Credit cards turn 50: Four top deals to meet any need

The credit card turned 50 years old last week. Barclaycard launched back in 1966 and now 31 million of us own a credit card and collectively put £15bn a month on our plastic.

Whether you use your credit card to spread the cost of big items, reduce the cost of your debt or simply to build up rewards that little piece of plastic has changed the way we shop. At the moment there are some fantastic credit card deals available. Here’s a round-up of the best.

1. The best for existing debts

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If you’ve got a lot of debt sitting on credit cards then consider moving it to a balance transfer card. You’ll pay a small fee for the transfer and can then enjoy an interest-free period that can last years. If your debt is no longer growing then that means you should be able to pay if off faster without handing over unnecessary interest payments.

Halifax offers a 40-month balance transfer card, giving you over three years to clear your debt. It comes with a 2.49 per cent balance transfer fee.

If you don’t need that long to clear your debt look for a card with a shorter balance transfer deal and a lower fee. For example, Post Office Money has a balance transfer card that is interest free for 22 months and has no fee at all.

Just make sure you clear the debt before the interest-free period ends as the interest rate will then jump up to around 20 per cent, typically.

2. The best for new purchases

Do you need to make a big purchase such as a holiday or appliance? Spread the cost for free with a zero per cent purchase credit card. Sainsbury’s Bank offers zero per cent on purchases for 27 months. Again, make sure you clear the debt before the deal runs out as the interest rate leaps to 18.9 per cent APR after that.

3. The best for travel spending

If you are heading abroad this summer choose your plastic wisely as some charge hefty fees when you use them abroad. For example, take a HSBC credit card abroad and you will pay a non-sterling transaction fee of 2.75 per cent every time you use it. Withdraw cash and you’ll pay that fee plus a two per cent withdrawal charge.

With the exchange rate so poor the last thing you need is to pay almost a five per cent premium to use your card.

Instead take the Halifax Clarity card which has no foreign usage fees even if you withdraw cash on it. Just be aware that interest is charged at 18.95 per cent APR on cash withdrawals from the moment you take the cash so stick to paying with the card instead.

4. The best for cashback

Anyone who clears their credit card balance in full each month should consider getting a reward card. These accrue points, cashback or airmiles when you spend on them. The best cashback rate is offered by American Express’ Platinum card. It pays five per cent cashback for the first three months, then 1.25 per cent thereafter.