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Worth getting a credit card just to improve credit rating? watch


    (Original post by Wookie42)
    As the title reads, I heard someone talk about this yesterday - he has a credit card which he buys only a few things with (expensive, one off items like a new TV or whatever). He claims its because it will help him build a better credit rating or something as he's only 18. I'm sure I've heard this before, but as the extent of my knowledge when it comes to finance is what a debit card is I have no idea.

    Any thoughts? Is it worth getting a credit card just to do this?
    Yes it is, PROVIDING you can be in control of what you spend

    I had exactly the same thing when I got my first job. I wanted to get a mobile phone contract, with no credit rating at all all of the companies rejected me.

    I then went to my bank, got a credit card with £500 limit. Every month spent about £50 on it, paying the £50 off in full each month. Now, a year on, I can say it has worked a treat.

    But ONLY, ONLY, if you can control what you will spend. There is no point in getting a credit card for this reason, then max'ing it out to a point where you can't afford it - you would then have a terrible rating, having virtually taken 2 steps back!

    I got a credit card in about November and basically use it like I did my debit card. I'm 100% sure I have the money in my bank when I make a purchase and have a direct debit to pay off the full amount each month.

    It's Capital One and the interest rate is like 35%, so that's enough of a motivator not to overspend!

    My credit rating is slowly improving, Barclays have also offered me now a £100 overdraft if I were to open a bank account with them.

    It's worth doing ONLY IF you won't use your credit card like a credit card. Only use it to spend money you already have.

    (Original post by callum9999)
    So simply getting a credit card, and not using it at all, will not improve your credit rating? I was considering getting one, but I'm not too sure.

    (Original post by addylad)
    So simply getting a credit card, and not using it at all, will not improve your credit rating? I was considering getting one, but I'm not too sure.
    It probably wouldn't help much. Depending on how they do it, on the credit report it's likely to be marked as not used.

    If that was your plan you could just buy a chocolate bar etc. on it every month. I'm not sure if it would help hugely (a running balance is posted but I'm not sure if they really check it), but it would give you a history of making on-time payments which can only be good.
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