IT IS a truth universally acknowledged that a single man in possession of a good fortune must be in want of a credit card.

And as the saintly Jane Austen might have observed, card companies are wanton hussies when it comes to capturing your heart and, of course, your wallet.

The most brazen in this racket are the store cards, which are like credit cards but they cover only specified outlets. These flamboyant floozies charge quite hysterical rates of interest — and then add another zero. Repeat after me: “I love their pants but not their plastic.”

The principles of conventional credit-card ownership are simple. Rule one: don’t go there. Rule two: if you must, then stick to one piece of plastic. Credit is just debt in disguise. These companies are trained by Mephistopheles himself — they will tempt you to overspend and then charge interest on the balance that is way above what you could get from a bank loan. They want to own you, body and soul.

Sticking to one card requires self-control when so many companies are shamelessly offering you ever larger credit limits. Your choice will depend on the way you handle or mis-handle your money. If you repay the bill every month — and, by the way, they’ll hate you for this — then look for the card with the cheapest annual fee. If you tend to let the debt build up then you need a cheap annual percentage rate (APR).

Take a look at the websites in the box (right) to find out how the maths works and for tips on the best rates.

Card companies love you if you use your plastic up to its limit — so much so that if your consumption outstrips your credit they’ll offer you some more and repeat the exercise six months later.

What they really don’t like are “rate tarts” — the charming description given to smart customers who borrow to the hilt and then switch to a new card company that is offering 0 per cent interest on balance transfers. Serial rate tarts repeat the exercise as often as is necessary to get their balance down.

I know of one enterprising MBA student (who shall remain nameless) who became a rate tart so as to finance his postgraduate education. To the card companies, whose honour he had sullied, this student was a cad and a bounder.

Of course we couldn’t possibly recommend such tactics. Besides his name will be on a file. Several in fact.

Because once you sign up they know everything about you, including, naturally, where you you live. If you don’t keep up minimum repayments then you are credit-card history and may never get a mortgage. Always keep up the minimum payments.

But should a card company call you a tart — or words to that effect — and inform you that it won’t put up with your whims and inconsistencies any longer, you may reply, archly: “Well, Mr Darcy, whims and inconsistencies do divert me I own, and I laugh at them whenever I can.”

Debbie Harrison is a senior visiting fellow at Cass Business School (www.cass.city.ac.uk)

PLASTIC FACTS

Useful websites:
Financial Services Authority www.fsa.gov.uk/consumer
Money Net www.moneynet.co.uk
Moneyfacts www.moneyfacts.co.uk
Motley Fool www.fool.co.uk
Which? www.which.co.uk

Sources of advice:
Citizens Advice Bureau www.adviceguide.org.uk
Consumer Credit Counselling www.cccs.co.uk
National Debtline www.nationaldebtline.co.uk

To see previous articles in the series log on to: www.cass.city.ac.uk/thetimes

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