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Don't be taken for a ride by your credit card, make
that piece of plastic your most flexible of friends.
Here's a guide to the top deals currently on offer
to you. |
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It's difficult to open a magazine or click on a
website without seeing an advert for a credit card.
They all claim to offer the best interest rates,
the best reward schemes and the grooviest graphics
on their plastic.
But how do you find really
good value and which do you choose from the thousand
or so on offer? The choice ranges from the familiar
Barclaycard through to design-conscious cards from
internet banks, such as Smile, Cahoot and Egg. There
are pushy newcomers from the United States, such
as Capital One and MBNA - and every organisation
from a charity to a football club now has
to have its own credit card.
There are 90 million cards in circulation (heading
towards two cards per head of population) and last
year we spent a spectacular £70 billion on cards,
the highest-ever figure.
So what should we look for in a
credit card? First, perhaps
you should decide if you're the type of person who'll
pay off everything they owe on their card every
month. If you're not (and let's be honest, how many
of us are that self-controlled?) then you should
look for a card with a low
interest rate.
Don't be put off if the names
sound unfamiliar, and don't pay too much attention
to whether they're dressed up as gold, platinum
or any other colour of card – they all going
to carry the Visa or Mastercard badge and they all
going to carry out the same function of lending
you money in exchange for interest.
If you can settle up your credit card bill each
month, then interest rates are not the issue. Instead,
apart from wearing a halo, you should be looking
for the longest possible stretch of interest-free
credit. At the moment, you can get 56 interest-free
days on credit cards from Tesco, First Direct, Halifax,
HSBC and NatWest.
You might also be lured by offers of reward schemes
– such as cashbacks, airmiles or discounts
in shops. But don't be too swayed, because spending
wads of cash on a credit card could be a very expensive
way to make a few gimmicky savings.
Even though credit cards can get a bad press for
tempting people into debt, they are useful and they
can be cheap – and I bet you don't really pay
off the whole bill every month.
—Sean Coughlan 12.9.00 |
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