Just got my first ever Credit card

[rosscobmw]

So I'm new to all this credity stuff. I'm 23, a homeowner and have never had a credit card/loan/overdraft before. I've always just saved and bought what i can afford but with owning my house for 6 months I've realised this isn't as easy with a mortgage and bills. It's a 27.5% one, i want to just use it to get my credit rating up really. I dont want to go and buy a fancy TV or anything.
So whats best for doing it? Buying the shopping on the credit card and paying it back that month? Or putting my fuel on it? Really have no idea but would like to do something so in future if i really need to i can get a big loan or whatever.

Cheers,

[MagicalTrevor]

If you're disciplined then using it to pay for everything and then paying off the balance in full is the sensible way of doing it.

Alternatively, occasionally buy things and then pay them back over a couple of months (even though it acrues interest) will build up your credit rating as the lender sees you managing credit over a few months. Maybe do this on something that costs £100 so the interest you pay isn't massive.

I'm not an expert, this is something that I did to improve my credit rating (999 rating on Credit Expert now)

[Ean218]

rosscobmw said:

So I'm new to all this credity stuff. I'm 23, a homeowner and have never had a credit card/loan/overdraft before.

Did you know that a mortgage is just a very, very big loan?

[rosscobmw]

Ean218 said:

Did you know that a mortgage is just a very, very big loan?

I am quite aware, yes.

[Lawrence5]

You only benefit once from sticking petrol/shopping on a CC unless you have a reward card.

Be careful – they are a lot more useful with available credit when you need funds that aren’t predictable e.g. car repairs

Or use it to chop up the coke and oil the strippers..... its the PH way

[JonRB]

My advice would be to only spend what you have. View it as a debit card that you pay for at the end of the month rather than as you go. Just be very careful not to spend more than you have.

Also, Martin Lewis of MoneySavingExpert always says to substitute the word 'debt' instead of 'credit' to help focus your mind.
This gives such gems as "Debt card", "Easy debt terms", "Debt agreement", "Available debt" and "In-store debt"

[TwigtheWonderkid]

If you can afford to clear it off each month you don't need it, if you can't then you don't want it.

[blank]

The way to do it is:

Get card with cash back / reward points.
Set up direct debit to pay full bill every month just after pay day.
Use it for as many purchases as possible.
Make sure you don't spend more than you normally would as it seems like 'free' spending.

[Mobile Chicane]

rosscobmw said:

So I'm new to all this credity stuff. I'm 23, a homeowner and have never had a credit card/loan/overdraft before. I've always just saved and bought what i can afford but with owning my house for 6 months I've realised this isn't as easy with a mortgage and bills. It's a 27.5% one, i want to just use it to get my credit rating up really. I dont want to go and buy a fancy TV or anything.
So whats best for doing it? Buying the shopping on the credit card and paying it back that month? Or putting my fuel on it? Really have no idea but would like to do something so in future if i really need to i can get a big loan or whatever.

Cheers,

Whoah, whoah.

The last thing you want to be doing is racking up credit card bills because you can't live within your means.

Of course homeowning is an expensive business if you have to buy everything from scratch. Beg and borrow furniture and housewares from family and friends until you can afford to buy. (SWMBO of course may have other ideas - do not fall for these.)

Getting into credit card debt is one of the worst things you can do. Interest rates are extortionate. I thought First Direct were taking the piss at 19.9% a month, but 27.5%?

[JonRB]

Mobile Chicane said:

Whoah, whoah.

The last thing you want to be doing is racking up credit card bills because you can't live within your means.

Well spotted! I missed that bit.

I agree - Credit Cards are NOT a way of getting "free" money because you can't meet your outgoings.

[ticmon]

rosscobmw said:

i want to just use it to get my credit rating up really.

Why the need to boost you credit rating?

If you have a mortgage you've probably got a very good rating as it is?

Many people use a credit card to get their credit rating up in order to then apply for a mortgage.

[Jon999]

Mobile Chicane said:

rosscobmw said:

So I'm new to all this credity stuff. I'm 23, a homeowner and have never had a credit card/loan/overdraft before. I've always just saved and bought what i can afford but with owning my house for 6 months I've realised this isn't as easy with a mortgage and bills. It's a 27.5% one, i want to just use it to get my credit rating up really. I dont want to go and buy a fancy TV or anything.
So whats best for doing it? Buying the shopping on the credit card and paying it back that month? Or putting my fuel on it? Really have no idea but would like to do something so in future if i really need to i can get a big loan or whatever.

Cheers,

Whoah, whoah.

The last thing you want to be doing is racking up credit card bills because you can't live within your means.

Of course homeowning is an expensive business if you have to buy everything from scratch. Beg and borrow furniture and housewares from family and friends until you can afford to buy. (SWMBO of course may have other ideas - do not fall for these.)

Getting into credit card debt is one of the worst things you can do. Interest rates are extortionate. I thought First Direct were taking the piss at 19.9% a month, but 27.5%?

