Charge Cards And Gold Cards

Where from? Specialist card companies such as American Express, Diners Club, banks.

How they work There's no spending limit and you can use the card to pay for goods and services for any amounts. But you must pay off the whole bill each month. There's an annual fee of anything from £40 to £60, and there may be an initial joining fee. Gold cards are 'up-market' charge cards available to people who can show they have high earnings. Points to note Charge cards aren't strictly classed as credit cards because you have to pay off your bill each month. But cardholders may have access to cheap loans, and gold cardholders can get special overdrafts on favourable terms.

Verdict Expensive - only worthwhile if, say, you do a lot of business travelling.

Shop credit schemes

Where from? Many shops.

How they work Shop credit is a way of paying for goods or services in a particular retailer's shops or other outlets. There are several types of scheme:

- shop cards: these are usually like credit cards though the interest rates are usually much higher. Some shop cards work like save and borrow accounts )

- hire purchase, credit sale and conditional sale: with these, the credit offered is tied to the purchase of particular goods. They work rather like a personal loan - generally, the interest rate is fixed and you make regular payments over a specified per>

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Around a half of all cardholders pay off their bills in full each month using their cards as a costless form of 'plastic cheque' - this is particularly useful as most retailers won't accept ordinary cheques without a cheque guarantee card, which may limit your spending to as little as £100 in that way. But for the card companies, this practice is expensive and there are rumblings that a flat fee might be introduced on traditional cards (as has already happened with some of the newer cards) to be paid as well as interest on balances.

Using credit cards to get cash can be expensive. For... see: More On Credit Cards

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