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In the red on Blue Monday

creditcardsBlue Monday - which falls on 15 January this year - is meant to be the most depressing day of the year. There is a pseudo-scientific calculation on this (which wouldn’t stand up to any rigorous scrutiny) but basically it's a combination of bad weather/post-Christmas lows/broken resolutions and a mountain of personal debt.

Personally I had a blue Thursday. I woke up with a massive spot on my chin. Then the fence finally collapsed so I’ve got to shell out for that. HMRC sent through my tax demand which must be paid by the end of the month. And then I got my credit card bill. OK, so it’s not massive in the scheme of things – it’s three figures. But, for me, it' a huge bill. The annoying thing is I’d forgotten about several of the transactions – as well I might, given that they were more than a month ago. By the time I pay the bill by the end of this month those transactions will be eight weeks old. I will pay the bill off in full, either by dipping into savings or through extreme budgeting. But it’s made me resolve to hide the credit card away for at least a couple of months. While I do earn points on the card (it’s a John Lewis Partnership one) I’ve decided that going without those is a small penalty to pay for not having a chunky credit card bill popping through the letterbox.

I guess I could move the balance to one of the many 0% interest balance transfer credit cards that are on offer. At the moment you can get 38 months free of interest from Barclaycard on its Platinum 38 month balance transfer card (catchy name). But here’s why this deal won’t work for me. First of all, there is (as is common) a fee for doing a balance transfer: on this deal, it’s 1.4%. Then I think I’d probably be turned down as I don’t have a salary, although I think my credit rating is good. But actually, the main problem I have with this is that all you’re doing with a balance transfer card is delaying the eventual time you’re going to have to pay the money back. So I’m going to take it on the chin and pay the bill. Then the credit card is getting locked away – in case I use it out of the blue…

See the SMM guide to managing credit cards here.

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Wednesday, 24 April 2019