Budget for holiday spending with 0% credit cards
By UK CreditCards.com
Use of 0% credit cards can form a key part of festive spending strategies, a financial expert suggests.
Paul Lewis, a personal finance journalist and presenter of the BBC's Moneybox programme, suggested that shoppers can spread the cost of their Christmas expenditure by using credit cards with interest-free purchase periods.
Writing for Community Card, Mr Lewis said that applicants can take out a 0% credit card to fund their festive expenditure alone. They can then divide their balances by the amount of months that charge no interest on purchases when they plan their repayments.
Therefore, if a customer spends £900 on the card and the 0% period lasts for six months, then payments of only £150 a month are enough to wipe out the balance without any interest being charged. However, Mr Lewis also said that shoppers planning to use this strategy need to be disciplined.
"Do not use [the credit card] for day-to-day spending -- or treats for you," he advised.
Published: 26 October 2009
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