I’ve never had a good credit rating, making many unwise decision in my first few years of adulthood. I have a default as part of an employment dispute (thats a story for another day) but thats the only negative on there now. If I’m being frank, I have no immediate need for credit but I’m sure I will want a mortgage eventually. The primary motivation for this post is that I am considering applying for a credit card with some actual benefits and would like to review my habits and whether I should bother.
In 2014, I was lucky enough to be offered a Aqua basic credit card. This was surprising because I even get turned down for run-of-the-mill phone contracts or store credit (not that I am a frequent applier, maybe once a year at most).
The rate increased from 250 to 2850 over the lifetime of the card, as I have always made full balance payments on time, every month. However (and I know that the “Credit Score” from the reference agencies are meaningless to potential lenders) I have never seen any particular positive change to my credit report. For all that I’ve read, it seems credit cards are the only viable way to improve credit for us mere peasents.
So, I’m wondering if I am not seeing the credit rating benefit of using a card due to how I use it:
When I haven’t got cash I use the card for all purchases – online, in shops etc – and a couple of monthly subscriptions. I don’t use cash much at all so this is frequent use. I use it for all big purchases so some months I may have a statement of £200, and some months it may be much higher (it was close to the limit this month for the first time in a while) but the statement is always, without fail, paid off in full. I do not use it to withdraw cash or gamble (I did use it once, way back in 2014, and learnt my lesson – thats the only time I have ever paid interest on it).
Is this the wrong away to use my credit card?