Hey big spender: Christmas debt woes as Aussies set to pay $286 million in credit card interest
- Australian households borrowed a projected $27.5 billion on credit cards in December 2015
- 35% of Australians will take up to five months to pay off Christmas debt
- Take management of your debt: 98 credit cards offering interest free balance transfers
Australians are set to fork out an eyewatering $286 million in interest payments after accumulating billions in Christmas credit card debt
January 11, 2016, Sydney, Australia
A forecast of Reserve Bank of Australia data analysed by creditcardfinder.com.au reveals the nation borrowed a whopping $27.5 billion on credit cards in December for purchases and cash-out transactions, spending $3.2 billion on Christmas gifts alone.
It’s not the type of post-Christmas surprise Australian households would be hoping for, with more than one in three cardholders (35 percent) not expected to pay off their credit card bills on time – in fact the average consumer takes five months to rid their balance.
The worrying figures reveal the average amount owed after festivities is $1668 per credit card across Australia.
Bessie Hassan, Consumer Advocate at creditcardfinder.com.au, says now is the perfect time to take management of your financial situation, with balance transfers an attractive option for those looking to consolidate debts.
“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 creditcardfinder.com.au for balance transfers during the post-Christmas period is 158 percent higher than this time last year.”
There are currently 98 credit cards offering interest-free balance transfer deals for up to 20 months, according to the creditcardfinder.com.au database
“It's a great time for cardholders to take advantage of the 0 percent interest offers available but remember, these aren’t tickets to free money. 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,” Ms Hassan says.
The annual finder.com.au Christmas Shopping Survey revealed Australians put 36 percent of their Christmas gift purchases on credit card.
“It certainly was a case of ‘spend first, worry later’ for a lot of people who are now facing the reality of a Christmas debt hangover. But many people are feeling the weight of money worries at this time of year as bills like school fees and insurances roll in.
“Meanwhile, credit card providers are coming to the rescue as they gear up for a big month. This time of year is traditionally when they offer some of their best deals to try and lure new customers after the big spending season of December. So it's worth comparing these deals to help you get back on track in the new year.”
Longest 0% Balance Transfers available on creditcardfinder.com.au
|Card||Balance Transfer Offer||Revert Rate||Annual Fee|
|St George Vertigo Platinum||0% for 20 months||21.49%||$99|
|Citi Platinum||0% for 18 months||21.74%||$199 First year (then $249)|
|BOQ Platinum Exclusive on finder.com.au||0% for 16 months||21.74%||$0 First year (then $199|
|Westpac 55 Day Platinum||0% for 16 months||21.29%||$0 First year (then $90 waived with $10k spend in previous year)|
|NAB Premium||0% for 15 months||19.74%||$90|
|Woolworths Everyday Money Platinum||0% for 14 months||21.99%||$0 First year (then $49)|
|Virgin Australia Velocity Flyer - Balance Transfer Offer||0% for 14 months||20.99%||$64 First year (then $129)|
|American Express Essential||0% for 12 months||14.99%||$0|
Source: creditcardfinder.com.au, ranked by longest 0% Balance Transfer periods
For further information
The information in this release is accurate as of the date published, but rates, fees and other product features may have changed. Please see updated product information on finder.com.au's review pages for the current correct values.
finder.com.au is Australia's most visited comparison website and has helped over 4.8 million Australians find better credit cards, home loans, life insurance, shopping deals and more since 2006. finder.com.au compares 250 credit and debit cards from 31 providers, over 300 home loan products, and information from 13 life insurance providers as well as online shopping promo codes, mobile phone plans, travel insurance and more. One Australian every five minutes is using finder.com.au to find better (Source: Google Analytics).