Managing Your Credit Card

R

RebeccaMc

Guest
Hi everyone

I'm just looking for tips on how others manage their credit card balance. I have been through the whole "target not a limit" scenario with credit cards before and eventually clawed myself back from the edge of financial disaster. To try to keep myself under control, I restricted myself to one credit card (Tesco) and gave myself a manageable limit of 500 euro. In a further effort to keep things in check, I try not to bring my credit card with me all the time.

I'm a bit embarrassed that I can't keep the head with it though and would love to get into the situation where I could use the card sensibly for groceries, petrol etc. (and get my Tesco points) and keep to paying off the full balance on a monthly basis by direct debit. I manage my current account down to the last cent, so I just wondered how others (who pay off the balance and full) keep track of what they spend on their credit cards? Is there any way around turning it into a big rigmarole?

Thanks
Rebecca
 
Hi Rebecca

It appears that you are spending more per month than you earn. You are able to manage your current a/c but then fail when it comes to your credit card. I suggest that you stop using your credit card for the next 4 months. This will perhaps give you the opportunity to get it back into the black. If4 months isn't enough time then wait until the debt is completely cleared before you begin to use it again. Be firm with yourself.

During this time detail all your expenses and payments. Then you should be in a position to know exactly how much per month you can afford to spend. Pay back your credit card bill in full each month. For the first couple of months pay for your groceries only with it. Then gradually add on other expenses which you know you can afford to pay back within the month.

Credit cards are extremely useful but only if they are used to the advantage of the consumer.

Marion :hat
 
Hi Marion

Thanks for the advice. Although I think I misled you slightly; my credit card is in the black at the moment (and has been for eighteen months) and I have the checks (low balance etc) in place to keep it under control. However, I'm fairly savvy in lots of other financial areas and would like to move on from being afraid I'll loose the run of myself.

I pay off the balance in full every month but only because I barely use it. I know it would be more clever to make wider use of it and get my extra points and not carry so much cash etc. etc. and pay of the balance in full. I was just wondering if some of the contributprs who do this could give tips on how they keep track of the balance (I think I remember rainyday and maybe daltonr saying they did this).

Thanks
Rebecca
 
HI Rebecca - I don't really keep an eye on the balance, though if you have internet banking, you could probably do this yourself. Have you tried setting up a direct debit to pay 100% of the amount due, so that you know you will ALWAYS have to come up with the cash to clear the balance?
 
Watching the balance

Rebecca,
I use a simple spreadsheet to track my current account and credit card spending. Nothing fancy with bells and whistles mind, I just keep a record of all my spending and cash withdrawals. if it matches the bank and credit statements each month there is no problem.

I think it is important to closely monitor your credit card balance at any rate to help fight fraud!
 
Credit card points

Hi Rebecca,

think of it this way: the Tesco points you would get pale into insignificance once you start paying interest charges! So stop using your credit card completely, unless it is for something like booking flights on the net, where you need a credit card. A good trick is to put it in the freezer in a bowl of water (seriously!). The idea is that this rules out impulse purchases, as you have to wait for it to defrost. Never carry it in your wallet.

This is much more clever than amassing Tesco points
cheers,
Diziet
 
Credit Card

Microsoft Money is good for this. Just set up a Credit Card Account as one of your normal Accounts. Then enter everything you use your card for - that's the trick of course, to be strict about entering everything so that you know exactly where you are ! Then you can see at a glance how much will go from your current account to the credit card account at the end of the month.
 
Credit Card

Rebecca

Just wondering why you would use CC for groceries / petrol etc. Why not use laser card and you're paying for it straight away and there's no risk of interest charges. If you can't use your laser are you living beyond your means? Personally I only use my credit card for flights, hotel and when I travel abroad. I clear the bill every month and never pay a penny of interest. Also a tip to get 60 days interest free. If you are buying a big ticket item & need a few weeks to get the money together - purchase the item the day after your CC bill is issued - in my case that's 21st of the month. Then you will have almost 60 days interest free credit. It's up to use to get have our credit card benefit us & not the banks!
 
Same here. I only really use the CC for large purchases (e.g. to avail of whatever purchase insurance is on offer), online purchases and when travelling (usually pre loaded with cash when abroad especially in non € zones) and I always clear the balance each month. I use the Laser or cash for most other purposes. Most people I know who use the CC for everyday purchases are terrible at managing their money.
 
