Nearly everyone will get a credit card at some time of his or her life. While they can catch people out and squeeze high interest payments, credit cards can often be incredibly useful, and can save you money or even help you earn it. However, the marketplace for credit cards can be perplexing to newcomers, largely due to the volume of different products available. If you're in need of short-term credit, but aren't really sure where to start, take a read of this article for some advice.
Purchases and Cashback
Some credit cards can encourage you to spend money or give you 0% interest on purchases for a limited period. 0% on purchases is especially useful if you want to make a purchase that you can't cover with your current account, because you won't pay any interest on the outstanding sum for a limited period. Two cards with particularly long 0% periods are by HSBC and Halifax. Cashback cards, meanwhile, encourage you to spend on your credit card by rewarding you by giving you money back. American Express Platinum gives 5% cashback for three months, the up to 1.5% after. If you want to go for cashback, it is absolutely essential that you pay off your card in full every month; otherwise your interest payment will outweigh any cashback incentive.
Balance Transfer Cards
This type of credit card allows you to transfer an outstanding balance from a credit card onto it, preferably with a 0% introductory rate. You normally have to pay around a 3% fee for a transfer, but it can often clear existing debts which you pay interest for. The best credit cards for balance transfers are MBNA and Virgin Money (same provider) they offer 0% if you transfer a balance to their card for 15 months, and you can even transfer into your current account.
Other Types
While 0% deals on purchases or balance transfers prove to be very popular, you may find that other cards suit you better. For instance, if you take a lot of international business trips during a year, then a British Airways American Express card might be for you. Also, another popular move for some banks is to have ethical credit cards, such as offered by Co-operative Bank. This gives you special rates if you purchase from ethical partners and a small fee is given to charity each time you spend a certain amount. When selecting a credit card, the golden rule is to consider exactly what you need it for. If you spend most of your money in the supermarket, then you'll probably benefit most from getting a card from one of the major supermarkets. Consider what you'll need your card the most for, then search for it on Google. After checking a number of websites you'll more than likely find the right card for you.
