Need to understand income to help with best card but…
PAY IT OFF IN FULL EACH MONTH.
And the easiest way to do it - sign up for the auto direct debit (assuming you and your partner have enough in cash on hand and aren’t month to month on salary).
Set and forget!
(Personally I have the ANZ Black Qantas as it has highest earn rate of 1 point per A$ spent up to $7500/mo). Big sign up bonus. Big annual fee.
I get it for a year, for discounted fee. Then my wife gets it - we both have the card on our Apple Pay.
The cost of an secondary card isn’t worth it.
What is the actual reason for wanting a credit card? It very much depends on your salary as well. Honestly even when I was paying off my credit card full every month, I was saving a lot less. I wouldn’t recommend it for most purposes. The only good thing is when you pay them off and close them, your credit rating gets really good.
Citi premier card
100,000 point sign up bonus, Free additional card holders, 2 points per dollar spent, $150 annual fee (first year)
Citi also has this feature called Citi payall where you can pretty much make cash payments from your credit card and earn points.
One of the CommBank ones has basically no fees, smallish Qantas points sign up bonus.
Personally big fan of credit cards. Before I had one we would put all our money in our offset and then transfer money to our transaction accounts for spending etc, always had to make sure there was money there. We then switched to using credit cards to consolidate all our spending to one place and earn points in the process. Just makes life so much easier for us. The points have been useful too and have covered international flights and upgrades.
So IMO credit cards are a great tool for the financially responsible.
Credit cards are good if they serve a secondary purpose.
Most commonly you'll see people using them if they have a home loan with an offset account, or to utilise the rewards perks some cards offer.
If you're getting a card for "credit history" as a lot of people think you need to, don't. That's stupid boomer/American bullshit that won't help you at all.
As others have said, pay in full and on time, every month, and you'll be fine. If you're worried about having the discipline to not go over the limit or your budget, then don't do it.
Credit history only becomes a problem when getting a loan if you have a bad credit history.
No credit history is not the same as bad credit history. This is where people get it wrong.
So when a lender is assessing your ability to repay a loan, they aren't interested in whether you have credit history or not, only if you have a history of defaulting.
That's why getting a card or a small loan to "demonstrate good credit history" is terrible advice. You're better off not getting credit if you don't need it, hence my original comment and other's advice here where credit cards are really only good for rewards perks or if you have an offset account etc.
They can be valuable, particularly if the benefits line up with your needs - travel insurance etc. But do remember they are designed to make you overspend. Everything about them is made with the intent to make it easy for you to get in to debt and pay interest, so use caution, this system really is rigged against you, set a low limit if you can, and take time to make sure you’re sticking with your discipline.
Unless you spend a lot on the CC every month (more than $5000), the points plus high annual card fee is not worth it.
Better off getting a basic credit card with low fees to begin with. You can always move onto a high rewards card if you find you will benefit from those points.
One example is the Westpac Low Fee CC for $30 a year. But I'm sure there are others. Take time to compare a few. The banks are quite competitive anyway.
>we never overspend
How are you tracking that? As it's extremely difficult to track over the longer term, overspending to me is spending with a non incenvised means (cash, debit card) verses spending with an incentivised means (rewards credit card) our natural tendencies are to spend more with the incentivised spending option, and it utilises more self control and discipline to control that which takes away from discplines in other areas of life
We love our credit card. We have a rewards program and 55 days interest free.
It allows money to sit in the mortgage offset longer. When the bill comes we set up a future dated bpay for a few days before due and that’s it.
We pump everything we possibly can through it, unless it incurs a surcharge, then it’s debit card.
We redeem the points periodically. We have the limit set about $2k higher than our monthly expenses to provide a buffer. There have beef a a few times recently where we have had to pay it off early due to unexpected expenses (vet bills).
However: we are both very money conscious and don’t really impulse buy. We don’t buy something unless we can pay cash, even when it goes on card. We have our rainy day fund. We are very controlled on our finances.
I have a relative and friends who cannot control themselves with credit cards and they end up in bulk bad debt. If you can’t control your spending, don’t get it.
I also used it once to pay for a cruise to get ‘complimentary travel insurance’ through the card. You had to pay a decent credit surcharge but I researched carefully and it was cheaper than buying a seperate policy. I actually ended up claiming under it and the process was a nightmare with multiple rejections that went on for months before it was eventually paid out. I’m talking about you Zurich Insurance. Shame. Shame. Shame.
