Changing how you use credit cards can 'save you thousands'

By Sarah Engle, Wed 25 Jun 2008 - Published in Credit Cards

By using credit cards wisely you can save thousands of pounds, according to Moneyfacts.co.uk.

Michelle Slade from the website acknowledges that as families disposable incomes have reduced over recent times, many will be reaching for their credit cards so they can pay for a few luxuries over the summer.

However, she says that if people only make minimum repayments each month, Brits could find themselves paying more than twice as much for their purchases.

Ms Slade points out that if you spent Ł3000 on a credit card charging 15.9 per cent APR and only repaid the minimum of 2.5 per cent, you would end up paying interest of Ł2,729.16 and it would take 25 years and two months to repay the debt.

She advises that by simply repaying a small percentage more, customers can save thousands of pounds.

In conclusion, she states: "Paying just the minimum is very tempting, especially at times like these when many families are struggling, but by doing so you will be storing up additional debt for the future."

Research by cahoot has revealed that 82 per cent of regular online bankers say that internet banking has made them better at managing their finances.

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