Hi Diamond

Just wondering why you would use CC for groceries / petrol etc. Why not use laser card

The Amex Blue card gives you cash back of 1% on all purchases. I have already accumulated €120 on the card with 2 months to go. This will be used to pay the stamp duty on my other cards. I use my card as if it were cash. I don't pay any interest on the card. Tesco also give a cashback of .5%?

Unregistered, I think you might be right. I spend too much :)

Marion :hat
 
Marion,
Where can one get an AMEX blue CC? AAM is the only place I have ever heard it mentioned.
Thanks,
ajapale
 
Hi Ajapale - See [broken link removed] for more details of Amex Blue.
 
mairon do you find many places that accept it?

we have a credit card machine in work to accept payment and we cannot accept amex on our machine
 
Re Amex Blue

Amex Blue is not as widely accepted as Visa/Mastercard - personally would not use one.

It used to be the case that retailers would not receive the money from Amex for a significant time longer that V/MC and therefore wouldn't accept it.

Not sure if this is still the reason
 
Re: Re Amex Blue

Thanks for all the replies everyone. I'm going to set up a spreadsheet for myself and bite the bullet and organise a direct debit to pay the full amount monthly.

Marion is right in suggesting what I'm trying to do. If I can manage to adopt a mature attitude to my credit card spending (here's hoping) and use it as if it were cash for everyday items and substantially increase the throughput on it, there's good savings to be had. First of all, I manage to have the stamp duty credited this year by having spent over EUR5000 on the credit card (I didn't pay a cent of interest in the year), so I got my card for free.

I don't have an AMEX blue because I only want one credit card and it's not that widely acceptable, so Tesco's was the next best thing for me as you get 0.5% (and 1.5% back on Tesco groceries paid for by Tesco CC) back in Tesco points which you can use like cash in Tescos to buy whatever I want. I do most of my shopping in Aldi and Lidl so when I get my vouchers I have a great time stocking up on lots of little "luxuries" (nothing mad - just decent coffee, branded toileteries, indian takeaway and other things I like) in Tescos safe in the knowledge that they are for free. I'm a bit of a bookworm too and Tescos are the cheapest for bestsellers near me, so I get extra points if I buy them there and use my credit card. I'm beginning to doubt the economics of the special trip to Aldi versus buying Tesco own-label and using my CC.

I know I sound like a ranting ad for Tesco, but I have nothing to do with them ... honest. I just like to knock the last cent of enjoyment out of my euro.

Rebecca

PS&nbsp &nbsp &nbsp &nbsp RebeccaMc = MissRibena - I forgot I'd registered at home seperately. It's not some evil ploy to pretend I'm two people or anything :)
 
Hi Gar123

There are many retail outlets that don't accept the AMEX blue. But, as you can see from my post above, there are clearly a lot that do accept it.

If I didn't have an AMEX (1% cash back) I would opt for the Tesco card (0.5% cash back). These cards are good value if they are managed correctly.

I have never been afraid to use my credit card. I accept that some people just don't like the idea of using these cards for day-to-day expenses. But, this has never been an issue for me. I prefer using them to cash.

Marion :hat
 
I like lists!

Rebecca, I just use a few pages in the back of my diary to list my credit card transactions. I shove the receipts in my purse, and every few days (or weeks!) I transfer the amounts to my diary.

I also check my account online every now and then, it's particularly handy for foreign transactions when i don't know the exchange rate.
 
Amex Blue

Have the Amex Blue, and can recommend it.

Point regarding the widespread acceptance is valid though.

Marks & Spencer, Ryanair, and a number of other big names do not accept Amex of any kind. Have also had difficulty getting cash from ATMs abroad. Ditto ticket machines on Heathrow Express etc.

Use the BoI Visa as a backup in these instances. Probably not the most cost-effective, but the Amex cashback covers the stamp duty on both.
 
Zou

Unless you have the BOI visa for a specific reason it might be worth your while switching to the Tesco card after April 01 next year and avail of the points there as well. You may as well make all your cards make money for you.

Marion :hat
 
Any retailers out there who could tell us what the commission for Amex is? I seem to remember it was a different order of magnitude to the mainstream cards. If so this might explain the low acceptance levels.
 
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