How to make the most of your credit card

If you are looking at applying for a credit card, it is important to first get your facts straight. What is a credit card? How does a credit card work? Is there a catch? Read on to find out the answer to all of these questions.

A credit card is the most common form of borrowing money. Though most will agree that a debit card is a better way of managing your money, a credit card is important for creating a good credit score and therefore it puts you in good stead for borrowing money in the future for transactions such as buying a house, car, or any other large purchase. A good credit history is important if you want to get the best deal, but there are also options for those who have bad credit. Go over to our "bad credit" credit card section for more information about your options.

After you begin using your credit card, you will receive monthly statements with the summary of your spending and the outstanding balance to be paid off. If you pay this off in full each month then your credit score should improve.

Can I apply for a credit card?

Each lender will have different eligibility criteria, so check before applying. However, there are always a few key criteria every lender will require you to satisfy:

  • UK resident
  • Over 18 years old
  • No rejected credit card applications in the last month
  • Not declared bankrupt
  • A consistent income

How do I apply for a credit card?

First you need to know your credit score so that you apply for the right card without the risk of rejection. There are many different score ratings, but in general, the ranges go as follows:

0-279 – Very Poor

280-379 – Poor

380-419 – Fair

420-465 – Good

466-700 – Excellent

If you fall below the ‘good’ category then you may want to take a look at the "bad credit" credit cards we have compared in our comparison chart. If your score falls into the ‘good’ and ‘excellent’ score then your application for a credit card is more likely to be accepted, but always look at the criteria for a card before applying.

Once you know your credit score you can begin to compare the credit cards that are out there on our credit card comparison chart. Do not jump at the first deal you see.

Once you have found the deal you want, you can apply here and fill in an application form with the provider, or you can apply over the phone or in person at a local branch. In order to complete your application, you will need the following information to hand:

  • Your UK address history for the past 3 years
  • Contact number
  • Email
  • Gross income per annum

Tips

An easy way to make sure that you keep on top of your credit card payments is to always keep your spending on the credit card at 30% of the credit available to you. Also keep a close eye on the card spending by checking your account once a week.

Most credit cards will charge a fee for withdrawing cash from an ATM, so refrain from making a withdrawal on your credit card.