307 mini mag

good to know
Why it pays to have a
credit card
Make sure you get the most from your money every time you spend
By Sarah Pennells
When used sensibly, credit cards can be a shopper’s best friend,
as you get useful legal protection if there’s a problem and the
shop won’t help, and they’re a better option than a debit card if
you’re worried about fraud. But which card should you choose?
Cashback
and reward
credit cards
0% interest
on purchases
cards
Cards for
travel fans
to use abroad
Cards to help
build your
credit record
Balance
transfer
cards
Cashback and reward
credit cards give
you money or points
every time you
shop with your card.
The reward points
may be linked to a
supermarket, or give
you travel miles.
M&S Bank’s Reward
Plus card gives you
one point for every
£1 you spend at M&S
and one point for
every £5 you spend
everywhere else. All
M&S credit cards give
you preferential rates
on travel money you
buy at M&S using
your card.
If you’d
prefer cashback,
the American
Express Platinum
credit card gives
you 5% cashback
for the first three
months, then
1%. But beware,
some shops
don’t take
Amex cards.
You can get interest-free
shopping for two years
or more if you pick the
right card. Post Office
Money’s Platinum card
charges 0% interest
on purchases for 28
months, but you have to
apply for it online.
If you don’t want
to apply online,
Sainsbury’s Bank has a
similar card (also 0% for
28 months) – and there’s
a bonus of earning
Nectar points on
your spending.
Regular credit cards
charge a fee every time
you use them abroad
– typically up to 3%.
You’ll also get charged
for taking cash out
on holiday.
But some cards
– like the Halifax Clarity
credit card – don’t.
There are no fees if
you use it for spending
abroad and no fee to
take cash out – but you
will pay interest.
If you have a bad, or no,
credit history, a credit
builder card may be
useful. It charges a much
higher interest rate and
the credit limit is set low.
You must pay it off in full
each month to improve
your credit rating.
Barclaycard Initial
credit card charges
interest at about 34.9%
APR, but that should
be reduced after
12 months’ payments
on time.
Balance transfer cards
let you move unpaid
balances from your
credit card(s) to one
that charges 0%
interest. You normally
have to pay a balance
transfer fee of between
1% and 3%. Make
sure you pay off the
balance before the 0%
deal runs out.
Tesco Bank’s
Clubcard balance
transfer card charges
0% interest for 32
months, with a fee
of just 0.99% on
balances you
transfer in the
first 90 days.
n All information
correct at the
time of going
to print
pics: alamy stock photo
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