Is There a Credit Card in Your Wallet? - By: Traderdog

There are many credit cards floating around at the moment. When looking at these, probably the best piece of information to keep in mind is that money does not come cheap where plastic cards are concerned. If you can manipulate your card to your advantage i.e., pay up your debt as soon as your monthly statement arrives, then - yes - money can come cheap.

Basically, when all the pro's and con's are assessed, the answer is Cash is King. But in today's modern life we often need other methods of buying goods and services. So what are the best ways of dealing with the situation?

Debit cards are where the money is taken directly from your bank account the minute it is used. The transfer of money from your bank to the company with whom you are making the transaction is instant. It will appear on your next bank statement.

If you worry about over-shooting your financial limits, this type of card will put the whole position in perspective. However, keep a sharp eye on the overdraft you have negotiated with your bank. Find out what rate of interest the bank levies once you over-step your agreed overdraft. This can be quite high.

Do you have a credit card? No, not a stupid question, in fact many people own more than one.

A credit card is exactly what it says. A card that allows you to purchase items on credit and you will be billed for the amount on your next monthly statement. Here you will technically have free credit for one month. On your statement you will be tempted with the prospect of making just a minimum payment of just �5.00.

Don't fall into temptation. This is stepping into a fool's paradise because your debt will continue to mount up each time you use this facility. The basic large amount will remain, plus the additional charge of any further purchases you making in that month. Interest rates can be as high as 14.5%

Store cards are bad news. Put simply - just don't apply for or use one. The interest rates can be as high at 29%. You can only use them in branches of the store that issues the card, i.e., Marks and Spencer, Debenhams etc. although some are branching out here.

If you do use a store card make a point of paying up in full each time you receive a statement. In other words, use it for your convenience and not the store's profit. Take the old fashioned view - you have bought and received the goods - so pay up.

There are a few credit cards that have a small pay-back to the holder. For instance, Tesco give reward points that accumulate. After your statement is rendered to you, you can use the amount you have 'saved' to purchase in store on your normal shopping bill. If you make a point of using your credit card at every available opportunity, but paying up your credit card bill as soon as it is rendered, then you stand to make quite a considerable 'pay-back' by using this method.

Should you get into trouble over your credit card with mounting debt, there are ways of overcoming this. You will need to assess your situation as to whether it is better to switch to a more advantageous one with better credit terms or take out a personal loan.

There is an easy way of dealing with this situation, but it will need your undivided attention to get rid of your debt.

From taking out a new credit card and to transferring your "debt" to a card that will give you a much lower rate of interest; to dealing with your debt if it exceeds �6,000 - this is all fully explained below.

Best of all, learn to think positive about debt. If you are in debt it cannot be ignored. Just take good advice, learn how to cope with your particular situation and you should gain some peace of mind.

Best of luck. For more information on this complex subject and many others, take a look at http://www.save-money-guide.com

About the Author

Traderdog is an experienced author with a passion for making her money stretch further. Anywhere that money can be saved is within her remit. To take advantage of this visit http://www.save-money-guide.com

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