Tuesday, 7 January 2014

Credit Cards ............. again

Greetings,

First of all a warm welcome to another new follower - how lovely !  Glad to have you here Vicket 43.

I've written about credit cards before, but thought I'd repeat myself as it is such a controversial topic.

Some years ago, I found myself in a life-changing situation, left alone with a huge farmhouse/smallholding to look after and no job !  so it wasn't rocket science, that while I got on my feet, I had to apply for credit cards.  I was successful in getting one or two, which needless to say very quickly got maxed out - I had spent my parents legacy (yes, awful I know !) in just trying to keep the roof above my head.  I also had a nasty habit called - eating.

Fast forwards, upon the introduction of 0%  balance transfers, I was able to pay these cards off by transferring them around and not paying any interest.

Now, almost everyone will tell you to cut up your credit cards, get rid of them and manage on cash alone.

I don't agree.


Now having been in a very 'tight' financial position in the past, I'm not advocating that you go out and max your cards and spend, spend, spend, far from it, but I never will get rid of mine.
They are my safety cushion, my peace of mind knowing that I can put my hand on some cash if and when life throws a financial thunderbolt at me again.

Not only that, if you don't have credit cards, it can actually act against you when your credit rating/score is being assessed, i.e you prove how credit worthy you are by paying regularly and not missing any payments.

But even if you don't close them down, don't let them just languish in a drawer, because if you don't use them occasionally, the card company will close them down for you, assuming you won't use them again.  So to counteract this, I use mine once a month  to top up with petrol, once a month to stock up with cat food, and once a month to pay the vet, then I pay them off at the end of the month.  This keeps the cards 'active' and pleases the Great Gods of Credit Cards.

So the reason I was prompted to write this is because this morning I had my credit increased by one of the lenders to over £5,000 !!  and no, I am not going out to buy a new car, a diamond tiara or book a world cruise, but it is comforting to know that amount of money is there in case of emergencies.  Of course it all has to be paid off, but sometimes you just have to do what you have to do.

So that's my take on it ...........

NOTE:  This is not financial advice. I am not a financial advisor.  I am just telling you how I manage credit cards and how it works best for me.  You must do what is best for you, I accept no responsibility. I am not getting paid for endorsing any credit cards.

take care peeps ...........




7 comments:

  1. I agree. It is comforting to know the money is available in case of an emergency. Our cards have come in handy several times, like when our refrigerator stopped working, and the hot water heater knocked off! Who has that much extra to spend without planning ahead!

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  2. I agree as well, very wise advice.

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    Replies
    1. It's reassuring 'cos I know I may need help later this year

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  3. I had to ask our c/card company to reduce our balance as they kept increasing it without asking and at one time we would have been allowed to spend 10k! which we never asked them for. Just too tempting

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    Replies
    1. Oh my word, that's a lot of money isn't it ? good job you didn't take them up on their offer, you would have spent the rest of your life paying it off I think !

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  4. This comment has been removed by a blog administrator.

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