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littlegreenman

Today, at the ripe old age of 44, I took possession of my very first credit card!

Never had loans or CC's before as I've always just saved up for stuff and been pretty frugal. So I'm looking for tips on how to use/ manage it to the full potential.

Pay each spend off as it happens/ weekly/ monthly/ direct debit?

I'm good with money so won't be using it for any major purchases, just looking for advice on using it to better me credit score really.

In advance, ta muchly

Phil_aka_Pip

Always pay the bill in full, on time. 

monofin

Tear it up and throw it away. Sage advice if my last bill is anything to go by!

VimFuego

post the number on here and we'll use it for you.

viz

Use it to get a couple of old 80s desert yellow and LNG Jems, and perhaps a Universe Swirl.

littlegreenman

Phil_aka_Pip said:

Always pay the bill in full, on time. 

That's the plan. Used it once already and panic'd, went straight to my on-line banking and paid it off. And that was for a £30 purchase!

Guessing I'll be OK for now...

littlegreenman

viz said:

Use it to get a couple of old 80s desert yellow and LNG Jems, and perhaps a Universe Swirl.

I are be already hazzing a JS1000, teh JEMs have a too wide neck for my girly handz

monquixote

Unless you are planning to use it for big purchases at 0% I suggest you set it up to pay off in full each month. 

You can then use it for things like internet purchases as you have better protection. 

chrispy108

Wait until the bill comes, and then pay the full statement balance a few days before the due date. It's worth setting up a direct debit up, either for the minimum payment, or for the full balance.

If you don't pay the minimum payment then you get fines and a bit of a hit on your credit, if you pay something between that and the full balance you pay some interest.

There is no point paying it purchase by purchase as you have. To build up a credit rating you actually need to use some credit, ie, borrow it, spend it, then pay it back when they ask for it.

Definitely do use it for major purchases! If you buy something on a credit card then you get great protection from the CC company.

chillidoggy

/\ Absolutely what he said, perfect advice!

EricTheWeary

I have gone wrong with credit cards and now have a direct debit to pay mine off, I just use it for online purchases and have one with no charges for use abroad. There are some with cash back offers and I keep meaning to look at the Tesco one which gives Clubcard points which is useful if you shop there anyway. As long as it's paid off each month then credit rates aren't an issue.

Grunfeld

chrispy108 said:

Wait until the bill comes, and then pay the full statement balance a few days before the due date. It's worth setting up a direct debit up, either for the minimum payment, or for the full balance.

All I'd add to that is make sure you check the statement -- because it's not impossible for mistakes. 

It's actually the reason why I don't use a direct debit -- I'm a lazy sod I might be tempted to not bother checking the statement.  So I've set up monthly email reminders not to forget paying manually by bank transfer.  But it "forces" me to check the statement.

Although it's only happened a couple of times in gawd-knows how many thousands of transactions I have had fraudulent entries on the statement.  You just report them and the credit card company sorts them out; it's not actually a problem.  But checking the statement is the only way to spot them.

Sambostar

littlegreenman, you sound a lot like me, I got my first credit card in my mid thirties, as the bank manager thought it was strange that I didn't have one.  Only on his validation did I manage to get one.  Prior to that I had no credit history, so basically a terrible credit record.  Always pay cash up front and only use to online, to repay the full balance at the end of the month.  When I look at about at all the new 'Tree and Garden Services' pickups about driven by kids with no experience or training or qualifications, they must all be on HP.  I think it is the norm, but everybody has credit these days.  Interest free credit makes sense, but sooner or later, it will accumulate interest. I'II stick with my Smiley Transit, not many on the roads these days.  I guess I am a dinosaur.  As for buying on a whim on credit. I can't think of anything more stupid, you could be run over by a bus tomorrow and left unemployed.  As for equipment I put new bearings on the crank and cutters and new generic piston and pot and rings.  I'II even import engines and hydrostatic gearboxes from the USA, as they are cheap.  Gear wears out quick when you hammer it everyday.  You'll never find me buying anything new on credit, I am a complete tight wad.  Of course I always assess my time vs. repair costs and down time, but my repairs always come in cheaper and take an hour or two.  Unfortunately, most of the kids who get their transits on HP haven't got a clue how to take an engine apart and fix things son they are stuffed, doubly stuffed when their Mk7 Transit starts playing up, out of warranty and without any service plan, just basic low interest HP for the cost.  Mk5 transits are like cockroaches, they would survive a nuclear war.

mike_l

As has been said, set up a Direct Debit for the minimum, so if you forget, the worst that happens is you pay the minimum for the month, and as soon as you can, pay the full amount.

Sambostar

I think if he has only just got a credit card at 44, I seriously doubt he will 'Forget' the balance.  VISA and MasterCard give you great online protection anyway...just don't pay through a third party like Paypal and expect it, otherwise, that protection will become null and void.

mike_l

I meant if he's put the bill to one side to pay when he goes into the bank (for example) it's easy to forget.

littlegreenman

chrispy108 said:

There is no point paying it purchase by purchase as you have. To build up a credit rating you actually need to use some credit, ie, borrow it, spend it, then pay it back when they ask for it.

@chrispy108, so does that mean build up a balance and pay it off once a month in full? That would be easy enough.

Or do you mean actually get in debt and then pay it off?

Noob questions I know, but having never done this stuff before I'm a little green (sic)

chrispy108

The first

Although the second doesn't hurt your credit rating as long as it's not excessive and you pay at least the minimum.

Your credit rating is a guess at how likely you are to pay future credit off, based on how you've handled it before, so you need to use it to have a rating. Not borrowing ever doesn't really help.

littlegreenman

I thought as much, and that's the plan.

Oddly, my credit rating has actually gone down a notch since getting the card! I assume that's a result of the credit check that happened in order to get it in the first place? Went from 890 to 844 on Experian.

Alnico

All you will ever need now is Ishibashi, a calendar and a pen.
Good luck and well done.