Study gives new insight into how people spend using their credit cards

May 31, 2007

New studies have shown that many consumers spend up to 15% of their annual income on credit card purchases. This is a large sum of money and often we do not even realise how much we are actually spending.

Over the whole period of our life, it is thought that we could potentially spend up to £150,000 on our credit cards. Money which could purchase a house! Mainly the money is spent on entertainment such as trips to the cinema, eating out, purchasing DVD’s and holidays as well as day trips away. Most Britons seem to spend at least £3,000 per year on their credit cards and many people are shocked by that figure as they do not realise that the larger purchases are adding up.

The study also shows however that consumers are also becoming more knowledgeable on how they spend on their cards. Many people are extremely clever and they just go from one 0% balance transfer and 0% purchases offer to another. So when their period is due to end they switch their credit card to another company offering the same deals. This can save you a lot of money though it does not always work out in your favour.

However whilst many people are becoming more aware of how they are spending on their cards, there is still a small amount of people who apply for gold cards as they simply look good in their wallet. These cards are not really all that they seem to be and the interest rates can be enormous. So extra care does need to be taken when applying for these types of cards, otherwise you could end up in more debt than you expected.

Overall consumers are getting more knowledgeable on how to make better use of the offers available to them. There is still room for improvement though and it is always worth remembering that all small purchases add up.