Update 08/04/2020: House of Fraser is in administration and is no longer accepting credit card applications.

There are many people who use the House of Fraser Credit Card for emergency purposes, which may include a vehicle breakdown or urgent repairs to the home. It can be a life saver if you don’t have the funds available to deal with unexpected emergencies.

Some people use their House of Fraser Credit Card for their day to day purchases, such as clothes, holidays etc, and just pay the balance at the end of the month, when the payment is due. A credit card can be safer and more convenient than carrying cash around, and most places accept credit cards for payment these days.

Throughout this article, we will look more closely at credit cards and provide more information on:

  • Some reasons why you may want to consider taking out a credit card
  • The pros and cons of taking out a credit card
  • Alternative options to a credit card
  • Tips on how to manage your credit card properly and ensure you don’t end up in a difficult financial situation

Who are House of Fraser House Credit?

House of Fraser offered a credit card to customers in the UK that also offered various rewards, including loyalty points when shopping at one of their stores. House of Fraser was founded more than 150 years ago and was bought by Mike Ashley’s Sports Direct International (SDI) in 2018.

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Struggling to budget

There are many young people who emerge from education and want to find independence.

The salary they earn has to cover their rent, council tax, and other essential bills. They may also have a car to pay for on top of this, and money can often be tight, especially for young people on lower salaries.

This situation can make the House of Fraser Credit Card very tempting, and although it can be difficult to think about having to pay it off, it is important that you always keep in mind that the bill will land at the end of the month.

You may end up overspending

If you are notoriously bad at curbing your spending habits, and there is the risk that you could overspend, a credit card could cause you to end up facing financial difficulties.

What if your salary doesn’t cover your credit card balance

The best way to use your credit card is to make sure you use it, but also clear if off when the payments are due at the end of the month. It is only in using the card and clearing the balance, that you will build your credit score using the House of Fraser Credit Card.

It can work well if you are able to pay off your credit card bill each month from your pay-slip, but it is important that your salary will cover the balance.

Don’t forget House of Fraser Credit Card interest

You should always keep in mind that if you do not clear the balance of your House of Fraser Credit Card each month, you will end up having to pay extra with the interest which will be due.

Avoid getting into debt with the House of Fraser Credit Card

When you take out the House of Fraser Credit Card, you should be focusing on managing it well and using it to improve your credit score. If you have a good credit score, you will have far more access to credit lines whenever you need them. For instance, if you want to get a mortgage in the future, or take out a loan. If your credit score is low, it will be difficult to get access to credit.

The credit score is not just down to one factor, it is a combination of many, and mainly how you manage your credit. Your credit history or lack of, will have a bearing on your credit score.

If you want to do some home improvements in the future, or get a holiday abroad, you may need access to credit to be able to enjoy these lovely things! The only way to improve your credit score is to ensure you manage it well.

These are some ways you can ensure you manage the credit card well and avoid getting into a situation where your debt problems end up getting worse.

  • One card max – do not take out any more than one credit card – you really don’t need it. One is enough and if you manage it well, you will always have credit available on it to spend.
  • Clear the balance – the most effective way to ensure you keep a good credit history is to clear off the balance of your House of Fraser Credit Card when it is due. This will give other lenders confidence that you are able to manage your finances well.
  • Ignore the freebies – freebies are great, but they shouldn’t be the primary reason for taking out a credit card.
  • Don’t max it – you shouldn’t just use all of your available credit because it is there, as tempting as it may be.

Choosing another option to the House of Fraser Credit Card

There are other options to a credit card. There is the option of using a ‘prepaid credit card.’ With this, you will be able to build up your credit score, and you can’t spend what you don’t have, so you need to load it up with money before you can spend anything. There is less risk involved with a prepaid card.

Further information on Prepaid credit cards

With a prepaid credit card, you put funds onto the card, and then spend them at your leisure. These can be used in the same places as you would use credit cards, so you don’t need to worry about trying to track somewhere down to use your card.

The benefits of these cards:

  • Ideal for those who don’t have a credit history and can’t get access to credit cards
  • Help you stick to a budget
  • Small and compact, making them easier to carry around with you
  • Less risky than carrying cash
  • You can keep track of your spending

If anything happens to your prepaid card, you can cancel it straight away. This makes it a much safer option than using cash.

What about a debit card?

Everyone with a bank account has a debit card, and you can basically use this anywhere that accepts card. As with the prepaid card, you need to have funds in your account before you can spend anything, so there is less risk involved.

If you don’t want to take out a credit card, as you are concerned about how you will manage it, using your debit card is a great alternative. It can help you to budget and reduce the risk of overspending. If you don’t have it, you can’t spend it.

How do you improve your credit score without a credit card?

You don’t actually need to have a credit card, especially if your main objective is to improve your credit score. Of course, it can be great in an emergency and it is always handy to have one, but it is definitely not a necessity. If you have bills in your name, you can build up your score by simply keeping on top of these. If you pay these on time when the bill is due, you will find that your credit score will continue to improve.

References

CONC 13.1 Application

CONC 2.1 Application

CONC 5.2A Creditworthiness assessment

About the author

Scott Nelson

Scott Nelson is a financial services expert, with over 10 years’ experience in the industry, including 6 years in FCA regulated companies. Read more
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