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How to get confident using a credit card

If you’ve never used credit before, this article will help you become not only comfortable, but confident, using it to your advantage.


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If you’re new to the world of credit, it’s understandable to be a little cautious - especially if you’ve heard horror stories of people getting into trouble with debt. But the reality is, people use credit every day to help them with essential purchases and improving their credit scores. As long as you use it carefully, there’s nothing to be worried about.

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Firstly, know the facts from the myths

One of the reasons you might not feel comfortable using credit is because of the many myths surrounding credit cards and loans.

1. Using a credit card will get you into unmanageable debt

What’s the first word that springs to mind when you think of credit? If it’s ‘debt’, you’re not alone. Debt can be a really helpful tool if you want to spread the cost of big purchases, like a car or sofa, and you don’t have the cash upfront. Handled sensibly, it doesn’t have to be unmanageable, as long as you can afford to pay it back and aren’t paying over the odds on interest.

The trick is to spend within your means and make sure you can afford the repayments before you take out any kind of credit product. As long as you pay your balance on time and in full each month, credit can come in very handy. It’s only when you make the minimum payment - or worse, miss your payments altogether - that debt can begin to spiral, damaging your credit score and finances.

2. Debt is bad for your credit score

Given that some debt is a necessity, such as when you take out a mortgage to buy your home, it makes no sense that debt should automatically wreak havoc on your credit score.

In fact, using a credit card can actually help to improve your credit score, as long as you use it wisely and only borrow what you can afford to repay (more on this later). Using it little and often will prove to lenders that you’re capable of handling credit, making them more likely to lend to you. It’s only when you misuse credit cards that your credit score can take a hit, for example if you miss payments or use too much of your credit limit.

3. Credit is only for people who overspend

Very few people have enough money to buy a property upfront (lucky you if you do). That’s why mortgages were invented, to allow people who don’t have hundreds of thousands of pounds squirrelled away to borrow the money to get on the property ladder.

Similarly, just because you don’t have the cash to pay for your home improvements outright doesn’t mean you can’t afford to pay in instalments. That’s why a lot of people use a credit card or loan to fund expensive purchases - over 60 million people in the UK in 2019, according to these statistics. Repaying your debt in small chunks each month can make it easier to manage your finances than blowing your savings in one go.

4. Credit comes with high interest fees

This isn’t necessarily a myth, but it’s not always true either. While some credit cards and loans carry high interest rates - such as payday loans and store cards - there are plenty of lower rate options too.

One example of a high interest credit card is a 0% card - these offer you zero interest for an initial period, so as long as you repay your balance before the deal ends you won’t owe any money in interest. If you’re unable to repay the whole balance before the deal ends, you can transfer it to a new 0% card to continue borrowing interest-free.

Remember that the higher your credit score, the better the deals you’re likely to be offered. For example, low APR cards are usually reserved for those with good credit scores, as they’re considered by lenders to be less risky borrowers. So it’s worth taking some time to improve your score before applying for credit if you want to access cheaper rates.

Check if you’re eligible for credit cards and loans with low APRs on ClearScore now. We’ll even show you how likely you are to be accepted before you apply.

5. Having too many credit accounts is bad for your credit score

You might think that having multiple credit accounts open will reflect badly on you, but this is far from the truth. In fact, having several credit accounts that have been active for a long time can do great things for your credit score and creditworthiness. This shows lenders that you’re trustworthy and capable of building longstanding relationships with your bank. Just make sure you’re sticking to the 30% credit utilisation rule.

Find a credit product that works for you

Now you know the key facts when it comes to credit, it’s time to think about how to use it to your advantage.

You can usually borrow more with a loan than with a credit card, so they’re ideal if you’re making a big purchase and want to pay it back in equal instalments. Unlike with a credit card, unfortunately you can’t avoid paying interest on a personal loan.

If you’re looking for credit to help spread the cost of purchases or earn rewards on your everyday spending, a credit card might work better for you. There are a number of different options and each one comes with its own unique benefits - from purchase and rewards cards to balance transfer cards - so consider what you’d find most valuable.

Alternatively, you might like our ‘Choose a credit card’ Coaching plan if you’re not sure what the best credit card for you is. Our chatbot will ask you a few quick questions about your needs, and point you in the direction of the card with the most relevant benefits. Give it a go now - it only takes 5 minutes.

Not sure whether a card or loan is best for you? We’ve summarised the key differences in this handy guide to help you find the right option for your needs.

Got your hands on some credit? Now simply use it sensibly

The final piece of the puzzle is learning how to use credit to your advantage. In practice, that means spending within your means and repaying your credit card bill on time each month, or making sure you keep on top of your monthly loan instalments and the interest owed. It’s as simple as that.

If you need a reminder, have a read of our tips for using credit to your advantage and improving your credit score.

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