If you fancy earning yourself a free day out, a couple of flights for a weekend away or even cold hard cash, you should make sure you've picked the right credit card, and we'll show you which ones to choose from, right here!
Although debit cards are officially the UK's favourite method of payment, a large number of us are now turning to our credit cards for everyday purchases.
Of course, this method of payment is only useful if we know that we will pay off our balance in full, each month, as the interest charged by most providers is pretty steep. However, as it's estimated that around half of us do clear our balances each month, credit cards can be a good option. After all, not only can we gain up to 59 days of interest free credit, credit cards can also give us the protection of Section 75 of the Consumer Credit Act, making them the obvious choice for online purchases, in particular.
But did you realise that there are also 'freebies' on offer from a number of credit card providers? How would you fancy your new purchase being protected should you leave it on the bus? Or a free extra year's warranty on that fancy TV you've just bought? Or how about earning yourself a free flight, hotel accommodation, money off your next holiday, or even free days out, simply by collecting loyalty points? And finally, how about the opportunity to earn cold, hard cash?
All of these offers are available; all you need to do is make sure you've got the right piece of plastic in your wallet. And to give you a hand, here are some of the best deals:
Best Cashback Cards (assuming £500 spend/month)
| Provider | Card | % Cashback | APR | Conditions | Cashback |
|---|
Morgan Stanley
Apply via the Fool | Platinum | 1% cashback on first £2k spend,
then 0.5%. | 15.9% | Currently running double
cashback until 1.1.06
(2% on first £2k then
1% until 1.1.06) | ca. £60 |
| Egg | Money | 1% | 6.9% | Account can be charged
up before use.
Max cashback £200 pa | £60 |
American Express
Apply via the Fool | Blue | 2% for 3 months
0.5% on spend up to £2k
1% on spend over £2k | 14.9% | £15 servicing fee if annual spend
is less than £500. Cashback
below £5 will be forfeited. | £52.50 |
| Bank of Ireland | Moneyback | 0.5% on spend up to £2,999 per year
1% on spend between £3k and £20k | 14.9% | None | £45 |
| Leeds BS | Cashback | 1% on spend up to £2k per year.
0.5% on spend over £2k | 16.9% | None | £40 |
In addition to the cashback cards, there are a number of other loyalty cards available. American Express, for example, also offers a British Airways (BA) American Express credit card, which rewards ever £1 spent using the card with up to 1.5 BA miles. Use the card to purchase BA flights and the number of miles received doubles, making it ideal if you fly regularly with British Airways.
Other popular cards with loyalty schemes include those from Tesco and Sainsbury's, offering Clubcard and Nectar points, respectively. It's worth noting that with these schemes that although you can use the points accrued to save money on your shopping bill, it usually works out to be better value to redeem them for special deals such as tickets for days out, restaurant vouchers or even holidays.
And note: new Sainsbury's credit card holders will no longer be given the option to earn either Nectar points/cashback. Barclaycard holders too can no longer earn Nectar points. If you do wish to earn points through a credit card, American Express will be launching its Nectar card later this week.
And finally, cards such as those offered by the Nationwide BS provide the valuable benefit of allowing users to apply for an extra year's warranty on any electrical item purchased with the card. Plus, its purchase protection cover will protect your items costing £50 or more against loss, theft or damage.
So, if you always pay off your balance in full each month, make sure you're getting the best deal you can and snap up a credit card that rewards you for spending!
Find a better credit card and search for one to suit you in our Credit Card Centre.
