Make sure your plas­tic friend is as flex­i­ble

The Scotsman - - Farming -

1Wipe

the slate clean

Be­fore you start, make sure your credit rat­ing is good – you can or­der an on­line re­port from Ex­pe­rian, Equifax or Call­Credit for just £2 if you’re in any doubt.

2When

cheap­est is best

If you tend to pay off your credit card bal­ance in full in some months but not oth­ers your fo­cus should be on the low­est in­ter­est rate. The best way to com­pare in­ter­est rates is to look at the APR (an­nual per­cent­age rate) charged on pur­chases. But also check out the amount of time the credit card al­lows be­tween mak­ing your pur­chase and start­ing to charge in­ter­est – most tend to al­low 59 days, but some start charg­ing right away. Once you have your card the rate can change, so reg­u­larly re­view the rate to en­sure it’s still com­pet­i­tive.

3bal­ance

trans­fers

If you’ve built up a credit card debt then trans­fer­ring the debt to a new card that of­fers 0 per cent in­ter­est for a set pe­riod on bal­ance trans­fers can help you get back in con­trol. If cur­rent deals con­tinue, you could avoid pay­ing in­ter­est on your credit card debt for any­thing up to 16 months, giv­ing you plenty of time to try to clear it.

4breath­ing space

If you know you’re go­ing to have to hit the plas­tic in the near term and won’t be able to pay off your bill in full each month, a card of­fer­ing 0 per cent in­ter­est on pur­chases for a given pe­riod of up to 13 months could be the so­lu­tion. These cards can also be use­ful if you know you are go­ing to have a short-term fall in in­come or only work sea­son­ally.

5bonus fea­tures

If you pay off your credit card ev­ery month with­out fail you can af­ford to fo­cus less on find­ing the low­est in­ter­est rate and more on be­ing re­warded for be­ing such a good cus­tomer. These days you can ac­cu­mu­late air­miles and loy­alty points, claim cash­back or make char­i­ta­ble do­na­tions, so you re­ally can get some­thing for noth­ing. With cash­back cards, bear in mind that some of­fers are only tem­po­rary and may only run for the first six months and some only ap­ply when you spend on spe­cific items.

6Watch

the rate

A grow­ing num­ber of cards now of­fer 0 per cent

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