Credit Card Advice needed

I'm cancelling my BarclayCard and taking out a Santander Zero Card as the Santander Zero card has no foreign exchange loading anywhere, so you get the best possible exchange rate, and uniquely it doesn't charge a fee for withdrawing cash.

http://www.moneysavingexpert.com/travel/cheap-travel-money#topcards

Does anyone have any experience of using credit cards abroad and if so will I get a better exchange rate by using it than by changing real money in the UK or abroad?

I've applied to transfer my £400 balance from the BarclayCard over to the Santander Zero, but i'm a bit confused by this comment: This card also has a decent balance transfer offer; 0% for twelve months with a 3% fee. However, if you're using it for spending abroad, don't do a balance transfer too, as this can end up costing you big. When they say it can cost you big does this mean if the card stays in the red? I'll be loading the card with money before I use it abroad (so using it more as a debit card) so does this mean i'll be ok?

These might seem stupid questions but i'm very wary of credit cards as the devil is always in the detail.

I'm cancelling my BarclayCard and taking out a Santander Zero Card as the Santander Zero card has no foreign exchange loading anywhere, so you get the best possible exchange rate, and uniquely it doesn't charge a fee for withdrawing cash.

 

http://www.moneysavingexpert.com/travel/cheap-travel-money#topcards

 

Does anyone have any experience of using credit cards abroad and if so will I get a better exchange rate by using it than by changing real money in the UK or abroad?

 

I've applied to transfer my £400 balance from the BarclayCard over to the Santander Zero, but i'm a bit confused by this comment: This card also has a decent balance transfer offer; 0% for twelve months with a 3% fee. However, if you're using it for spending abroad, don't do a balance transfer too, as this can end up costing you big. When they say it can cost you big does this mean if the card stays in the red? I'll be loading the card with money before I use it abroad (so using it more as a debit card) so does this mean i'll be ok?

 

These might seem stupid questions but i'm very wary of credit cards as the devil is always in the detail.

Normally if you spend anything on a card which you have already transferred a balance onto, then you have to pay off the 'higher' debt of the balance (i.e the new money) before you reduce the amount you'd transferred from Barclaycard.

Any addition to the card on top of your balance transfer amount is charged on the standard rate on the card (unless you can find a 0% BT and 0% spending card - although that would probably only be for 6mths).

HTH.

Normally if you spend anything on a card which you have already transferred a balance onto, then you have to pay off the 'higher' debt of the balance (i.e the new money) before you reduce the amount you'd transferred from Barclaycard.

 

Any addition to the card on top of your balance transfer amount is charged on the standard rate on the card (unless you can find a 0% BT and 0% spending card - although that would probably only be for 6mths).

 

HTH.

I don't know why I decided to transfer the balance over tbh because i'll be paying if off before the end of June, so before I use the Santander Zero it'll be paid off in full and in the black (enough to cover potential car hire costs + more if I find that it's an economic method of spending) as i'm only going to be using it on holiday.

The 0% spending is for 3 months on the Santander Zero, but as I say the 18.9% interest rate doesn't bother me as it'll be just to use abroad and as soon as I get the card i'll register it online and do a credit limit decrease (should it let me) to about £500 anyway.

Do you know whether in lieu of 0% foreign exchange fee it'd be more economic to use the credit card as a debit card rather than taking cash sterling and hunting for a local exchange in the resort (these usually give a better rate than banks in the UK i've found)?

Difficult to say..but if you went into a foreign exchange and used the card to withdraw cash, you would probably been looking at a cash advance charge - worth checking.

Alternatively, using it in shops/restaurants etc wouldn't incur this.

I wouldn't balance transfer if you are paying it off in June. The 3% transfer fee will be more than your 1.5% (approx) monthly interest charge with Barclaycard. Even if you don't pay it off until the end of July, you still break even by not transferring.

If you plan to run the balance for 3+ months, then it might make sense to transfer. I know we're only talking about £5 or £10 here, but I wouldn't want to give the feckers any more than I have to.

Normally if you spend anything on a card which you have already transferred a balance onto, then you have to pay off the 'higher' debt of the balance (i.e the new money) before you reduce the amount you'd transferred from Barclaycard.

 

Any addition to the card on top of your balance transfer amount is charged on the standard rate on the card (unless you can find a 0% BT and 0% spending card - although that would probably only be for 6mths).

