Plastic priority: Credit card debt swallowing up big chunks of Aussie income
Credit card repayments are eating up a growing share of Aussie incomes, according to new research by Finder.
A Finder survey of 1,034 respondents, including 301 who carry debt on their credit card, revealed more than 1 in 3 (35%) – equivalent to 1.9 million people – allocate 20% or more of their earnings to their credit card debt repayments each month.
Almost half (47%) of the 12.1 million credit card holders are carrying a debt accruing interest.
Aussie credit card spending reached a record $39 billion in August – up by 8.7% over the past year, according to RBA data. Aussie credit card balances accruing interest reached $20 billion, growing by 3.9% year on year.
Finder's research found almost 1 in 10 credit card holders (9%) said they are forking out a staggering 31%-40% of their income towards their credit card debt.
Sarah Megginson, personal finance expert at Finder, said Australians are struggling to save and living paycheque to paycheque.
"Being stuck in credit card quicksand creates a cycle where you're constantly paying for the past and that can quickly get out of hand.
"If you're dedicating a big slice of your pay to credit card repayments, that's also money you're not using to build savings, invest or get ahead financially."
Megginson said credit card debt is one of the most expensive ways to borrow money if you struggle to pay it off.
"The longer it takes to pay off your card, the more you pay in interest charges – and that can set you back years when it comes to reaching your financial goals.
"Interest rates on credit cards are often above 20% so you ideally want to pay the full outstanding balance each month to avoid interest charges.
"But when a large chunk of your income is going to pay off debt, there's little left to cover rising living costs, and it can feel like you're working hard just to stay afloat.
"Many Australians don't realise that switching to a low-rate or balance transfer card could save them literally thousands of dollars and speed up the path out of debt."
Megginson urged those who are a slave to their credit card debt to rethink their spending habits and put a strategy in place before the debt spiral becomes overwhelming.
"Set up a repayment plan or compare balance transfer options – with some cards offering 0% interest for up to 24 months, you may be able to turn around your situation quite quickly.
"Also try to stop spending on the card and use your debit card instead. Focussing on paying off your credit card debt and avoiding future delinquencies will safeguard your credit score."
Finder's research found 7% of credit card holders allocate an eye watering 40% or more of their income towards their credit card debt.
Methodology
- Finder's Consumer Sentiment Tracker is a monthly recurring nationally representative survey of more than 60,000 respondents.
- Figures in this release are based on 1,034 respondents from August 2025.
- The Consumer Sentiment Tracker is owned by Finder and operated by Qualtrics.
- The survey has been running monthly since May 2019.
Check out some of the best balance transfer credit cards in Australia here.
Sources
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