The people behind the Saga Platinum Credit Card conducted research in September last year, which showed that over-fifties might be paying more than they have to on their credit cards. Find out about the credit trends for people in this group, the types of cards that are available, and how you can use your credit card wisely and avoid financial traps.

Credit card trends and issues for the fifty-plus age group
According to the results of the study by Saga, at least 6 million of the UK’s 21 million people in this age CatID own credit cards. The problem with this, however, is that many people continue using cards that do not make the best financial sense in their situation.

One third of the credit card owners of this generation automatically get a credit card associated with their current bank – perhaps for the sake of ease, or even due to loyalty. Unfortunately, without weighing up the benefits that they could get from other banks or credit companies, these customers often end up paying more than they really have to.

Some credit cards are appealing or cheap because they offer an initial period without interest. This sounds clever, but the issue here is that a third of the UK’s over-fifties take out these cards but then don’t cancel them when the interest-free term has ended. Some find it too difficult or complicated to make a change at this point, and others remain blissfully unaware that they have started paying interest or fees. In some cases, people end up paying a serious amount before they realise what has happened.

Credit card rewards
One way of attracting customers to a certain type of credit card is the popular system of offering rewards. Depending on how much money is spent on the card, the customer gains points which build up until they have enough to claim a reward. 27% of those in the fifty-plus group like to choose credit cards depending on the free things they will get from using them.

This can be a very useful option, especially for those without much money to buy little extras for themselves. There is a scheme to suit everyone, with air points for those who like to travel, gift or voucher points for people who want to buy items from a catalogue or shop, and cash back points for customers who prefer to be given money.

Several department stores offer their own credit cards, and for many it makes sense to use a store card because the rewards relate to products available in these shops. Sometimes extra points are awarded for not only spending money using the card anywhere, but specifically for spending it in that particular store. If a customer already shops there frequently, then they are likely to gain well from using their store credit card.

Beware of the trap that some fall into, however, of choosing a card with slightly higher rates and a good rewards programme, and then never actually claiming any of the rewards that they become eligible for.

Responsible spending
Of course, credit cards always carry a certain amount of financial risk, but this depends on how well individuals manage their money. If someone’s main motivation behind using credit instead of cash is a reason such as impulsive buying, shopping for things they can’t afford yet, or using credit to gain points and rewards, then they are more likely to end up with an outstanding balance. They therefore have to pay more interest. These payments can add up easily to the point where the customer is paying far more in interest than they are getting in gifts, vouchers or cash back rewards.

Conservative spenders and those who keep an eye on their bank accounts regularly are most likely to fare better. For those who pay their bills on time each month but don’t really keep an eye on the big picture, a regular card with a low interest rate could suit them quite well. This would avoid the risk of enjoying a period without interest, then forgetting all about the interest-free end date and suddenly having to pay an excessive amount of interest.

Rest easy
The last thing that anyone at this time of life needs is to have more stress and worry about money than is necessary. To feel secure about the credit options you choose, be sure to ask as many questions of your bank or credit company as you need to so that you fully understand any hidden costs or increased interest rates.

Check your payments and fees each month, and make sure they are consistent with what you signed up for in the beginning.

Be careful about what you spend. Remember that if you ever have a sudden financial emergency, you will be very glad if you haven’t overloaded your credit card with an amount that will end up being too much to pay back in difficult times.

Sometimes staying with the same bank or credit company is a very secure feeling, but never underestimate the benefit of shopping around. Use the endless benefits of the Internet and its various price comparison websites, and make sure that you find the best card for you in your current situation. There are so many options, and there will be one designed with you in mind.

Sam Jones the author suggests to readers looking to compare credit cards to visit helpful advice pages at uSwitch.


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