Borrowing money with a credit card isn’t always the best idea as they have high interest rates compared to loans and are also very easy to get into debt with due to the ease of spending on them. That said if you have already decided you need a credit card then take a few minutes to read about the different sorts and see if one might be better for you than another.
The best credit card for student
If you are a student then choosing a specific student credit card is usually the best option for you. It is important however not to be swayed by free gifts and to consider the longer term. Which has the lowest interest rates and are these rates guaranteed for a specific length of time.
If you have a good credit rating already do check if a regular credit card is an option for you. Sometimes you will be surprised that you can get a better rate with a regular credit card than you would with a student card!
Are Store cards right for your spending?
If you are looking for a credit card to buy a one-off purchase that you need such as a washing machine, a new gadget or even an outfit for an event then maybe a store card is a perfect choice.
The difference between a store card and a regular credit card is generally that you can only spend on that card in that particular store or others in the chain/group. This means that you are less tempted to spend money on the card for things like petrol or food shopping and get yourself in further debt.
This sort of card is perfect for those who need credit for a single purchase but want to avoid being tempted to buy other things on credit.
Should you get a prepaid credit card?
There are very few instances where a prepaid credit card is ideal in my opinion unless you are working to a budget and want to allow yourself just a certain spend whilst out somewhere. A prepaid credit card has no way of spending more than you have on it, think of it like a gift card you can use anywhere, or cash.
Choosing a standard credit card
When choosing a standard credit card be sure to compare the interest rates at different accounts and also look to see if there is an interest-free period. If you are only needing to spend money in the short term and can pay it back within a few months this can be a way of essentially borrowing interest-free. Be sure however to always pay the minimum payments and read the small print and either pay it off before the end of the 0% period or get a balance transfer to a 0% balance transfer card.
Don’t be tempted to ask for a credit limit of more than you need. This can encourage you to spend excessively but also means there is more chance your application will be declined!
