Your are viewing a read-only archive of the old DiS boards. Please hit the Community button above to engage with the DiS !
time for a spending spree ooh yeah...
now it makes perfect sense, and i'm further on the road to a great credit rating.
And it was alternately terrifying & hilarious how many people simply didn't realise you had to pay the money back.
Leave this baby for a while and there'll be a thousand ^This-es before you can say "minimum payment".
arises when interest is added to the principal, so that from that moment on, the interest that has been added also itself earns interest.
The equivalent yearly rate may be referred to as annual percentage rate (APR)
When a fee is charged up front to obtain a loan, APR usually counts that cost as well as the compound interest in converting to the equivalent rate.
and paying it off, improves your credit rating, moreso than not ever having a credit card. can someone confirm/deny?
as someone with no credit rating is seen as a risk, but there are much easier and less costly ways.
Set up a direct debit/standing order between yourself and a friend/family member. Just moving a tenner back and forth once or twice a month. Every successful automated payment helps your credit rating.
Any bill that's paid on time every month will improve your credit rating - including mobile phones.
There are so few advantages to having a credit card, it's really not worth the debt.
but you have to pay the full balance, in which case you could just use a debit card.
If you spend £200 on a credit card and only pay your minimum payment every month - it'll take you about seven years to pay it all back.
i got lucky actually, cause i over spent around the festivals so had an extra £500 on a credit card that i borrowed from Spetember and October, so it worked out nicely. it's just a bit of extra insurance.
Paying it off on time implies you don't 'do' credit. They like someone they can feed off. If you're all "I spend within my means" then they know they'll never get rich off your back.
Your credit report shows like this for each creditor:
Each slot is a payment cycle (usually a month), each number means the number of missed payments at that point.
A line of zeroes for each creditor is the optimal score.
Contrary to popular belief, credit card companies do not profit more from delinquent payments than timely ones. Lending companies have to prove their success at recovering owed money in order to borrow more. They have a similar thing to a credit rating based on how many customers are late with payments. If all their customers pay on time, they get to borrow more money at better rates.
But I'm thinking Theo means not paying it off IN FULL can increase your credit rating. Which I am led to believe to be the case.
It's one for the advanced credit rating manipulators, thought. Most folk probably wouldn't bother (or wouldn't be able) to 'game the system' in this way.
A zero is reported whether you pay your minimum or the full balance, provided you pay it on time and don't close the account.
Any additional detail is only requested in extreme circumstances, so there's no benefit to 99% of people.
I'm not making that up. They've been taken to task over it a few times.
I moved it to as close to the start of the month as possible a few years ago. It's now mid-month again.
They even had the FUCKING GALL to send me a text message the other day when I'd missed payment. Not one 3 days before to remind me, oh no.
I have to be careful using my employers name, so if you know where I work - please don't say.
We are told from day one that the most important thing is getting customers to pay on time - it's impossible to rely on late payment or overlimit charges for profit as too many customers end up having their account charged off, going bankrupt or some other means where the debt - including the charges - is wiped.
We are now getting rid of potentially bad customers earlier than ever before - after very few missed payments in succession.
When they blocked my card overseas I discovered that if you're hold long enough they change the message to say, "We've got a fire in the building. Ring back later," and cut you off.
Unless they happened to have two fires in the building within 24 hours of each other! :D
i'm just thinking: for example i pay my rent monthly via direct debit, pay my phone bill fine each month - i'm getting a good credit rating and don't have much to gain from a credit card then?
Pay all your bills on time and you don't need to worry about your credit rating.
although that credit rating system's a bit worrying: a fifty year-old guy will have a line of 600 numbers
or do lots people survive without?
stops ya getting ripped off by ticketmaster cos you can buy tickets straight from the source instead, and makes ordering albums online so much easier
can be done with a debit card, surely?
Wassup with Ticketmaster? Do they not accept debit cards?
Try buying two chalets for ATP with a debit card. If you have that much money lying around in your current account your more stupid than someone who doesn't pay off their credit card.
i keep a sizeable chunk in my account - it's basically the accumulation of a few months' wages that i try not to go into if i can avoid it. i transfer £250 a month into a high interest account, and i have an ISA [got my first one this year]. what should i be doing with the rest? i always spend within my means but i like having a decent chunk at my disposal should i need it, which won't impact on any savings plans i have [e.g. i don't wanna be dipping into savings accounts when i need to pay for something big].
Basically if someone steals your card right now they can spend all that money and you have to wait to get it back.
