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How Aussies can repay their $286 million credit card interest Christmas debt with a balance transfer

Aussies are carrying $286 million in credit card interest after Christmas. Take advantage of a balance transfer offer to repay your debt faster without the cost of interest.

Christmas is the time the our credit cards take the biggest hit, so it’s no surprise that Australians are now facing a post-holiday surprise in the form of sky-high interest and credit card debt. Not all hope is lost though, as there are some simple steps you can follow to take control of your credit card debt. Here we’ve unpacked just how much Aussie cardholders owe and the balance transfer offers that could help reduce your debt hangover in the new year.


Interest free balance transfer credit cards could be a lifeline for those who splurged at Christmas. And it seems many Australians agree – we’re noticing the number of people searching finder.com.au for balance transfers during the post-Christmas period is 158 percent higher than this time last year. Bessie Hassan, Consumer Advocate at finder.com.au

How much do Australians owe after Christmas?

You could say that Aussies are either overly generous or perhaps too flippant with their credit card purchases over Christmas time. Regardless, a forecast of the Reserve Bank of Australia reveals that the nation borrowed a whopping $27.5 billion on credit cards for purchases and cash-out transactions in December 2015. $3.2 billion of these transactions were spent on Christmas gifts alone. Now that the silly season has settled and the Christmas decorations have been put away, Aussie cardholders are faced with the reality of an average of $1,668 debt each and a collective $286 million in credit card interest to repay. Sadly, more than one in three cardholders (or 35%) aren’t expected to pay off their credit card bills in time. On the contrary, it’ll take roughly more than five months to repay the balance.

While these figures are worrying, here’s where debt consolidation strategies come in handy. If you want to fast-track your debt repayment without the cost of interest, an interest-free balance transfer credit card could be your answer.


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If you'd like to learn more about the Christmas Debt Hangover, have any questions about the points on this page or want more data (survey, analysis or credit card statistics) on this topic, please contact Bessie Hassan.

Bessie Hassan Bessie Hassan

Bessie@finder.com.au@bessie_hassan/in/bessiehassan
M: +61 402 567 568
P: +61 2 9299 7602

How can I compare balance transfer credit cards?

One in three cardholders aren’t expected to pay off their Christmas credit card bills in time Bessie Hassan

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Balance transfers credit cards can be a savvy way to repay your debt faster without accruing interest along the way. However, as at the time of writing, there are currently 98 credit cards offering interest-free balance transfer deals for up to 20 months in the Australian market, it’s important to know what to look out for to find the right card for you. To make things easier, we’ve highlighted the important factors to consider and compare when looking for a credit card to drive your debt consolidation:

  • Length of balance transfer. There are a number of 0% balance transfer cards on offer, but the low interest will only be in place for an allotted period. Consider how much you owe and how long the 0% interest is in place to determine whether you can repay your debt before the revert rate kicks in.
  • Revert rate. Speaking of revert rate, make sure to compare this before applying. The revert rate refers to the interest rate your remaining balance will be charged if you’re unable to repay the total amount by the end of the introductory period. “They can revert to much higher rates if you don’t pay off the transferred debt during the transfer period. So it's a good idea to work out how much you need to repay each month to ensure your balance hits zero by the end of the balance transfer term,” suggests Ms Hassan.
  • Size of your debt. Most balance transfers restrict how much you can transfer to a percentage of the credit limit. This can vary from card to card (for example, from 70% to 100% of the credit limit), so it’s important to check this to confirm whether the card can support your debt. Plus, you’ll need to consider the size of your debt, the promotional interest rate and the length of the balance transfer to calculate how much you’ll need to repay each month to pay off the total amount before the promotion ends and the revert rate rolls in.
  • Other features and costs. While your main concern is the details of the balance transfer, it’s important to consider other costs and features of the card to ensure you can both afford and benefit from it. Look at the annual fee and one-off balance transfer fee (usually 1% or 2% or your transfer amount), in particular. It’s not recommended to use the card for anything but debt consolidation until the amount is entirely repaid, but you might want to consider if the card comes with a low interest rate on purchases or interest-free days if you plan to use the card after you’ve repaid the debt and the promotional offer has ended.

Long-Term Balance Transfer Credit Cards Comparison

Rates last updated June 29th, 2017
$
% p.a.

