It’s probably fair to say that because of the fallout from the recent recession, credit cards have lost a little bit of their sparkle. The reputation of credit has taken something of a beating over the past couple of years, but there are still some very good reasons it’s a great idea to use credit cards. As long as they are used responsibly and you make sure to take good care of your finances, a credit card can be a very useful tool to have. We take you through some of the responsible uses your credit card can help you with.
One thing credit cards are good at is helping you improve your credit rating. They give you the opportunity to prove that you are responsible with money and that you can handle credit, which then reflects well on your record. If you are hoping to build your credit rating by using your credit card, make sure you make at least your minimum payment each month so you keep on top of things. This then stands you in good stead for the future, when you might want to apply for a great credit limit or alternative financial products.
You can also put your credit cards to responsible good use by taking advantage of any 0% credit card offers available to you. Most often, these offers are available when you apply for a new credit card and give you a few months during which you won’t have to pay any interest on your purchases, as long as you pay off the balance before the deal runs out. If you are looking to spread the cost of several payments, this can be a great way of doing it. Make sure you have the money available to pay off your credit card as soon as possible so you don’t have to worry about paying interest later on.
Credit cards with 0% interest are not just a good deal; they can also help you manage your finances, so this is another responsible use for your card. Another sensible credit card use is for making regular payments: this way, you can always be sure that your payments will be made on time and that you will always have the money available to meet them as long as you are careful not to go over your credit limit. The benefit of using a credit card for regular payments is that it covers you in the event of unexpected circumstances: for example, if you get paid late one month, your bills will still be due on the same date. A credit card makes sure you have the money available when you need it and then you can just pay off the balance when you get your next statement.
Of course, it isn’t just you as the consumer who needs to be responsible with credit cards: credit card providers such as Virgin Money do, too. This is why the application process is so careful and comprehensive. It’s not about intruding into your life, it’s about being a responsible lender and making sure you have the means to fund your credit card. This is why credit limits exist; they mean that there is a massively reduced risk of problems as you’re much more likely to be able to cover the cost of your card.
Being a responsible lender also means knowing when to take the difficult decision and turn down someone’s request for a card. Of course, the aim is always to give people a credit card at a rate they can afford and with the best deals possible, but part of rebuilding credit’s reputation is about knowing when to take that step back.
There are also ethical benefits to credit cards: Virgin Money, for example, has a charity card that helps customers give something back and support their favourite causes every time they use their credit card. This is about recognising our collective responsibility to the wider world around us and taking steps to ensure that everything we do is fair, right and just, and not just about profit margin.
So, if you have ever been worried about using your credit card or wanted a more ethical product to give you peace of mind, this is something that is increasingly available to you. There is a greater understanding – on both sides – of the responsibility involved in having a credit card and more options to allow you to give something back when you use yours. Credit cards can be a positive, useful thing: let’s make sure we keep them that way.