If you've put it into a savings account they are limited.
I move money back and forth to my ING savings. Admittedly interest rates are so shit that I don't get much for it but having the money waiting there it's still getting SOME interest.
If you feel you need that money in your account for emergency expenditure then you can use a credit card, knowing you don't need to pay it off for a month and while you don't need to your money's earning you interest. I will admit, though, that if you habitually need cash for those emergency expenses, or something, then that's fair enough. There are always exceptions but I spent years with far too much cash just in my current account until Barclays called me in for a meeting and told me this really wasn't a good idea...
I also have an ISA for the 'heavy' saving. Clearly I don't take cash out of that unless it's something really big. I don't see what's wrong with moving money back and forth when it's only a question of logging in and doing a few clicks?
i think of money in terms of.. i suppose, water levels?! i.e. when money in an account reaches x round number, i don't want to let it dip below that. my bills come out of my current account so that fluctuates [though i still get a pang when it dips below a certain amount] but i want to know my savings are something solid that i don't need to think too much about, just let the money accumulate. also the savings account i have right now has a decent rate of interest for the first year and i don't want to touch it at all while it's doing its thing. [next year i'll move everything to a different account with a nice intro rate.] and my ISA i obviously want to leave well alone.
i know everything will add up to the same number regardless of the accounts i keep it in, but psychologically i like the idea of a 'touchable' money pile and a little accumulating pile that no-one can take anything from.
until 3 years ago i was DREADFUL at saving, i lived at a permanent balance of nothing. rarely owed much, but it's been a point of pride to do all this saving and i don't want to shoot myself in the foot by losing track of how much i should have.
also at some point i'm going to have to file a tax return and maybe pay a big chunk of tax [financially i'm self-employed] and i REALLY don't want to go into my savings for that... it would actually hurt me.
the isa - you said heavy saving - that can only be £3600 in cash though, right? [though you can have others from the previous years? effectively closed ones if you're not taking anything out, cos you can't add anything beyond that amount...?]
you don't need to open a new one. However this year I found it beneficial to open a second one as it had a better (but still shit) interest rate.
so it's just a maximum deposit per year, not a cap on the actual account.
i think every year i'd likely shop around for the best interest rate. i do everything with barclays at the mo but i'd like to get something elsewhere so i'm not too tied into barclays.
the latest was a "Golden ISA" which was a little bit better. They also do that 5 year bond at the moment at something like 5.5% interest but you can't touch that money for the entire period. I can't guarantee that I wouldn't.
Also they've upped the cap to £5000-odd, though I barely scrape £1500 a year into mine in any case.
But the valid situation where you wanna buy in bulk for your buddies is unrelated to the original comment of "I just found i had to get one in the end. Stops ya getting ripped off by ticketmaster cos you can buy tickets straight from the source instead".
However, I didn't realise you really just meant when buying from Ticketmaster, even if my reply did relate to that.
just takes up space in my wallet.
"When you cancel your cards, by definition you have less available credit. This is a boost to your credit score as it means potential over-indebtedness is less of a problem."
"...there's a strategy for choosing which cards you should cancel and which to keep."
disciplined indivdual credit cards are great, ive had several, but i only open one when i have a big purchase in mind,say my fat hdtv. Pick the one with the longest interest free period, stick the purchase on that and instead of dropping a big whack in one go you can pay it off slowly over the year, leaving you more money to gain interest off in your account. Same applies for car insurance, instead of paying that monthly to the insurance company, which costs more than the full amount, just put the full amount on an interest free card that offers 12 months and your golden.
As long as you pay them off before they start charging interest they are lovely. Then i just close it.
moneysavingexpert.com has more interesting ways of using credit cards to your advantage, reccomend it
i'm in over my head here. i just thought it was like a card that you could use to buy stuff off the internet - what's all this apr, credit rating, interest gubbins...
and you'll be fine.
The aforementioned www.moneysavingexpert.com tends to spell things out quite well (even if the site has an ultra garish design).
i love Martin Lewis.
You're the OP that's just got the credit card.
Please tell me this is all just a bit of a joke.
it's just like taking money out of your account, no? seems pretty reasonable
but i never thought of looking into a debit card..i've just never heard of anyone i know using one? oh well i'll look into it. can credit cards be cancelled easy enough?
What? That's how it works. Don't you even have a cash point card? WTF?
i have no idea but i think you've missed the point somewhere along the way? calm down
There's a card you get with it that goes into the cash machine so you can get cash out, yeah?
