You’ve worked hard all your life and may have built up a comfortable nest egg for your later years.
Now you’re understandably looking forward to retirement, but what happens if you need to borrow during this time?
Perhaps there’s an emergency you have to fork out for, like a new boiler or car repairs, or you need to pay for home improvements. Now that you’re retired, will you be able to take out a credit card to help with these costs? Read our latest blog to learn more.
Am I eligible for a credit card?
You’ll be pleased to learn that being retired shouldn’t necessarily stand in the way of you taking out a credit card. Applications are based on your ability to meet the monthly repayments. If you have a regular monthly income, say from a pension or part-time job, you could be accepted. Your credit history may affect your ability to borrow, but remember not all lenders are looking for the same criteria and there are cards tailored to the needs of most customers.
Ocean Credit Card
Ocean specialises in lending to customers with a less-than-perfect credit history, or who have had their credit card applications turned down in the past. If you are aged over 18 and able to show some history of managing credit responsibly, you can apply. You can use QuickCheck to find out if you’re eligible for the Ocean Credit Card (39.9% APR representative variable) without affecting your credit history.
The Ocean Credit Card offers credit of up to £1,500. It comes with an app that lets customers check their accounts at any time. The card also has the latest contactless chip that lets you pay for up to £30 of items quickly and securely.
We advise any credit card customer to set up a Direct Debit for at least the minimum monthly repayment on your credit card so you don’t have to worry about missing this. However, it’s a good idea to clear your balance in full each month if you can so you avoid paying any interest.
Whether or not you’re planning to apply for a credit card, you should regularly check your credit history. ClearScore and Noddle offer a free credit check and you can visit our previous blogs to see how to improve your credit history in three months.
Financial planning for later life
Preparing for retirement can be daunting, particularly as leaving work may mean you see a significant drop in your income. That’s why it’s so important to carefully plan for this time in your life.
Many homeowners have paid off their mortgage by the time they retire (although this isn’t always the case) and not having this to pay each month can take some pressure off your pension pot. However, there are other outgoings, like insurance, travel, food and utility bills, which will continue. While it should be possible to borrow once you retire, building up a nest egg while you’re still working to help cover these costs means you don’t have to worry about applying for credit and paying interest later.
Disclaimer: All information and links are correct at the time of publishing.