Your money: credit cards and store cards
Credit cards offer a convenient way to shop for goods and services. Major credit cards can be used around the world while some shops offer store cards, which are much like credit cards but can only be used in the particular shop or chain.
Credit cards are never recommended for long-term borrowing. They are more suitable for:
- Buying goods or services as you need them
- Booking tickets
- Making online purchases - most commercial websites only accept credit card payments
- Spreading the cost of expensive events such as Christmas
- Avoiding the need to carry large amounts of cash
- Paying for expenses when abroad
When taking out a credit card, always check the normal rate of interest to ensure you're getting a competitive deal. Keep within your credit limit, always pay off your outstanding balance in full each month, and avoid transactions where fees can mount up, such as using your card for cash withdrawals.
If you have credit card debts which are becoming a burden, consider taking out a loan to clear the debts. The interest rate on a personal loan or even on an overdraft will usually be lower than what you're paying on the card.
If you have debt problems, the Money Advice and Budgeting Service (MABS) gives free advice.
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