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Name Product Balance transfer rate (p.a.) Purchase rate (p.a.) Annual fee Interest Saved Product Description
NAB Premium Card
0% p.a. for 20 months with 2% balance transfer fee
19.74% p.a.
$90 p.a.
Benefit from premium perks including travel insurance, Platinum Concierge Service plus 0% p.a. for 20 months on balance transfers.
Virgin Australia Velocity Flyer Card - Exclusive Offer
0% p.a. for 18 months
20.74% p.a.
$64 p.a. annual fee for the first year ($129 p.a. thereafter)
Earn 2 Velocity Points on top of the standard earn rate per $1 spent in the first 3 months, plus a $129 Virgin Australia Gift Voucher each year.
St.George Vertigo Platinum
0% p.a. for 20 months
12.74% p.a.
$99 p.a.
Offers complimentary travel insurance, complimentary purchase insurance and access to a 24/7 personal concierge service.
Citi Rewards Platinum Credit Card
0% p.a. for 24 months with 1.5% balance transfer fee
20.99% p.a.
$49 p.a. annual fee for the first year ($149 p.a. thereafter)
Offers a long-term balance transfer. Earn extra points on eligible international spend, plus complimentary travel insurance.
St.George Vertigo Visa
0% p.a. for 14 months
13.24% p.a.
$0 p.a. annual fee for the first year ($55 p.a. thereafter)
Receive up to 55 days interest-free on purchases and the ability to make contactless payments with Visa payWave technology.
ANZ Platinum Credit Card - Exclusive Offer
0% p.a. for 12 months
0% p.a. for 3 months (reverts to 19.74% p.a.)
$0 p.a. annual fee for the first year ($87 p.a. thereafter)
Receive a low introductory offer of 0% p.a. on purchases for 3 months and 0% p.a. on balance transfers for 12 months.
HSBC Platinum Credit Card
0% p.a. for 22 months with 2% balance transfer fee
19.99% p.a.
$99 p.a.
Earn 1 Reward Point per $1 of eligible spend and receive complimentary travel and purchase protection insurances.
Bank of Melbourne Vertigo Platinum
0% p.a. for 20 months
12.74% p.a.
$99 p.a.
Get a range of complimentary insurance covers, access to a 24/7 concierge and up to 55 days interest-free on purchases.
Bankwest Breeze Mastercard
0% p.a. for 21 months with 2% balance transfer fee
12.99% p.a.
$59 p.a.
Receive up to 55 day interest-free on purchases and free worldwide emergency card replacement.
BankSA Vertigo Visa
0% p.a. for 14 months
13.24% p.a.
$0 p.a. annual fee for the first year ($55 p.a. thereafter)
Get up to 55 days interest-free on purchases and be protected by 24/7 Falcon® Fraud service.
NAB Low Fee Card
0% p.a. for 16 months with 2% balance transfer fee
19.74% p.a.
$30 p.a.
Receive complimentary purchase protection insurance, special offers from Visa Entertainment and up to 44 days interest-free on purchases.
HSBC Low Rate Credit Card
0% p.a. for 15 months with 2% balance transfer fee
13.25% p.a.
$55 p.a.
Receive up to 55 days interest-free on purchases. Also enjoy exclusive offers with the home&Away Privilege Program.
Virgin Money Low Rate Credit Card
0% p.a. for 12 months
11.99% p.a.
$99 p.a.
Receive up to 44 days interest-free on purchases and the optional insurance coverage of CreditShield Edge.
Westpac Low Rate Card - Online Only Balance Transfer Offer
0% p.a. for 24 months with 2% balance transfer fee
13.49% p.a.
$59 p.a.
Take advantage of 0% p.a. for 24 months on balance transfers with a 2% BT fee. Plus, the convenience of the Westpac mobile banking app.
NAB Low Rate Platinum Card
0% p.a. for 16 months with 2% balance transfer fee
13.99% p.a.
$100 p.a.
Enjoy the protection of 7 complimentary insurances including overseas travel and purchase protection insurance.
ANZ Low Rate Platinum
0% p.a. for 16 months with 2% balance transfer fee
11.49% p.a.
$99 p.a.
Enjoy platinum benefits with exclusive discounts, complimentary travel and purchase insurances and a 24/7 personal concierge.
American Express Essential®  Credit Card
0% p.a. for 12 months with 1% balance transfer fee
14.99% p.a.
$0 p.a.
Get Smartphone Screen Insurance of up to $500 when you pay for your phone or contract with your Essential Credit Card.
Woolworths Everyday Platinum Credit Card
0% p.a. for 14 months
19.99% p.a.
$0 p.a. annual fee for the first year ($49 p.a. thereafter)
Receive a $100 eGift Card when you apply by 30 June 2017 and make an eligible purchase by 31 July 2017.
American Express Explorer® Credit Card
0% p.a. for 12 months with 1% balance transfer fee
20.74% p.a.
$395 p.a.
Receive a $400 Travel Credit every year and up to two entries per year to the American Express Lounge at Sydney International Airport.

Compare up to 4 providers

If you’re burdened with debt following Christmas, you’re not alone and there are things you can do to take control of your credit card. An interest-free balance transfer credit card could be a worthwhile way to repay your debt faster without collecting interest in the mean time. As the market is currently saturated with competitive interest-free balance transfer offers, you’ll need to compare what’s out there to find the best debt consolidation solution for you.

It's not too late to plan a strategy to get rid of your debt

Sally McMullen

Sally McMullen is a journalist at finder.com.au who is a credit cards, frequent flyer and travel money expert by day and music maven by night.

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