would take me on in the current climate? I have a full time job and all that jazz, but I would have thought that I'd be a mighty big risk?
If this 'buy socks' plan is useless, is there anything else I should do particularly, or is it something that I won't have to worry about for a while?
Any Thoughts welcome
Thanks
Josh
Get a credit card with good cashback (shouldn't be too hard - it won't have a high limit though).
Set up a direct debit from your current account for the full monthly balance.
Use credit card for things like petrol and shopping.
Make sure you don't go mad with it, and don't spend money you don't have thinking you will in a month's time.
Set up a direct debit from your current account for the full monthly balance.
Use credit card for things like petrol and shopping.
Make sure you don't go mad with it, and don't spend money you don't have thinking you will in a month's time.
blank said:
Get a credit card with good cashback (shouldn't be too hard - it won't have a high limit though).
Set up a direct debit from your current account for the full monthly balance.
Use credit card for things like petrol and shopping.
Make sure you don't go mad with it, and don't spend money you don't have thinking you will in a month's time.
+1. If you think you've got the self control, get one and use it like a debit card - day to day small purchases, only spending money you KNOW you have in your bank account, ready to transfer over before you start paying interest. Set up a direct debit from your current account for the full monthly balance.
Use credit card for things like petrol and shopping.
Make sure you don't go mad with it, and don't spend money you don't have thinking you will in a month's time.
hole - only spend what you have and pay it off in full every month.blank said:
Get a credit card with good cashback (shouldn't be too hard - it won't have a high limit though).
Set up a direct debit from your current account for the full monthly balance.
Use credit card for things like petrol and shopping.
Make sure you don't go mad with it, and don't spend money you don't have thinking you will in a month's time.
Very thought about using a Credit card "properly" before, but I guess it could make sense. I never carry cash, and am buy no means a bit big spender: £50 - £100 on fuel a month, £50 - £70 on personal food shopping and I'm pretty much done, so maybe sticking small stuff like that on a CC would be a good idea?Set up a direct debit from your current account for the full monthly balance.
Use credit card for things like petrol and shopping.
Make sure you don't go mad with it, and don't spend money you don't have thinking you will in a month's time.
Will this be a massive help to my credit (you know, enough to actually bother)?
And will the mistakes of my parents have a major affect of me getting credit myself? My mother was declared bankrupt a few years ago, and feared back then that banks/CC Companies wouldn't look too favorably upon me?
I have read various suggestions about what spending patterns are "best" to look good on credit reports, but certainly having one card and paying it off every month is better than not having one at all. As mentioned, don't ever spend more on it than you are certain you can pay off in full, lest you get into the trap of keeping a balance on it.
There are easier / safer ways to get yourself a credit record. Make sure you're on the voters roll for one! A contract mobile, which is cheeper than a PAYG. Ask your bank for a small overdraft. Underwritters rarely look at what type of entries you have, just how you manage them.
P.S. I had some underwritting responsiblities in a finance company for 8 years.
P.S. I had some underwritting responsiblities in a finance company for 8 years.
Aaah - modern youth.
Once upon a time you knew you had "become a man" if you had -
killed your first antelope
walked back to camp after being left for seven days in the wilderness
drunk your first pint
smoked your first ciggie
slept with your first girl
been given the key of the door
Now it's when you become eligible for your first credit card.
(PS - I still haven't ticked off all the things in that list - but I'm not saying which ones).
Once upon a time you knew you had "become a man" if you had -
killed your first antelope
walked back to camp after being left for seven days in the wilderness
drunk your first pint
smoked your first ciggie
slept with your first girl
been given the key of the door
Now it's when you become eligible for your first credit card.
(PS - I still haven't ticked off all the things in that list - but I'm not saying which ones).
Eric Mc said:
Aaah - modern youth.
Once upon a time you knew you had "become a man" if you had -
killed your first antelope
walked back to camp after being left for seven days in the wilderness
drunk your first pint
smoked your first ciggie
slept with your first girl
been given the key of the door
Now it's when you become eligible for your first credit card.
(PS - I still haven't ticked off all the things in that list - but I'm not saying which ones).
It's obvious isn't it? Once upon a time you knew you had "become a man" if you had -
killed your first antelope
walked back to camp after being left for seven days in the wilderness
drunk your first pint
smoked your first ciggie
slept with your first girl
been given the key of the door
Now it's when you become eligible for your first credit card.
(PS - I still haven't ticked off all the things in that list - but I'm not saying which ones).
Eric Mc said:
Aaah - modern youth.
Once upon a time you knew you had "become a man" if you had -
killed your first antelope
walked back to camp after being left for seven days in the wilderness
drunk your first pint
smoked your first ciggie
slept with your first girl
been given the key of the door
Now it's when you become eligible for your first credit card.
(PS - I still haven't ticked off all the things in that list - but I'm not saying which ones).
To be honest, I'm Not too fussed about being able to get credit, I just want to make my life easier in the future when I really need it (I.E, mortgage). I know. I'm dull.Once upon a time you knew you had "become a man" if you had -
killed your first antelope
walked back to camp after being left for seven days in the wilderness
drunk your first pint
smoked your first ciggie
slept with your first girl
been given the key of the door
Now it's when you become eligible for your first credit card.
(PS - I still haven't ticked off all the things in that list - but I'm not saying which ones).
Simps said:
blank said:
And will the mistakes of my parents have a major affect of me getting credit myself? My mother was declared bankrupt a few years ago, and feared back then that banks/CC Companies wouldn't look too favorably upon me?
Worth getting a copy of your credit report to find out if that has affected you. I had to get a "disassociation" from my Dad's credit report before I could get my first credit card - some of his missed payments appeared on my file because I was still using his address. P-Jay said:
Gareth79 said:
P-Jay said:
A contract mobile, which is cheeper than a PAYG.
Ummmm, I put about ten quid on my phone every six months at most 
Too true...
Well, I'm now in a similar situation, having moved to the US. It seems like people are more focussed on credit scoring than in the UK. I have a good solid score and history in the UK, Have a 2 year history of slightly overpaying a hefty studies loan, and monthly clearing of my UK credit card, plus the old tricks of moving cash around, seemingly creating the illusion of more cash going to you.. During the 'credit crunch', my card has gone from having a £1500 limit, to a £6500 one. Ridiculous, I know.
Sadly, in the US, my UK history seems to count for squat, so, I now have the kind of credit card Bernie Madoff will be eligable for. It has a small balance secured on cash (which is witheld). Once a payment history for a few months has been established, I'll have established a credit history in the UK, and will hopefully be treated like an adult...
Agree with all the good advice on here. Cards are great if used responsibly, for the reason the OP asked. Use it for all necessities in your typical budget, and pay it off in full each month. You'll be fine.
Any other form of contractual lending/payment works, too. Contract phones, car leases, etc.
My next plan, although it will cost me a bit (but thereafter, we're looking to buy a house), is to get a small loan of a few grand, one without an early repayment penalty. Then just use the loan cash to pay it back with hefty overpayments. Just to shore up my credit score. That's all these new worlders talk about..
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