It's a rare individual for whom this isn't also their debit card. Mine's got a Visa symbol on it; others will have Mastercard (or something) on them. It's got a 16-digit number going across and that's what you use.
If you can get a credit card it seems weird your bank wouldn't have given you one of these by now.
i thought an atm card is an atm card. how naive of me. maybe the bank could have pointed that out to me? i'm not a financial expert. so essentially you can use your bank card to order tickets/records online, is that what you're saying? news to me.
maybe things are different over here, dunno, cos i've never heard of an atm card being used as a debit card
Apologies then. I didn't realise they do things differently over there. I just assumed it was the normal way of things. My mate moved over to Dublin and never mentioned it but maybe he got is account converted over and they just set him up the same way as a result.
my AIB atm was just a bank card until very VERY recently - when they sent me a new one that can be used online. it's not a lasercard.
for everyone else, i *think* in Ireland you never used to have the one card for both, you had an atm card and a debit card. something like that. though i'm not sure.
not that many people i know in ireland have debit cards. they have atm cards and credit cards.
or by credit card?
And don't have a debit card that will act all credit card stylee, but take money straight from your normal current account?
But then don't US-ians sometimes have one card that can be used as a debit OR a credit card?
looks like i'm not such a big thicko after all.
Or you've never worked or gone to uni, surely?
i've not used it since i was 16, and i've no idea what my PIN is, but i've got it. i keep meaning to check out what i've got in there. i hope i wasn't allowed to take out more than i had in the account, otherwise i might be in debt by thousands! i think i'd know about that though...
I've got a smile savings account with a cash point card.
I think it's pretty clear that I was discussing the very unlikely situation of someone not having a debit card at all and being over the age of 18.
And wasn't seeking to contradict it.
But having read some of the oblivious/curveball comments in this thread, it's prolly best that every possibility gets pointed out.
We still haven't established how someone has apparently got a credit card before a debit card. It sure is a bit of a WTF.
Who issued it? What's the symbol on it?
Be aware that if you withdraw cash from a cashpoint using a credit card, and then you buy some stuff on the credit card, but don't pay the bill in full from your next statement, some companies will deduct whatever portion you do repay from the card purchase first. Leaving the cash withdrawals to be repaid last. They do this (and many more cynical things) because the cash withdrawal attracts a higher rate of interest than the already high rate of interest that they charge on your card purchases if you don't repay in full at each statement.
easy with the patronisation
You're all like: "Got a credit card / gonna go on a massive spending spree / some irrelevant shizzle about Ticketmaster and how it's easier to buy online with a credit card / what's all this apr, credit rating, interest gubbins / it's just like taking money out of your account, no"
And sadpunk, Theo, others, and I are all like: "We hope you understand the implications of a credit card cos it's easy to get sucked in by 'em and, from what you're saying, you've prolly not got the best handle on the whole shebang, so how's about we give you some basic pointers, yeah"
And you're all like: "Get out of my grill."
And I'm all like: "Woah there. Easy tiger."
I'm/we're just trying to be helpful.
how is it?
as for the other stuff, not my fault the bank didn't explain things to me properly. i appreciate the advice, thanks
Is this card also your cash point card for your bank?
is that it has your bank a/c no (8 digits) and sort code (2-2-2) on it.
The payment bit says "Select Credit Card" but it lists Maestro (which is a debit card). And as I understand it, the Visa option applies to a visa credit card OR a Visa debit card.
So my point stands. You can pay through ticketmaster with a credit card OR a debit card.
On this topic...
Visa debit cards used to be called Delta (or Electron, if it was a no overdraft account), which made the distinction between credit cards and debit cards more obvious.
Similarly, Maestro (with a logo that looks like Mastersard credit cards - who run Maestro) used to be called Switch (or Solo, if it was a no overdraft account), which, again made made the distinction between different types of cards more obvious.
Both branding exercises are fairly insidious moves that are (at best) designed to blur the line between credit and debit cards, or (at worst) intended to confuse folk.
i'm talking about BYPASSING ticketmaster and buying tickets direct from venues. if you don't live near the venue, the only sensible way to do this is to order online. for this, as far as i know,you need a credit card, at least in ireland
Never do this.
Using Credit Cards for cash is a big warning sign to your creditor.
Also, never ask for a credit limit increase as this also puts a fat warning sign on your account.
Only that creditor will see the warning sign, so it's not a massive worry, but still...
Well what I said to the power of ten, then.