 

HTH.

I think it is the other way round - i.e. the money you spend on a card to which you have already transferred a balance "sits" at the bottom of the pile, as it were, gathering interest whilst you chip away at paying back the money you transferred from another card. Any purchases will be repaid last. This is how they make their money.

I'm inclined to go with johnny Bognor firstly, no point in doing the transfer really, if you weren't paying it off in full anyway you'd end up paying off the purchases last. As you are loading the card up of course none of the interest stuff applies and as there's no fees your good to with that card just using it for normal purchases, no need to withdraw cash.

I wouldn't balance transfer if you are paying it off in June. The 3% transfer fee will be more than your 1.5% (approx) monthly interest charge with Barclaycard. Even if you don't pay it off until the end of July, you still break even by not transferring.

 

If you plan to run the balance for 3+ months, then it might make sense to transfer. I know we're only talking about £5 or £10 here, but I wouldn't want to give the feckers any more than I have to.

I don't get charged the 3% because i'm an existing Alliance & Leicester customer. The question I really want answering is will I get a better exchange rate by paying for purchases (obviously won't use the card for cash withdrawals) with the card than by changing hard currency?

I don't get charged the 3% because i'm an existing Alliance & Leicester customer. The question I really want answering is will I get a better exchange rate by paying for purchases (obviously won't use the card for cash withdrawals) with the card than by changing hard currency?

yes, by quite a margin. When you buy something abroad on a credit card, the card company bill you at the bank-rate on that day, not the tourist rate, so the transaction that shows on your statement will be a lot less than if you were to change currency and pay in cash.

I have never heard of anyone putting money ON to a credit card. Why don't you just leave the money in the bank and use that card?

yes, by quite a margin. When you buy something abroad on a credit card, the card company bill you at the bank-rate on that day, not the tourist rate, so the transaction that shows on your statement will be a lot less than if you were to change currency and pay in cash.

Cheers, in that case i'll do what I usually do and take a wad of £10 notes, but you do need to use a credit card if you hire a car abroad if you if you pay in advance. That said this may have changed because i notice that holidayautos (the company i always use) now take payment for windscreen/tyre/undercarriage cover in advance. The ammount they're asking seems a little excessive @ £80, but paying in advance saves the hassle at the desk.

I have never heard of anyone putting money ON to a credit card. Why don't you just leave the money in the bank and use that card?

Because you get hammered* with fee's when you use a debit card abroad. There are no fee's with the santander zero credit card. Cash is still king though according to scotty.

(when i say hammered it's not a huge amount at 2%ish plus a possible usage fee, but it's still prudent to find the best option)

e.g, if you spend £1000 on purchases with you debit card then 2% is £20 down the drain, and some debit card providers charge £1-2 for each transaction so you could easily double that to £40, and then because of the poor rate in comparison to rates you get in resort that wasted money can rise further. I reckon you could be looking at between a £50-£60 rip off all factored in. You could pay for a meal and night out for two for that.

Cash is still king though according to scotty.

 

Think you might have mis-read Scotty. The way I read it, he's recommending using a card which exchanges at the bank rate rather than the lower tourist rate.

I have never heard of anyone putting money ON to a credit card. Why don't you just leave the money in the bank and use that card?

http://www.moneysavingexpert.com/travel/5193398241,70293

Scroll down the page to the debit cards section and you'll see how much your bank rips you off.

Think you might have mis-read Scotty. The way I read it, he's recommending using a card which exchanges at the bank rate rather than the lower tourist rate.

Cheers, i did missread what he said. So the santander zero which offers a 0% foreign exchange fee is the best bet. In that case i'll be loading it with a few quid to spend in "reputeable" establishments.

Cheers, i did missread what he said. So the santander zero which offers a 0% foreign exchange fee is the best bet. In that case i'll be loading it with a few quid to spend in "reputeable" establishments.

Actually the best bet is a Saga Card. But you've got to be an old bastard to get one...

That said this may have changed because i notice that holidayautos (the company i always use) now take payment for windscreen/tyre/undercarriage cover in advance. The ammount they're asking seems a little excessive @ £80, but paying in advance saves the hassle at the desk.

You'd be better off getting an annual insurance for your excess through an independent company: I've used Insurance4carhire. The moneysaving site will probably back this idea up if you want to research it.