To think always clearing a credit card is not typical?

[OneNattyCrab]

I tend to pay my credit card off in full each month so I never pay interest but it’s made me wonder how common that actually is. Given how many people carry credit card balances, it feels like always clearing it might not be the norm.

AIBU?

The vendors who you are buying from get charged a merchant fee of 1.5 % upwards on every transaction - some cards are much more. American Express is much higher, which is one reason lots of smaller places won’t take them (another used to be slow payment to the vendors , but I don’t know if that is still the case).

They also get charged a fee for debit card transactions but much lower - about 0.6 %.

Even without the customer interest fees, credit cards are still a very profitable revenue stream for banks.

Cleared monthly. Only ever couldn’t a few times in my life. It is a very expensive form of credit I feel sorry for people who get trapped relying on it.

It is worth repeating this. Paying the minimum does not decrease your debt. It allows it to grow to unmanageable proportions.

I used to be an analyst for the financial department of a business with a credit card and the majority of our customers paid in full every month. The credit providers prefers interest bearing balances as that's how they make their money. But our client base was a lot older, average age mid-60s and the acceptance criteria for getting the card was pretty strict, quite a few colleagues were declined, so I guess it would be quite different for a provider that takes on everyone.

I try to clear it every month. There was one month last year that I didn't manage to as my cat was sick and I had a huge unexpected vets bill (after maxing insurance). The £70 interest that month was painful considering I'd paid the majority of the bill.

in my twenties, i would use the credit card for travel, always getting a 0% deal and paying it off over a time.

thankfully i'm not in a very privileged position where i can pay it all off each month, but it took decades before i was earning enough to do so.

Or do a balance transfer to another 0% card 🤔

I am 44 and havent had a credit card in over 10 years, and when I did it was usually for a larger purchase where I took out a card with 6/12 months interest free, which I would pay off before I started getting charged interest (or as soon as physically possible) It's nuts to be paying interest on day to day spending!!

It actually has a more positive impact on your credit score to have a small rolling balance. I clear one of mine every month, but never all of them. Following a very massive from which I never fully recovered financially, my credit score is 11 points off perfect doing that.

99% cleared in full. The only time I don’t if when I’ve got a new card with 0% on new purchases. I tend to do that if buying something very expensive and want to space it out a bit, rather than take from
savings. That only tends to be once every few years though.

Cleared fortnightly as that’s when I get paid. We use it to get all our flight points so it’s all regular direct debits etc.

You get more protection on purchases with a credit card than a debit. I always use a credit card for anything significant, such as new phone or holiday.

Cleared every month here as well.

I have a balance on one of mine, but it’s a 0% transfer until next year. If I would have to pay interest I would clear it. I don’t give them a penny of interest

I clear mine every month, but then I use it for payment protection, not credit.

I have separate savings pots for car, holiday expenses etc so I pay using the CC then refund from savings.

I was like your friend when I was in my 20s, and vowed I’d never do it again. I’d pay the minimum payment, because it was all I could afford, and I’d be lucky if £10 would come off the balance. I try to stop myself from looking back and thinking what I could have done with all the money I spent on interest over those years 😫

I always have cleared mine.

Always paid off in full at the end of the month 👍(not sure how the vote options relate to this though )

I'm not paying any interest - I clear mine monthly.

Agree re the options not being clear as the thread title is that clearing a credit card is not typical which I disagree with as most people do clear it but then you said you always clear it which I agree with. For AIBU you need a clear question consistent with the thread header eg AIBU to ( nearly) always clear my credit card each month.

I dont use a credit card, but this has me wondering, if you can afford to pay it off in full every month, why have one in the first place? Genuinely curious

No idea which way I'm supposed to vote but yeah, I pay it off in full every month.

In my case the only reason I have it is that I have stayed in a few hotels that would only take a Credit Card and not a Debit Card. Rarer now a day to come across them though.

Well I have 3 reasons. Many people have given reasons. Perhaps try reading the thread.

I use it for all spending and pay it off each month. I get points, which I use for cinema vouchers, you get insurance and consumer credit protections e.g. I once bought tickets for an event that went bust, and was refunded via the CC company, and it just makes everything easy. E.g I don't keep much money in my current account to maximise interest, but can spend on the creditcard and transfer from savings as necessary when the bill is due, without having to check account balances.

There's also a small benefit in leaving the cash in savings for a bit longer, earning interest - look after the pennies and the pounds look after themselves really is true.