But making the most of the cash you have does require some forward planning.
Savvy shoppers, for example, will already be thinking about those costly Christmas presents, while parents with an eye on the purse strings will be planning for the numerous purchases they will have to make ahead of the next school year – even though the summer holidays are only just beginning.
If you too are keen to plan ahead to avoid financial issues further down the line, a credit card offering 0% on purchases is a great way to spread the cost – and, as the cards can take between four and six weeks to arrive, now is the time to apply.
How do 0% purchase credit cards work?
So-called purchase credit cards offering an initial period at 0% allow you to avoid interest charges altogether on your purchases (currently for up to 16 months).
As long as you pay the balance off in full within the interest-free period, you can therefore buy now and pay in manageable chunks over the coming months at no extra cost.
What’s more, many of the cards in this sector offer cashback or rewards so that you can earn while you spend. And the good news is that there are lots of fantastic deals available at the moment on cards of this kind.
Remember though that they are generally only available to people with high credit scores. If you are unsure whether or not you will qualify, it is therefore worth using the MoneySupermarket Eligibility Checker tool to check
whether or not you are likely to be accepted. That way, you can find the best possible card for you, without blemishing your credit file with rejected applications.
The Tesco Clubcard Credit Card for purchases
The Tesco Clubcard Credit Card for purchases offers a leading 16 months at 0% on purchases, as well as nine months at 0% on balance transfers (subject to a fee of 2.9% of the amount being transferred).
It also comes with enhanced access to the Clubcard rewards points. You will earn five points for every £4 spent in Tesco stores on the card and one point for every £4 spent elsewhere.
Beware, though – you must clear any balance built up on purchases within the 16-month, interest-free period. Otherwise, you will start incurring interest at a representative APR of 16.9% (variable).
The same goes for balance transfers after the initial nine months that the card also offers.
The American Express Platinum Cashback Purchase Card
This card from American Express also offers 16 months interest-free on purchases, as well as a generous 5% cashback for the first three months of purchases (on spend of up to £2,000) if you apply via MoneySupermarket. Cardholders will receive 1.25% cashback thereafter, with double cashback of 2.5% for one month in every year.
You will, however, have to pay the annual fee of £25 to benefit, while the representative APR (including the fee) once the interest-free period is over is a punishing 18.5% (variable).
It is also only available if you have a household income of at least £20,000 a year.
The American Express Express Rewards Credit Card
This American Express card is another option for those seeking a long-term 0% offer, as it too gives new customers an impressive 16 months interest free on purchases.
Other benefits include a £30 voucher that can be redeemed in a wide range of high street and online stores such as Boots and Amazon for those who spend at least £500 a month for the first three months.
Watch out for the representative APR of 19.9% (variable) though, as it could soon wipe out the value of any rewards earned if you fail to clear your balance in full within 16 months.
The M&S Credit Card
The M&S Credit Card offers 15 months at 0% and allows you to collect M&S points on all your spending, making it a good choice for shoppers who like the store.
The rewards are available both before and after the representative APR of 15.9% (variable) comes into effect, but you should try to pay off your balance in full every month once the interest-free period is over.
Halifax Online All In One
Halifax is also offering shoppers taking out its Online All In One card a generous 15 months at 0% on purchases – although the length of the promotional period you are offered will depend on your personal circumstances.
The main benefit of this card is that it also offers 0% on balance transfers for the same length of time.
Unlike the Tesco Clubcard Credit Card described above, borrowers should not therefore be caught out even if they use it for both purposes – hence the name “All In One”.
Halifax current account holders may also qualify for this card even if they would not usually have a good enough credit score to get market leading deals.
Again, however, the representative APR that kicks in after the promotional period –17.9% (variable) – will cost you dear if you fail to clear your debts in full in time.
Please note: Any rates or deals mentioned in this article were available at the time of writing. Click on a highlighted product and apply direct
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