Illustration by Zara Picken

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Getting Started

I remember the exact time and place where I got my first credit card. It was after university, when I got my first full-time job and as soon as I got my first pay-check I went to the bank branch to apply for a credit card. I always knew it was part of “adulting” and building a good credit score. If anything, I was probably a bit late. At the same time, having a credit card is a responsibility and I was really confused and concerned as to why I was given such a high credit limit. It was well above my monthly salary. That felt intimidating. In some ways, using a credit card well is an exercise in prudence, which is why using it well shows banks and lenders that you are trustworthy and low-risk to be given a loan. This will be very important when you try to take out your first loan, mortgage, car financing or a small business loan. 

Getting started with credit is important, not only to build your credit score for when you want to take your first loan or mortgage, but also to teach you about being financially prudent and in-control of your finances. 

Why get a credit card

• Building your credit score for the future
• Coverage for flights and incidents when things get cancelled
• Managing your cash flow. Especially freelancers have variable income and a credit card allows you to pay for things and then cover the balance once your income comes in. This way you can stay out of overdrafts.
• Rewards and benefits from your credit provider. 

For the first-timers

If you’ve never had a credit card before and you just want to learn how it all works, it’s good to start with a 0% credit card, meaning you don’t pay interest on your balance for up to 20 months, depending on the card. These are also a good way to break down a big payment into monthly instalments without paying interest. Some good options are:

• M&S Bank (20 months of interest fee payments)
• Amazon Classic (3 months of no interest, helps with credit building and gives a £20 amazon voucher)

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For the reward seekers

If you’re all about the points and rewards then you want to get an American Express card. They charge vendors slightly higher fees than other providers which is why they can give you the best rewards. In turn, some vendors don’t accept Amex because of this. 

• Amex Preferred Rewards (It has a yearly fee that’s waiver for your first year. Great card if you only keep it for one year)
• British Airways American Express offers a great sign up bonus and many Avios points, especially if you book flights often.
  

For those paying down credit debt

If you find yourself paying down a big credit card debt and your interest payments are big then you should get a balance transfer card. You’ll pay a percentage of the balance to move it over and then pay 0% interest for a number of months. 

• Virgin Money has the lowest balance transfer fee (1.25%) (24 months at 0% interest)
• TSB has an offer to transfer your balance for 0% if you do it within 90 days of getting your card. Good deal!

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For those looking to improve their score

If you have bad credit  and need to improve your score

• Barclaycard Forward
• Aqua Classic

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For the multitaskers

If you’re comfortable with the idea of having more credit than you need and want to start using credit cards for most of your spending in order to maximize on points and rewards, then look at these options:

• Amex Nectar Card for more points when doing grocery shopping or other Nectar partners
• Barclaycard Rewards is great for overseas spending with zero foreign currency fees.

Having more than 1 credit card is not a problem as long as you stay on top of your payments. With Quirk you can connect your different credit accounts and make sure you never miss a payment. 

*Hacks for advanced users*

• Get more than 1 card to increase your credit utilization and spend small amounts in each card. You can also optimize for different spending categories. For example, using a Nectar card for groceries and an Avios for flights. 
• Get promos for new cards. Providers like to incentivize you to get their credit card with more benefits for new users. On some occasions they will waive their yearly fee for the first year. If you set a calendar reminder to cancel the card at the end of the year, then these work great.
• You can pay your taxes with a credit card using Curve. 

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