Best credit card for someone on benefits? — Scope | Disability forum
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Best credit card for someone on benefits?

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DoneAndBeyond
DoneAndBeyond Community member Posts: 9 Listener
edited March 2022 in Benefits and financial support
I'm unemployed and am on PIP and ESA. This would be my first credit card so I know a credit-builder one would be best, but what companies are the best? Many thanks!
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  • Ross_Alumni
    Ross_Alumni Scope alumni Posts: 7,652 Disability Gamechanger
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    Hi @DoneAndBeyond

    I hope you are well.

    I have no personal experience in this area, but I'd be interested to hear from other members about whether they have any recommendations or insights to share.
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  • woodbine
    woodbine Community member Posts: 11,749 Disability Gamechanger
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    https://www.moneysupermarket.com/credit-cards/credit-builder/

    There are quite a few "credit builder cards" they all have one thing in common they charge quite high interest rates usually around 39% APR, if you get one the best way to manage it will be to set up a direct debit to pay it off in full every month, then use it to buy something you were going to anyway.
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  • racyguy
    racyguy Community member Posts: 560 Pioneering
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    woodbine said:
    https://www.moneysupermarket.com/credit-cards/credit-builder/

    There are quite a few "credit builder cards" they all have one thing in common they charge quite high interest rates usually around 39% APR, if you get one the best way to manage it will be to set up a direct debit to pay it off in full every month, then use it to buy something you were going to anyway.
    Absolutely. Taking out a credit card whilst on low fixed income be they benefits or SRP can be a recipe for disaster unless you factor in that the debt has to be repaid as you point out.

    Recently heard of a single mum in my area racking up a debt of over £15,000 with an income of £650 a month! No hope in her ever clearing that amount. Personally we have two credit cards - a Barclaycard one with a limit of £8000 but never used for over the last 8 years and a Halifax one with a limit of £11,000 which is used to buy one offs that do not exceed £500. The debt on that card is paid off at the rate of £150 or so a month over 4 months.

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  • Alphabet123
    Alphabet123 Community member Posts: 1 Listener
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    Hi I'm on pip and I'm looking for a credit card. How do I get one? 
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  • bg844
    bg844 Community member Posts: 3,887 Disability Gamechanger
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    https://www.moneysavingexpert.com/eligibility/credit-cards/search/

    This will compare all that are available to you without leaving a negative impact on your score. As others have advised, please do not take up debt you can’t afford.
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  • OverlyAnxious
    OverlyAnxious Community member Posts: 2,653 Disability Gamechanger
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    Someone else's!  ;)

    I've never had a credit card myself.  It's not needed for a good credit rating as some people suggest.
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  • L_Volunteer
    L_Volunteer Community Volunteer Adviser, Scope Member Posts: 7,978 Disability Gamechanger
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    What an insightful thread! Thanks everyone for your contributions  :)
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  • Racertracy
    Racertracy Community member Posts: 1 Listener
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    DoneAndBeyond said:
    I'm unemployed and am on PIP and ESA. This would be my first credit card so I know a credit-builder one would be best, but what companies are the best? Many thanks!
    Racertracy
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  • Cher_Alumni
    Cher_Alumni Scope alumni Posts: 5,741 Disability Gamechanger
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    @Racertracy Hello there and welcome to our online community,

    I wonder if you had inadvertently typed your username, rather than a comment? If there's anything we can help with, please let us know :) 
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