My weekly round-up of your personal finance questions.
I love hearing from you, whether it’s on the blog, social media, YouTube or on email. Often you’re asking me questions about your finances, and I’m always glad to help if I have the time.
But I realised that my answers could also be useful to other followers. So I’ll be putting my responses to the best questions into regular articles here on the blog.
Keep reading for some of the questions I’ve been asked, plus the video live from last week with even more!
Watch the latest Q&A
Watch my answers to questions in the weekly Q&A on YouTube
Can I use a credit card too often?
Say I used a credit card only for travel as I go to university and work is this ok as I will use it four times a week which is quite alot??
Chanel via YouTube
As long as you clear that total balance every month and avoid the interest charge then you’ll be absolutely fine!
If you’re worried about forgetting to pay the full amount you can set up a direct debit to clear it every month, or you can even transfer from your current account the exact amount you’ve spent as you go along. Here’s more on first-time credit cards.
Does Chip’s interest rate reduce when the bonus is added?
If I were to add £2,000 into the account and leave it at that, would the 1.25% interest decrease as the bonuses are added in? I.e. once it starts going over £2k.
TS via YouTube
No, if you’re on the ChipLite option the most you can earn interest on is £2,000. And in fact there’s no interest earned on the interest either (one thing that makes it different to other savings accounts). So it won’t make a difference to what you’ll get.
If you opted for ChipAI which has the £1.50 fee every four weeks, then the effective rate is impacted no matter how much money you have in there, whether it’s £500 or £10,000. Here’s more on the Chip+1 account.
Which current account should I get for my credit report
I have recently moved to the UK from Italy. Thus, I have no credit history here and one of my goals is to build a solid credit score as soon as possible. I am aware that having a credit card is the best way to build a credit history. Unfortunately, I’m facing the ridiculous trap that I cannot apply for a credit card because I have no credit history in the UK and, at the same time, I cannot build a solid credit history without using a credit card or any other form of credit.
When I arrived to the UK I opened Starling Bank as my main and only bank account here.
However, I discovered that Starling Bank does not report my account to Experian. Therefore, I have decided to open a more traditional brick-and-mortar bank account with one of the UK high street banks.
At the beginning I was thinking to open an account with HSBC or Barclays, but I have not had a good feeling with them. Thus, I was researching a bit more and I got a good vibe from the following 3 banks: Nationwide, NatWest and Metro Bank. Metro Bank seems great, but it’s pretty small when compared to the other two.
So, I was thinking to open an account with Nationwide and then apply for their member credit card after a couple of months. I am not interested on overdraft or credit since I have money. I only need a good and efficient bank with a good credit card to quickly build my credit score in the UK.
What are your thoughts about Nationwide? Any advice about that?
Ado, via email
Yes, it’s a problem people find if they go full Starling. It’s the same for Monzo, though they don’t report to Equifax. It’s another good reason for people to always have a back up account if you’re using either of those excellent digital banks.
It sounds like your interested in the ethics of current accounts, so both Metro and Nationwide are decent options to consider here (Natwest less so).
I think you’d be happy with either of them. Nationwide had a few different accounts, the most popular is the FlexDirect account which offers 2% interest on up to £1,500 for the first year, but you might be better off just going for the standard FlexAccount – no frills but will do everything you need it to.
The app is a bit frustrating, but if you use in it tandem with your Starling account you can avoid most of that. For example, have your salary go to Nationwide (or Metro) and then transfer your spending money to Starling.
Then you can take advantage of all the latter’s features while still having Nationwide appear on all your credit reports.
Should I transfer my Help to Buy ISA to a Lifetime ISA?
I currently have a Help to Buy ISA, would you recommend switching to a Lifetime ISA?
Rosie, via Instagram
So it can seem tempting to move it over, particularly as you can put more money each year into a LISA.
But it all depends on a few factors. First, when are you planning to buy? The LISA must have been open for 12 months before you can use it – can you wait that long?
Second, how much will the property cost? You’re limited to £250,000 outside London with the HTB ISA, but £450,000 everywhere with the LISA.
Also, how much do you have in the HTB ISA? You can only transfer over £4,000 a year into the LISA. If you’ve already built up more than this you might want to stick with the HTB.
Next, are you definitely going to buy a property that qualifies for the account? If you don’t buy, or it costs more than the limit, you can withdraw the money penalty free from the HTB ISA. If you don’t with the LISA you’ll have to pay a 25% penalty, or wait until you are 60 years old.
Is Wise good for travelling?
What are your thoughts on Wise (formerly Transferwise) debit card for travelling?
Zak, via Instagram
I think Wise is a great option if you receive or hold different currencies as it can be a lot cheaper to move money to pounds and vice versa than normal banks. I’ve got one for a few advertisers that pay me in dollars and it was the cheapest way to convert the cash (that could have changed – I’ve not checked for a couple of years!). But there’s still a transfer fee to do this.
So if you’re thinking of just using a card for holidays or short periods overseas then you’ll be better off with a fee-free account from the likes of Starling or Virgin Money, or a specialist travel credit card such as the Barclaycard Reward account. There’s no charge at all on these. Here’s more.
How to ask me questions
The best ways to get in touch is in the Andy Clever Cash Facebook community
Just post your question any time, or ask me live in my weekly Q&A each Thursday (which is also on Instagram and YouTube).
You can also comment on individual blogposts and videos or ask me questions via these channels:
I can’t promise I’ll be able to answer all questions but I’ll do my best.