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Where once the choice of credit card in the UK was extremely limited, now there is a plethora of companies bombarding everyone with promises of low interest rates, balance transfers and cards which are a status symbol for the holder. In addition to this, most of the High Street stores now offer their own store cards, giving you credit to spend in their store or a chain of stores only.

When you reach the checkout at a clothes store, for example, you are offered a reduction on your purchases if you take out their store card at that point. This makes it extremely easy to say yes and many people agree so that they get the discount without checking any of the small print or terms and conditions. The danger of this is that these cards have notoriously high interest rates of up to 29.9% and for many this is the start of the decline into debt.

Credit cards and store cards work in much the same way and some credit cards have interest rates as high as the store cards, However, if you have a balance on your credit card and cannot afford to pay it off in full, there are ways to use them to your advantage. Many card suppliers offer interest free periods for balance transfers. This will allow you to transfer your existing balance on to another card and pay off as much as you can afford for a set period, often six months, without paying interest on it. This can give you a real opportunity to reduce your debt.

If you have substantial debts on credit and store cards and as a result can only afford to pay the minimum payment on each you may well find that for some of them the monthly interest is actually greater than the amount you are paying and so your balances may actually increase. This is a scary situation to be in as there often seems no way out. In these cases it is often worth trying to take out a personal loan to consolidate all your debt. This will have a significantly lower interest rate than many of the cards and will also reduce the minimum amount you have to pay each month.