Listen to all of this ^

[rehab71]

blank said:

The way to do it is:

Get card with cash back / reward points.
Set up direct debit to pay full bill every month just after pay day.
Use it for as many purchases as possible.
Make sure you don't spend more than you normally would as it seems like 'free' spending.

This.

I have the Lloyds Avios Duo. You get 2 card with it, a MasterCard and a Amex. I buy everything on them and clear it every month. I get 1 point for every pound spent on the Amex and 1 point for every five pounds I spend with the MasterCard.

Why use the debit card and get nothing out of it? Plus the additional protection of using the CC.

[Terminator X]

The OP is fked! My mother said almost the same to me when I got my first one and by jingo she was right

TX.

[cuprabob]

Mobile Chicane said:

I thought First Direct were taking the piss at 19.9% a month, but 27.5%?

That's the APR so it's 27.5% per annum or 2.29% per month but as you say pretty high

[rehab71]

swerni said:

rehab71 said:

blank said:

The way to do it is:

Get card with cash back / reward points.
Set up direct debit to pay full bill every month just after pay day.
Use it for as many purchases as possible.
Make sure you don't spend more than you normally would as it seems like 'free' spending.

This.

I have the Lloyds Avios Duo. You get 2 card with it, a MasterCard and a Amex. I buy everything on them and clear it every month. I get 1 point for every pound spent on the Amex and 1 point for every five pounds I spend with the MasterCard.

Why use the debit card and get nothing out of it? Plus the additional protection of using the CC.

This is what I do.
Use them as charge card, that way you get pavement protection and the rewards.
4 months into the year and I've already got my BA companion ticket and all the air miles, I now going to swop to the virgin card and do the same.
All the while I'm paying no interest.

I've always had a charge card, but with Amex taking the piss with fees, I've now switched to credit cards and use cash as little as possible.

Must admit, the air miles were at the back of my mind when I recently bought a round shiney thing for my better half

[megapixels83]

My Amex / MasterCard duo credit card offers avios points and if I spend £15,000 a year a companion ticket on any BA flight I book. I use me credit card for everything and pay it off every payday without fail. Works perfectly, never had an interest charge, collect enough airmiles for 3 return trips to Europe each year and a free ticket for any flight I book with ba. I am very disciplined though

[rosscobmw]

Jon999 said:

Mobile Chicane said:

rosscobmw said:

So I'm new to all this credity stuff. I'm 23, a homeowner and have never had a credit card/loan/overdraft before. I've always just saved and bought what i can afford but with owning my house for 6 months I've realised this isn't as easy with a mortgage and bills. It's a 27.5% one, i want to just use it to get my credit rating up really. I dont want to go and buy a fancy TV or anything.
So whats best for doing it? Buying the shopping on the credit card and paying it back that month? Or putting my fuel on it? Really have no idea but would like to do something so in future if i really need to i can get a big loan or whatever.

Cheers,

Whoah, whoah.

The last thing you want to be doing is racking up credit card bills because you can't live within your means.

Of course homeowning is an expensive business if you have to buy everything from scratch. Beg and borrow furniture and housewares from family and friends until you can afford to buy. (SWMBO of course may have other ideas - do not fall for these.)

Getting into credit card debt is one of the worst things you can do. Interest rates are extortionate. I thought First Direct were taking the piss at 19.9% a month, but 27.5%?

Listen to all of this ^

I can afford to live within my means just fine, All of the furniture etc i bought for the house was cheap from facebay and friends etc. What i meant was I struggle to save as much as i used to so my savings are somewhat lower than they used to be. Was thinking about using the credit card to up my credit rating (yes i have a mortgage but my credit rating still isn't great, the mortgage is joint), so using it for fuel etc and paying it off each month and also have it there for emergencies eg: boiler breaking down etc. I've never been one to go buy things i can't afford, never tried to live a life i cant afford.

[eggchaser1987]

OP in the same thinking as you. I have just got my first house (about 7 months ago) and also a credit card, same reasoning as yourself.

I tend to use it for fuel and car repairs (tyres etc) only reason for this is because I know I get it back the middle of the next month from work so can definitely pay it all in one go.

Otherwise think it would be used for the food shop then again pay it back and the odd repair to be payed back over a few months if expensive.

[Tino]

MagicalTrevor said:

If you're disciplined then using it to pay for everything and then paying off the balance in full is the sensible way of doing it.

Alternatively, occasionally buy things and then pay them back over a couple of months (even though it acrues interest) will build up your credit rating as the lender sees you managing credit over a few months. Maybe do this on something that costs £100 so the interest you pay isn't massive.

I'm not an expert, this is something that I did to improve my credit rating (999 rating on Credit Expert now)

I've got the same rating, but have never carried a CC Debt over, so have never paid interest on a CC.
Get the one that gives you the best reward(amazon points or cashback) and set up a DD to pay it off just before the due date.
Keep the money that you will use to pay in a high interest account(5% Nationwide up to £2500) and discipline yourself to only use the card for what you need.
If you do need further long term credit, sign up for a long 0% balance transfer card and use that as your overdraft, making sure that you are confident that the balance will be there when the introductory period runs out.
Be careful, and if you start to sink, consider renting out a room, getting an extra job etc.