Credit cards do not need to be a problem...if used wisely. (Credit Cards in general)

Member Name: thegarleon

Product:	Credit Cards in general
Date:	20/11/05 (150 review reads)
Rating:

Advantages: Off set your debt

Disadvantages: Treat them with the respect they DON'T deserve

The credit card is both the blessing and the curse of modern culture.Most people have one, even if it is only for "emergencies". However sometimes that emergency is a new TV or dress for that wedding.
The credit card idea is a simple one, but i will explain it like you or I come from Mars or Venus ( well, it's the ears and the blue hair):-

Lender / Card issuer-provides you with a credit limit based on your finacial scoring (credit rating or score), and will then provide you with their money for your use......as long as you pay it back!

Borrower / Applicant- person who requires the money or line of credit.

Terms and conditions-The conditions of use set on the card by the Lender, by which you have to abide.

Goods and services- What you buy with the card.

The Card- Little bit of plastic that you carry in your purse or wallet.
This is what the Borrower hands over to "pay" for the goods or services abiding by the terms and conditions.The card has an exclusive 16 digit number on it which ties the Lender and borrower together in one big happy circle.

Still with me? The whole principle is great. Free money and lots of it! If your face fits the demographic profile. Nowadays though nearly everyone does. Card companies are considering even riskier borrowers at a price.......to the Borrower. The one little thing I never mentioned above in my alien like description of the credit card is the dreaded INTEREST RATE. DUN DUN DUUUUN.

Cue the small print and over zealously complicated wording.
Blah Blah Blah

Now here's a thing.Ask yourself if you nodded along with the majority of the above? You are Their ideal customer. "Their" being Them. Yes it is a THEM and US game. That's all credit cards are. Not magical portals to the worlds of shopping but tickets in a big game that most people don't play right. I shall help you to play the game.Well, I will tell you how I do it and you can decide to join in or not.

Like with any game, in this game there are rules.However a lot of the rules are self imposed;

1. I must take my card with me wherever I go.
2. I must buy on-line.
3 I must use my (insert shop name)credit card in (inserted shop)
4.My credit card is my friend and the shop/lender that issued it is also my friend,because they give me money.
5. I have to pay the interest and accept the rate of interest.
6. I must become a joint card holder on my partner's card.
7.I have to use only one card at a time unless I have maxed it out and then I must get another card......and max that out too.
8. I must withdraw cash using my Visa.

The rules above are not stated anywhere in the terms and conditions of a credit card in their above form.So why do people think they must follow this game plan?
I have had 22 (yes twenty two) cards in my lifetime.
I have never paid a penny of interest.
I have never commited credit fraud to get a card or use it.
I have never stolen or lost a credit card.

If you do not follow anything I say in this review, please try and follow this one bit of advice. Be very wary of the credit card. Treat it like a wild animal that will bite if it is not shown respect. If you ignore it and hope it will go away.......It WILL bite.

The debt accrued by most people who fall fowl of cards is awful but entirely preventable. My main bits of advice on how I have never paid any interest are below.

1. Give your credit card a name.I call mine Freddy.For many reasons i won't go into.The reason for the name will become apparent. (Apologies if your name is Freddy)

2. Leave Freddy at home when you can.Don't laugh.It is the easiest and first rule.Why do you need Freddy to go for a night out? If it is to pay for drinks or entry into a club, then use your debit card. This is YOUR money. Freddy is not your friend. Every pount you spend on him....he takes back about 15 to 29pence.Would you take a sponger like Freddy out with you if he reached into your wallet/purse and stole £25 on average every time you spent £100, I don't think so.

3.Cut Freddy's ear off and stick him in a drawer! He still has his long 16 digit number and security number so can still be used for on-line or telephone purchases. However, if you work in retail you will know that if the corner has been cut of a credit card then it cannot be used. This way you will be less inclined to take Freddy out shopping.

4.Do not let your wife or partner anywhere near Freddy. By that I mean, don't take out an additional card for them. Freddy is bad, but his twin brother is far more mysterious,dangerous and more difficult to keep track of. I would not let Freddy anywhere near my wife!

5.If you do use Freddy for any reason,make sure that come pay day, you phone him up and clear him off. The pay day rule is very important and far easier to remember if you are paid at the end of the month. I pay off in full, when I am paid in full.

6.Never ever ever take money out of a cashpoint using Freddy.
This is the worst thing you can ever do.

Next. If you must have more than one Freddy then follow the advice below on multiple Freddies sorry, credit card playing.

I always use 2 cards at any one time. My gameplan has always been a simple one. Use one for everything, then bounce it on to the other.

I have a standard "supermarket" credit card that i get points on for every pound I spend. These points can then be exchanged for vouchers that can be spent in store on shopping or with selected schemes they nominate. just before the interest is added to this card I transfer it over (minus a few paid pounds, only a few to take it down to a round number) to my long term 0% card. Which ever one i am using at that time.

If you have a card which is charging you interest then transfer it NOW.As soon as you finish reading this, apply for any 0% card on line.Every second you accrue interest,you are wasting your money and giving it to THEM.FOR NO NEED. There are companies out there who are offering 0% for 12 months. Who are tripping over themselves to get your money, and hopefully your interest after the 0% is up.

The trick is to buy all your big things within a month if you can.Christmas shopping in March,The central heating, double glazing, m.o.t on your car,the holiday to France. Get a big amount to transfer accross, because normally you only get one free balance transfer when you start a card.

Put your new card away in the draw, or cut it in half because you are NEVER going to use this card for buying.Never ever.Not at all.
Every month of the 0%, you are going to pay off £100 or £150 of the large balance. Two months before the card's 0% expires, apply for another 0% card. To transfer the balance from the cut in half card onto, as well as whatever Freddy has robbed you of that month.

repeat the process as often as is required. Paying off a medium amount from your every day card. Transfer the remaining balance to a 0% card. Chip away as much as you can afford each month from the new card, before swapping this for a new one. Always cancel your old cards. You may need to take out a new card with them in the future! say in 18 months or so.

I have tried to be lighthearted in this review,please don't think i am being flippant. Remember not getting into debt in the first place is the major issue.If you do find yourself in a situation where you feel like things are spiriling out of control, please seek help.Various organisations are there to put you on the right track.The Citizen's Advice Bureau is a good place to start.

I am available via the comments or guest book for any clarifications on the principle I use.Please not that I am NOT a financial advisor and that this review is based purely on my own experiences on how to control spending on credit cards.

My Motto as far as money is concerned is
"I may not have much but I will make what little I have work for me and my family"

Take care and remember that just like pregnancy.....debt if easily avoided if you are careful,protect yourself and try to control your passion!

Summary: Get help before you get into too much debt.Think before you use.