What`s the best use for a credit card?

11 October2010

Find a credit card

Credit cards have more benefits - and uses - than you may realise. We`re all well aware that they can be used to spend money - but did you know they also offer more protection than other ways of spending, and some can even make repaying debt easier?

With so many different uses, there`s really no single `best` way to use a credit card. It depends on what you want to do with your money.

Review our latest credit card best-buys

Product	Transfer rate & period	New Purchases rate & period	Representative APR
NatWest YourPoints World MasterCard Special Offer	- - 0% Fee	0% 18 mths	17.9% (variable)
	Representative example: With this credit card the representative APR is 17.9% (variable) based on an interest rate of 17.95% (variable), transfer fees of 0% and a credit limit of £1200.
Royal Bank of Scotland YourPoints World MasterCard Special Offer	- - 0% Fee	0% 18 mths	17.9% (variable)
	Representative example: With this credit card the representative APR is 17.9% (variable) based on an interest rate of 17.95% (variable), transfer fees of 0% and a credit limit of £1200.
M&S Credit Card	- - -	0% 15 mths	15.9% (variable)
	Representative example: With this credit card the representative APR is 15.9% (variable) based on an interest rate of 15.9% (variable), and a credit limit of £1200.
Halifax All In One	0% 15 mths 3% Fee	0% 15 mths	17.9% (variable)
	Representative example: With this credit card the representative APR is 17.9% (variable) based on an interest rate of 17.95% (variable), transfer fees of 3% and a credit limit of £1200.
Barclaycard Platinum with Purchase	0% 15 mths 2.9% Fee	0% 15 mths	18.9% (variable)
	Representative example: With this credit card the representative APR is 18.9% (variable) based on an interest rate of 18.9% (variable), transfer fees of 2.9% and a credit limit of £1200.
Virgin Credit Card	0% 13 mths 2.89% Fee	0% 13 mths	18.9% (variable)
	Representative example: With this credit card the representative APR is 18.9% (variable) based on an interest rate of 18.9% (variable), transfer fees of 2.89% and a credit limit of £1200.
Sainsbury's Credit Card	0% 12 mths 3% Fee	0% 12 mths	16.9% (variable)
	Representative example: With this credit card the representative APR is 16.9% (variable) based on an interest rate of 16.94% (variable), transfer fees of 3% and a credit limit of £1200.
Bank of Scotland All In One	0% 12 mths 3% Fee	0% 12 mths	17.9% (variable)
	Representative example: With this credit card the representative APR is 17.9% (variable) based on an interest rate of 17.95% (variable), transfer fees of 3% and a credit limit of £1200.
We provide a representative range of products on competitive terms and do not act exclusively for any credit provider. Credit limits may vary depending on your circumstances.

Credit cards for day-to-day purchases

Some people would advise you against making general day-to-day purchases on a credit card, often for the simple reason that it`s not really worth getting into debt to pay for smaller items. However, as long as you are certain that you`ll be able to repay what you owe in good time - preferably before you`re charged any interest at all - using your credit card can be a convenient way of making smaller purchases.

This is particularly true if you`re the holder of a cashback credit card (or a card that offers other rewards on your purchases), because each purchase you make will earn you money back - effectively cutting the price of everything you buy.

Credit cards for `big ticket` purchases

Making bigger purchases can deliver the same benefits as making smaller purchases if you have a cashback credit card, but for items over £100 (but under £30,000) it could also be a matter of protecting your finances. Credit cards basically protect you against making purchases which are never received or don`t meet reasonable expectations - so you could save yourself a lot of trouble by paying for expensive items on your credit card.

Just remember that this debt does need to repaid, and so you will need to be able to repay what you owe in good time - or risk paying more in interest than you`d expected. You can make sure you have a longer repayment period (without being charged interest) by finding a 0% purchase credit card, which won`t charge any interest for a limited period on purchases made using that card.

Credit cards for repaying debt

Credit cards aren`t just for buying stuff - some cards can also make repaying your debts cheaper and easier. A 0% balance transfer card enables you to shift across debts from other cards without paying interest for a certain time (although you will usually face a balance transfer fee of around 3% of the total balance).

Paying no interest can allow you to repay more of your debt in a shorter space of time. But remember: the interest-free period is time-limited, so to avoid paying interest, you`ll need to clear your debt before that time or switch to a similar deal at the end of the period.

Compare the best 0% interest credit card deals with our useful credit card comparison tool.

Tags: credit cards, best, best use, rewards, debt, purchases, deals, credit card deals