As a general rule of thumb, the same credit card should not be used for purchasing items and to transfer previous debts, it has been claimed.
While seeking out competitive credit card offers can prove to be an effective means of not only purchasing items but - through 0% balance transfers - also getting to grips with pre-existing debt, such products need to be used with caution, it has been reported.
Indeed, most credit cards are extremely useful for both their interest-free balance transfer and purchases periods, 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 provides its users with the longest 0% period on balance transfers than any other card on the market, its interest-free period on purchases is much less competitive, with just 3 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 doing so could be to borrowers' detriment.
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 because the product offers a nine-month 0% deal on both purchases and balance transfers.
She points out that consumers should look to ensure all debts owed are paid off by the time the offer expires, otherwise the typical interest rate of 15.9% will be charged.
Those looking for a 0% purchases card were also advised to consider the Tesco Clubcard, offering 0% on spending for up to 12 months on the condition that at least the minimum monthly repayments are made.
Another to sing the praises of the Tesco Clubcard was lovemoney.com writer Serena Cowdy who recently claimed that the 0% balance feature is "perfect for gradually paying back big expenses".
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