Debt Is So Underrated

For us rich kids without money.

Credit Cards Archives

I looked on the online statement for my credit card the other day to find four transactions from Auto Trader's website. Which is interesting as I've never used that website.

Two of them were charges and two were refunds so I don't know what was going on there. But anyway, I've had my credit card company cancel my card.

So, the credit card companies collected the money and now my overdraft is once again maxed out :p.

Actually, I still have quite a bit of money in it but I need that to pay off the money I've since spent again on my credit card. Role on pay day!

Credit scoring is what banks use to estimate whether you are going to pay them back or just bum around with their money.

But it's a weird system. I went down to move my student account to Halifax from HSBC the other way. Not open a NEW account but simply MOVE an existing account.

They turned me down because my credit score wasn't good enough.

Meanwhile, at the same time, Lloyds TSB were approving me for a credit card with a £1,000 limit! Twice what they will normally give you.

Could somebody please explain this to me? The banks can't - Halifax said at the branch they didn't get any information on why I had been turned down as there was nothing negative on my credit report.

They told me to phone the main call centre up who informed me if I had failed the credit check then that was that nor did they seem to like the suggestion that there was nothing negative on my credit report (there isn't, I've checked, it's perfect).

Credit card companies often brag about the fact they will give you 2 months interest free credit on spending on you card.

This isn't a good thing though!

I'm getting way to close to maxing out my credit limit because they give me so much time to pay that they don't take the money out of my bank account to pay off my card fast enough.

Is it less painful to pay with a credit card than wish cash? Well, probably yeah. And also when you have to get the cash out, it's just a world of pain. Credit cards make it so much easier.

But does that mean you spend more on your credit card? Probably not. Because you've already decided to buy the products when you hand over either cash or credit cards. And it's not like you have flashbacks to getting cash out when deciding to buy something (well, for most of us, a few of you crazy people might :p).

I had a thought today. I was making a payment from my debit card to my credit card as I need all my money in one place so I move it all onto my credit card to pay my accommodation bill.

When I pay it, I will get cash back on my credit card.

But surely the transfer I made to my credit card from my debit card is a payment as it was described as a "debit card payment."

So if I can make a credit card payment in the same way I could potentially use another cash back credit card.

So what is to stop me just making payments from one card to another and back again using the same money each time and earning loads of cash back? I'd be interested to know if there is something preventing that, both in reality and in the terms and conditions of your credit card.

One thing I think is often overlooked about credit cards even though it's usually considered with any other kind of money lending is that your money stays in your account for longer so you earn extra interest.

While this isn't a massive benefit because it's a current account, it's not without it's advantages. I'm spending about £200 a month on my credit card. So on average I have a balance of about £150 on it. And that is just me, someone who has no money.

Think about how much you spend on your card. I know my parents spend way more than that, it's certainly in the thousands, maybe even tens of thousands per year. That is going to give them a high average balance.

Now given most credit cards give you a nice interest free credit period that's plenty of time to earn interest on that money. Especially if you have a savings account and electronic fund transfer it into your current account once a month to pay the credit card bill.

Why did I sign up for text alerts? I mean seriously, why do I want Egg to text me every week telling me what silly amount of money I have spent on my credit card?

• Greetings! I'm Chris and this is my blog about debt, finance and generally having no money. Luckily as a student, it's just expected of me to have no money so it's all good.

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