Jeez, I never get cash on a credit card cos I know they're harsh about it. Didn't realise they were THAT harsh.
Good heads-up there.
If you signed up to Barclaycard they gave you £15 free off your first purchase and she decided to just use it in the cash point to take the money out. :(
Sorry, but it's true. What the fuck is up with people here. Maybe get some fucking self-control.
Credit cards are there for the times when you need to buy something before you have the money available.
Case in point: Pavement ATP. I bought a 6-berth and 4-berth chalet to the tune of almost £3000. I have that much money in savings to pay it off assuming that people can't pay me back in time (and I know a bunch of people won't be able to for a while) but I doubt I could have moved that money to my bank account in time to pay it.
Moreover, because credit card bills work on a monthly basis I will have to pay this £3000 off in November or (if I'm lucky) December, depending on the cut off point for the bills. That means 1 or 2 extra months of interest on that money in my savings account and it also means the people with me in chalets get 1-2 months to get their money together.
You pay it off in time you don't pay any interest. It's fucking great.
i just couldn't be bothered to wwrite that much when i was too busy making ghuggy ghuggy sounds and grinning about Max Cavalera.
If you use a credit card properly, you want have any problems.
Saying "get some fucking self-control" is a bit harsh though.
No one should be a in a situation where they can't afford to live without putting things on a credit card. If they are then I totally feel for them and I'm not aiming that at them.
But people who are strangely scared of credit cards because they will spend money they don't have...well get some fucking self control isn't really harsh, is it?
[a] i don't feel the need for one - my debit card serves me in every situation
[b] i always spend within my means but don't like the idea of spending money that isn't mine, or being at risk of credit card companies behaving badly [e.g. moving payment dates etc as reported here]. while i'm fairly good with my finances i'm not so attentive that i remember to check things as often as i should - i just set up standing orders for things i owe.
My credit card gets very infrequent use. I don't leave my current account empty I just don't have the spare cash to, say, spend £300 on something if I find I want it unless it's fresh after payday.
But otherwise it's just a card in my wallet and whole months go by with nothing to spend on it.
The dates of payment don't change suddenly, they creep forward over the course of months. HOWEVER, when this has resulted in me being late for a payment I ring up Barclaycard and give them shit for it, pointing out I always pay the bills off and they refund me the interest because they know it's their fault I didn't check the site at the right time.
I think people are worried they will miss payments more than it's actually likely. You get a paper bill and you can set reminders.
and rent/mortgage by credit card then? how d'you do it so it makes you more money than doing it from yr current account? d'you pay on credit and then pay back from savings?
but they're all on standard rolling amounts with each utility so I know how much money I'll need in the account to cover the debit. If it's going into debt with the utility they will up the rate and give you notice or you can ring yourself and change it.
Rent, too, is a known quantity.
I'm probably misunderstanding your point of spare cash in your account. I mean really 'spending' money, stuff that you would use to buy anything out of the ordinary round of food and drink.
You CAN use a credit card to pay off bills, I guess, but it would be more troublesome.
(Obviously, Lo and I now have a separate joint savings account that we use to pay bills and mortgage so every month after pay day a chunk goes in there so it's actually simpler for me to know what I can or can't put into savings.)
but they are useful for big purchases where you want some extra protection
I got them on my credit card cos I didn't want to take any chances at all that my holiday spend would be scuppered by Thomas Cook going into bankruptcy (of which there were faint murmurs of at the time).
But I was under the impression that Visa extended this cover to their debit cards (but not Mastercard to Maestro, though). Not tested this theory though, and didn't wanna take ANY chances in this case.
Good old Working Lunch:
"A Visa debit card offers significantly better protection for shoppers [compared to Maestro]. Their scheme is called Visa Debit Chargeback and any bank that issues a Visa debit card has to comply with the scheme.
You can claim money back if the goods you buy are damaged, or the product or services are not delivered.
There is no limit on what you can claim. But you have to claim within 120 days of the date you expected the goods to be delivered or the firm going bust.
You get better protection if you use your credit card.
The key difference is that when you claim on a credit card under Section 75 of the Consumer Credit Act, the credit card company is legally liable.
But the Visa Debit chargeback scheme is not legally binding, so you don't have any legal redress if you are unhappy."
use it as insurance or to improve credit rating, the best thing to do is to pay off the balance each month that way you pay no interest and whilst you arent 'doing' credit if you become a victim of fraud your a damn sure lot more likely to get your money on the credit card back then if it was to happen to your bank account.