The Credit Card Dilemma

The Credit Card Dilemma

Part One:

Are you totally confused by the wide selection of Credit / Debit Cards that are available?

Narrow Down Your Choices

• Go through the list of various cards – highlighting the ones that you believe you will not be able to get.
• If for example you are not a student, you can eliminate Student Cards
• How is your Credit Score? Have you been in trouble and lapsed on your payments to Banks, Stores and other Creditors? Or are you a Bankrupt or has some Creditor taken you to court? Answer yes to any of the forgoing questions and your chances of getting a Credit Card – are very low.
• If your Credit Score is rubbish and knowing your chances of getting a Credit Card are almost nil – you can cross off your list of possible cards to apply for, any with the words 'Credit Card' on it.
• So if your previous Credit Score is less than perfect and you have eliminated all Credit Cards from your list – what have you got left?
• Debit Cards – your saviour. Having a Debit Card is not a stigma – you have nothing to be ashamed of, people from all professions have found themselves in financial difficulties at times.

Therefore, with a Debit Card you can do practically anything you can do with a Credit Card.

The big advantage of having a Debit Card is that you can't get into any further trouble.

You have to fund a Debit Card yourself.

How Can You Fund Your Debit Card?

• From your Current Account
• Have your Salary or other regular money paid into your Debit Card
• Transfers from your Savings Accounts into your Current Bank Account.

Is There a Limit to How Much You Can Spend While Using a Debit Card?

You are limited to how much you have in your Current Account at the Bank or Building Society.

• You can't overspend
• If you do go over your bank account balance – and you haven't an Overdraft agreement with your bank, you won't be able to pay for whatever it is you are trying to buy or pay for.

This can be embarrassing – especially if you are holding up the queue at the supermarket, but it's not going to get you into any further debt.

How Can You Make Sure You Don't Embarrass Yourself?

Try to keep an account of all your money received into your Current Account and your Expenditure – money being paid out

· Check your Bank Balance online daily.

· If you have Direct Debits or other regular payments coming out of your Current Account – make a note of whom you are going to pay - the date due and the amount.

If you have a wall calendar – and you have made a note of dates payments are due - as you mark off each day … you will have a reminder of what's due that day.

This could mean that if you are due to pay Joe Bloggs that day and having checked your Bank Balance – you haven't enough money – be sure to contact Joe Bloggs, explain to him the situation and promise to pay him some date in the future. Never make rash promises that you can't keep. Better, before phoning your Creditor, seriously work out when you will be able to pay him – and keep your promise.

You will find that if you keep your Creditors in the picture, they will treat you with respect and make allowances for you. Nevertheless, as said in the previous paragraph – make no rash promises.

If You Haven't Enough Money In Your Current Account, What Should You Do?

· Can you transfer money from your Savings Account (if any) into your Current Account?

• Unfortunately, if you have no way of topping up your Debit Card – you will just have to do
  without whatever it is your heart desires and put your Debit Card away for another day

In Part Two we will discuss the Various Credit Cards and which one is best for you.