If used correctly, credit cards can be an asset to your finances and offer a cheap way of making purchases if you need 6 weeks or so before you pay your card in full. You could for instance, pick up a bargain in a sale safe in the knowledge that you have a few weeks to come up with the money.
This means you are likely to avoid interest charges. Taking advantage of 0% balance transfers helps keep costs down as long as you don't run out of time and are left with a huge outstanding balance and no money to pay for it! The cards from the VISA International or Mastercard networks are available from banks and other financial institutions. Most people who are successful when applying for a card will need to be in full time employment and have a regular income.
The Gold card is a more expensive version of credit cars with added options that include travel insurance and free currency exchange. As with Platinum cards, you would be expected to have a higher annual income and pay higher charges. American Express and Diners Club, are charge cards and you would be expected to pay off the outstanding bill each month. Another plus point to having a credit card is that you can use your card to withdraw cash from a cash point using your pin number,however, you will pay interest on your card as soon as you have withdrawn the cash.
How much do cards cost?
There are two types of charges involved, an annual charge and a monthly interest charge on an outstanding balance. The charge cards operate an annual fee only and this can be from around £40 to £90. Not every card imposes an annual fee and you could find that if they do, they will waive the charge if you are a frequent user. Interest rates vary on cards normally quoted per month, and with an APR that will enable you to compare the cost of borrowing on different cards. Interest is not charged if you pay the whole amount back on the entire balance, if you make a partial payment you will still be charged interest on the whole balance outstanding. Some cards have tiered interest rates geared to the amount you spend the more you spend the lower the rate. |
