Martin Lewis: money warning issued over Barclaycard UK change, Money Saving Expert savings advice - news

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The change means that paying off a £1,000 debt could now take you a decade longer

Martin Lewis has issued a cautionary note to Barclaycard users, offering advice about a “worryingly under-the-radar change” that “sounds trivial” but isn’t.

After learning that the bank is changing how repayments are calculated for millions of customers—meaning that the minimum amount you must repay each month will probably be reduced starting in July—the money-saving expert voiced his concerns on Twitter/X.

“Sounds trivial,” he wrote, “but it could DOUBLE the total interest you repay.”

Lewis added: "This is a worryingly under-the-radar change by the UK's biggest credit card provider. Changing minimum repayments looks innocuous, even trivial – most customers will, I suspect, have ignored it.

"Yet this seemingly technical and bland change is a huge danger signal. I wish I could light up the sky with neon signs shouting that, for those unaware, if paying interest on their credit card debt, it can easily DOUBLE the total cost of debt by the time you clear what you owe, meaning you pay £100s or £1,000s more.”

In essence, the change means that paying off a £1,000 debt could now take you a decade longer and cost you almost £1,000 more than it did previously.

"Minimum repayments have always been credit card firms' secret weapon. Letting people repay little looks appealing – hence why Barclaycard says this is about 'flexibility',” Lewis said. “Yet it takes flexibility to kick your own backside, and this will hurt some just as much.

“Barclaycard's reduction, for many, from 3.75% of the balance to 1% of the balance – means while people's repayments will cover their interest, they will clear far less of what they owe, prolonging the debt, keeping people indebted year after year after year, and the interest racking up year after year after year."

What do I need to do?

As always, Lewis offered his own advice on steps to take if you don’t want to be hit too hard by the incoming change.

He said: "I would urge ALL Barclaycard customers to sit up, take note of this, and check now if you only pay the minimums.

“If so, unless you've other, even costlier debt you're clearing first, if you can't afford to repay in full each month, try to make a FIXED monthly repayment based on what you can afford – even if it's the same amount as your current minimum – rather than letting your repayments decrease as you owe less.

“This can radically reduce the length you're in debt and the interest cost. The more you can repay, the less interest you'll be charged."

For Martin Lewis’ and Money Saving Expert’s full guide to the changes and what to do, head here

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