How to Use a 0% Purchase Credit Card
0% Purchase Best Buys
0% Purchase FAQ's
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0% purchase credit cards allow you to buy now and pay back gradually over a period of up to 12 months - without the worry of interest charges.
0% purchase credit cards can be used to help lighten the initial cost of splashing out on large purchases now and also continuous spending throughout the 0% purchase period.
The following guide will help to explain how best to use a 0% purchase credit card, including how to make the most out of the 0% offer and the things you should be aware of.
Make the most of your card...
- Spend sooner rather than later
If you are taking out a 0% purchase credit card for the purpose of buying a large or several large items now, maybe a new laptop or a new kitchen, it's a good idea to take the card out just before you need to make your purchase.
0% purchase periods run from the day you open the card account, and not from the date of your first purchase, so the sooner you spend the longer you'll have to repay the purchase at 0% interest.
- Repay as much as you can comfortably afford to
Whether you are going to spend on a 0% purchase credit card now, or over the coming months, it's important to repay as much as you can comfortably afford to each month.
You don't need to rush, but you should aim to repay your spending before the end of 0% purchase period.
- Clear your spending before the end of the 0% period
Budget your income and work out a set amount that you will repay each month and try to stick to it - or repay more.
It's a good idea to try to repay your 0% purchase credit card spending before the end of the introductory period.
Any purchase balance remaining on your credit card once the introductory period has ended will become subject to the card's standard interest rate, which is on average around 15.9% p.a.
By making sure to repay your spending before the 0% period ends will mean your use of a 0% purchase credit card remained free - which, is probably what you intended when you took one out.
Things to watch out for...
- Cash transactions
Cash transactions are a big no no when it comes to any 0% credit card.
0% offers will never include cash transactions, and aside from carrying high interest rates and handling fees, any cash transactions made on a 0% card will become trapped behind any cheaper balances, and only when all your 0% debt is fully repaid will you be able to pay back any cash transactions.
Remember to use your debit card for any cash transaction you may need to make, including withdrawing cash at an ATM machine, getting 'cash back' at the supermarket, buying foreign currency or traveller's cheques or gambling transactions - including buying food or drink at a gambling establishment.
- Balance transfers
Certain 0% purchase credit cards are also suitable for transferring a balance to.
If you are intending on shifting a current outstanding credit card balance to your new 0% purchase credit card make sure that the card you choose offers a 0% deal on both purchases and balance transfers, and that the 0% deals last for same duration of time.
0% credit cards offering 0% balance transfers with a shorter 0% purchase period should be avoided when using the card for both types of transaction.
This is because, similarly to cash transactions, once the shorter 0% purchase period ends any outstanding purchases will become a higher rate balance than your 0% balance transfer, and will therefore become trapped behind your balance transfer, accruing interest charges until you have first repaid all your cheaper debt.
See 0% credit cards suitable for both purchases and balance transfers here.
Alternatively, to get the best of both worlds, you may want to consider taking out a seperate 0% balance transfer credit card for managing your existing credit card balances.
- When the standard interest rate kicks in
Be aware of when the 0% purchase period is going to end and try to repay your spending before the standard interest rate kicks in.
The standard interest rate can be fairly high and any leftover spending will incur interest charges after the 0% period ends.
- Don't miss a payment! And don't exceed your credit limit!
As with any credit card deal the card issuer will always put certain terms and conditions in place to look after their cash.
If you are late or miss a payment on your 0% purchase credit card, or if you exceed your credit limit the card issuer is likely to remove your 0% deal pretty promptly.
Keep your 0% offer safe and always make sure to pay at least the minimum payment each month and don't exceed your credit limit.
Compare 0% purchase credit cards
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