Are rewards credit cards worth it?
Non-rewards card customers are $625 better off.
New research suggests Australians may financially be better off using a non-rewards credit card.
A study conducted by finder.com.au analysed the cost difference between rewards and non-rewards credit cards, considering purchase rates and fees.
On average, rewards cards holders pay $182 in annual fees and possess a purchase rate of 19.58%. Comparatively, non-rewards card customers pay $49 in fees and have a lower purchase rate of 14.65%.
When repaying an average credit card balance of $6,298 over a two year period, rewards cardholders incur costs of $1,728, while non-rewards customers pay $1,103 in fees and interest over the same period.
Despite their complimentary extras, financially, rewards card customers are $625 worse off.
Many rewards credit cards offer at least 1 point for every $1 spent but this can fluctuate depending on the provider and the program, subjecting customers to earning or time limit restrictions.
A separate survey found over two-fifths of Aussies return from summer holidays with credit card debt.
Aside from North Americans, Australians are the most impulsive online shoppers. More than a third of Australians (35%) make same day online purchases, the second-highest conversion rate globally.
Millions of Aussies save their credit card details online but would you trust an online store with yours?
Compare a variety of different credit card options before deciding on the right one for you.