How does a credit card work
Super Grandmaster Join Date Aug 2005 Location Underberg, KZN Posts 5,107
Originally Posted by Freshy-ZN
You will also be offered a 'budget' facility, this is a predetermined amount that you can use for 'big ticket' purchases (there is usually a minimum amount that you can use the budget facility for.
For each 'budget' purchase you can then select to pay back that amount over a predetermined number of months (usually 6;12 or 24).
This can be a good option
for buying expensive items - just check that your banks interest on the budget facility is less than the interest you will pay the store if you were to buy on HP.
As mentioned before: always pay back the full amount you have spent each month on or before the due date. Do not only pay back the 'minimum fee' that you see on each statement.
A good way to get around the lack of self control that some people have admitted to is to select a credit limit that you know you can blow and pay back completely each month.