0 Credit Cards

0 Credit Cards are those credit cards that charge 0% interest. This is normally an introductory offer to new customers – almost never offered to existing loyal customers. If you are clever and keep an eye on your credit cards – 0 credit cards can be a very cheap way to borrow money. But you have to be careful!

Credit cards are not right for everyone. In any economic environment, you never know what can be round the corner – credit crash, personal illness, losing your job. Going into debt is not always the best plan, even though in recent times, many banks and credit cards companies have made it too easy. However, if you plan your repayments, and know your limits, debt is not necessarily bad.

If you do get into arrears, then the credit cards company can – and do – bite hard. They can take full advantage, in charging high interest rates, and taking you through the courts – so why not take advantage of them!

Loyalty is something we all tend to recognise and treasure. You might have a favourite restaurant, who know you by name when you go in, and treat you like valued customers. They value your custom, and you even value their service – even if there is an evening where things do not go quite as well as usual, you will probably still go there again. That is customer loyalty.

A 0 credit cards company does not operate like normal businesses – they do not recognise customer loyalty and so do not reward it. They only recognise new turnover and new business. This may seem strange to most people, after all, you would think that they would want to keep a customer who has been there for a number of years, but as we all have seen since 2007, the financial institutions do not operate in a normal manner. So, if your credit card company does not reward your loyalty – don’t be loyal.

Do a quick check of the advertisements on the internet, newspapers and on TV, and you will see that they all seem to offer a 0% interest period for NEW customers (i.e. not existing ones). So, look around, and be a new customer!

There is nothing wrong with taking full advantage of the offers from the 0 credit cards offered. However, to get the full advantage, you need to keep a close eye on a few things.

Ensure it is a 0 credit cards offer

Check the small print! Make sure that the credit card you are applying for IS 0%. If you are, or have in the past, been a customer for that company, then the offer may not be open to you. Don’t just assume it will be – check the small print.

Make the Repayments On Time

Purchases made with 0 credit cards still need to be repaid – it is just the borrowing that is 0%. There may be some small print that fines can be imposed, or the 0% offer with drawn if you do not make the proper repayments. This will normally mean at least a minimum each month. Don’t expect the credit card company to point this out to you either – if it’s written in the small print and you haven’t read it – that’s you fault not theirs!

Change 0 Credit Cards Again

When the introductory offer is over, expect a massive jump in interest rates – that’s how they make their money. If you have not paid off the balance, then you should change to another 0 credit cards offer BEFORE the 0% rate ends. It does not take long for the new charges to rack up and eat away at any savings you have made. Don’t worry about being disloyal – that what the credit card companies want you to be.

You need to decide carefully if you want to take full advantage of 0 credit cards offered. There is no doubt that they do offer a cheap method of borrowing. However, like all debt you need to plan knowing your own income and expenditure.

But remember – when was the last time a credit card company rewarded loyalty? If you have a credit card with some outstanding balance, check out some of the offers available - it could save you money.