Avoid mixing 0% features on the same credit card

As a general rule of thumb, credit card users should be careful not to use a single credit card for both making purchases and transferring a balance, it has been claimed.

While finding a card that allows you to not only make interest free purchases, but also transfer an existing balance and pay no interest for the specified period can prove to be a great help, credit cards should still always be used with caution, it has been reported.

Indeed, while the majority of plastic products are useful for interest free credit cards purchases or 0% credit cards offers, Jane Baker highlights in a lovemoney.com article that those who attempt to use the card for both features may face an unexpected predicament.

The problems caused by using one credit card for both balance transfer and purchases can be substantial, she claims, is especially apparent in the Virgin Credit Card.

Although the card offers the longest interest free balance transfer period currently available on the credit card market, its interest-free period on purchases is slightly less appealing, with only for three months.

And while the Virgin Credit Card sees borrowers receive discounts on goods and services bought from elsewhere within the Virgin Group after the 12-week offer is up, the lovemoney.com writer states that this could cause the borrower to lose out.

Ms Baker said: "If you keep spending on the card once the three months are up, taking advantage of all those juicy discounts, you'll fall into the negative payment hierarchy".

However, it could be possible for borrowers to avoid being hit by negative payment hierarchy should they opt for the Halifax All In One credit card. This, she states, is due to the generous features offered on the card - with 9 months 0% on both purchases and balance.

She highlights that consumers should aim to have all debts associated to the card paid in full before the 0% period expires, otherwise they will find that the typical interest rate of around 15.9% will be apply.

Those on the search for a 0% purchases card were also advised to consider the Tesco Clubcard Credit Card, which she points out will offer interest-free spending for 12 months on the basis that minimum monthly repayments are met.

The Tesco Clubcard was also praised by lovemoney.com writer Serena Cowdy who recently claimed that the 0% balance feature is “perfect for gradually paying back big expenses”.