Be smart with your credit card: essential info!

By Jon Gutteridge

Credit cards are great for spreading the cost of purchases but before applying make sure you follow these golden rules.

Taking out a credit card isn’t always as simple as 1, 2, 3. There are things you need to think about before making the leap because at the end of the day, it is your credit history that can be effected should something go wrong.

Can you afford it?

It might sound obvious but making sure that you can always meet the minimum repayments each month is a must before taking out any credit, not just a credit card. Credit cards come with the temptation to spend because it’s there without realising that you actually have to pay it back – with interest. To understand what interest means for you, click here.

What are your current spending habits?

What do you plan on using the credit card for? Credit cards are great should you plan to put your weekly shopping on it with the intention of paying the balance off each month – in fact this is the ideal way to use your credit card as it builds a positive credit history. If you’re planning on putting a new Playstation 4 on it, or a few wild nights out then it’s really not advisable because not paying it off could lead to those nights being more expensive than planned. Credit card credit is only as good as its user, mistreat it and it has a bad effect on you.

Will you get the credit card?

Taking a few simple steps to check your ability to be accepted for a credit card could save you a lot of time. Doing a credit search on places such as Experian will show your credit score but will not give you a guarantee of being accepted. So try applying for cards that offer a soft credit check, this will give you a good idea of whether you are likely to be accepted without damaging your score if you’re rejected.  Ensuring you’re on the electoral register is also a good starting point. Knowing your credit history is also a good indicator as to what type of credit card might be available to you – if you have a bad credit history then you might want to search for credit cards that are aimed at rebuilding credit history. If you have a flawless credit history with a good reputation with your bank, for example, you might be eligible for a card with more perks and a better interest rate.

Always read the small print

Every credit card comes with small print, these little words of doom hold all those important terms and conditions that you might miss in the excitement of getting a credit card. Things such as APR, minimum repayments, annual fees, charges and introductory interest rates – you don’t always think to ask about these, look for them when applying or even take them into consideration. Always read exactly what you are signing up for and take them into account when comparing individual cards.

Always shop around

If you are certain that you want to take the credit card then make sure you shop around, there are many companies and services out there who want your custom so offer a great deal of perks to entice you in. Make sure what they are offering is right for you, don’t just go for something that you think looks good – 1/3rd off rail travel is no good if you don’t use the train. Using our comparison site will give you the right interest rates and terms – shop around.

Final thought

As with all credit, make sure you do your research and only apply if you know you can meet the repayments. Bad credit decisions can stay with you for a long time so think carefully and never just jump into any financial commitments.


Jon Gutteridge is an IT professional from Norwich who also runs The UK's Largest Community Website for earning money from home, The Money Shed. In his spare time he enjoys going to the gym and watching Leeds Rhinos or Norwich City play whenever he can.

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