Getting a credit card may seem daunting and come with a lot of questions or confusion. Having a credit card could be beneficial so it is always worth asking the question. You need to be at least 18 to have a credit card but it is never too late to get one.

The benefits of having a credit card

Building your credit score – Without a credit card you have no credit score and this could affect you when you need a loan or are trying to get a mortgage. Your credit score is what determines if you are responsible and shows potential lenders if you can handle borrowing and repaying money. The earliest you can start building your credit score the better it will be when you need it.

Rewards – Certain credit cards offer various rewards and incentives such as travel points. If you choose a credit card with a travel rewards system this will get you frequent flyer miles over time; discounts on flights, hotels, and better exchange rates. Many credit cards offer discounts or points with certain shops meaning you could get money off each time you do a food shop at Tesco. Finally, some offer a cashback system and you could get a percentage of your spending returned to you in cash.

Security – Credit cards often come with purchase protection allowing you peace of mind if an item arrives faulty or doesn’t come at all, they also cover protection from theft and fraud. Credit cards offer a secure way to make transactions.

First time credit cards

There are so many options out there it’s difficult to know which one you should have. Getting a credit card depends on each individual situation, if you have a low credit score or you don’t have one at all, here are some good options for you;

Barclaycard

With the APR at 33.9% this may seem high, however they offer ways to reduce this. With good management of repayments for the first year they offer a 3% decrease of APR. With this credit card there is a £50-1200 credit limit and a 0% interest rate for the first 3 months. To help you stay on top of your repayments they will send you reminders of when you need to pay it back which is great if you’ve never had a credit card before.

Tesco

The credit limit is £200-1500 meaning you can borrow more money at one time with a Tesco credit card. The APR is 29.4% for a Tesco Credit card. If you use Tesco as your regular shop for food and fuel you will feel the benefits as you can earn Clubcard points on everything you buy. It’s always useful to track your finances and with Tesco they allow you to easily track your credit score and offer ways you can improve it.

Sainsbury’s 

With the lowest APR of the three at 29.4% and offering a reduction over time. You can earn Nectar points when using your credit card possibly saving you money each time you shop. The credit limit is up to £2000, the largest of the three so if you have large purchases you need to make, this may be the one for you, just make sure you pay it back.

When choosing a credit card make sure it suits what you need it for and that you will definitely be able to make the repayments on time.

If you can only make the minimum amount then this may eventually cost you more money in the long run.

What not to do with your credit card

Withdraw cash – there will be a high fee to take out cash with this type of card and so you should always avoid getting cash out with a credit card.

Only paying the minimum repayment – It is tempting to pay off your credit card fees slowly when and as you can but with this comes a high interest fee meaning you are losing money. Pay off as much as you can at a time to feel the benefits later down the line and make sure your focus is paying off the debt so it doesn’t keep building. Paying back small amounts can make it harder to pay off the whole amount in time and could damage your credit score.

Making lots of small purchases – By using your credit card this way means you could lose track of your spending and that small purchase could cost you more at the end of the month if you can’t pay it back. With necessary items it is best to keep that off the credit card to help keep control.

Chasing the rewards – Those rewards are there for a reason, because they get us spending and signing up for the card. It is a dangerous idea to use your credit card in order to receive the bonuses or rewards as you may lose track of your spending and it often takes a lot longer to build up enough points than you think. Often chasing the rewards promised can lead to a lack of control and focus and if you struggle to repay the debt those rewards you could damage your credit score, the bank also has the right to obliterate those reward options at any time if your spending is too out of control.

Use your card wisely and when and if you receive a reward view this as a bonus.

When thinking about getting your first credit card it is important to think about what you would like it for, if you can trust yourself to keep control over your spending and which card would be best for you.