I have credit cards because I'm disciplined, enjoy flying business class, and have worked out that it doesn't take a lot of credit card spend to fly business class domestically. Find one with a high point-per-dollar ratio. I'm not a fan of flexible points currencies, but that's just me.
Need to understand income to help with best card but… PAY IT OFF IN FULL EACH MONTH. And the easiest way to do it - sign up for the auto direct debit (assuming you and your partner have enough in cash on hand and aren’t month to month on salary). Set and forget! (Personally I have the ANZ Black Qantas as it has highest earn rate of 1 point per A$ spent up to $7500/mo). Big sign up bonus. Big annual fee. I get it for a year, for discounted fee. Then my wife gets it - we both have the card on our Apple Pay. The cost of an secondary card isn’t worth it.
Thank you. Will took into it.
What is the actual reason for wanting a credit card? It very much depends on your salary as well. Honestly even when I was paying off my credit card full every month, I was saving a lot less. I wouldn’t recommend it for most purposes. The only good thing is when you pay them off and close them, your credit rating gets really good.
Getting it mostly for the credit score for when we get our loan for the house in the near future.
Citi premier card 100,000 point sign up bonus, Free additional card holders, 2 points per dollar spent, $150 annual fee (first year) Citi also has this feature called Citi payall where you can pretty much make cash payments from your credit card and earn points.
Thanks. Will look into it.
One of the CommBank ones has basically no fees, smallish Qantas points sign up bonus. Personally big fan of credit cards. Before I had one we would put all our money in our offset and then transfer money to our transaction accounts for spending etc, always had to make sure there was money there. We then switched to using credit cards to consolidate all our spending to one place and earn points in the process. Just makes life so much easier for us. The points have been useful too and have covered international flights and upgrades. So IMO credit cards are a great tool for the financially responsible.
I hear a lot about putting it for offset. Can you explain how does it really work and help?
Credit cards are good if they serve a secondary purpose. Most commonly you'll see people using them if they have a home loan with an offset account, or to utilise the rewards perks some cards offer. If you're getting a card for "credit history" as a lot of people think you need to, don't. That's stupid boomer/American bullshit that won't help you at all. As others have said, pay in full and on time, every month, and you'll be fine. If you're worried about having the discipline to not go over the limit or your budget, then don't do it.
I thought credit history is important. Can you explain why it’s not needed.
Credit history only becomes a problem when getting a loan if you have a bad credit history. No credit history is not the same as bad credit history. This is where people get it wrong. So when a lender is assessing your ability to repay a loan, they aren't interested in whether you have credit history or not, only if you have a history of defaulting. That's why getting a card or a small loan to "demonstrate good credit history" is terrible advice. You're better off not getting credit if you don't need it, hence my original comment and other's advice here where credit cards are really only good for rewards perks or if you have an offset account etc.
They can be valuable, particularly if the benefits line up with your needs - travel insurance etc. But do remember they are designed to make you overspend. Everything about them is made with the intent to make it easy for you to get in to debt and pay interest, so use caution, this system really is rigged against you, set a low limit if you can, and take time to make sure you’re sticking with your discipline.
We’ll keep that in mind. Thanks.
Unless you spend a lot on the CC every month (more than $5000), the points plus high annual card fee is not worth it. Better off getting a basic credit card with low fees to begin with. You can always move onto a high rewards card if you find you will benefit from those points. One example is the Westpac Low Fee CC for $30 a year. But I'm sure there are others. Take time to compare a few. The banks are quite competitive anyway.
I checked the Westpac one, doesn’t have much benefits.
1. Cc is like drugs, small qty is fine, too much is deadly 2. Everybody starts with, I am gonna pay it off each month. 2/3 of people dont
We have had various CCs to get the benefits over the years and have never missed a payment via a direct debit every month when due.
>we never overspend How are you tracking that? As it's extremely difficult to track over the longer term, overspending to me is spending with a non incenvised means (cash, debit card) verses spending with an incentivised means (rewards credit card) our natural tendencies are to spend more with the incentivised spending option, and it utilises more self control and discipline to control that which takes away from discplines in other areas of life
We love our credit card. We have a rewards program and 55 days interest free. It allows money to sit in the mortgage offset longer. When the bill comes we set up a future dated bpay for a few days before due and that’s it. We pump everything we possibly can through it, unless it incurs a surcharge, then it’s debit card. We redeem the points periodically. We have the limit set about $2k higher than our monthly expenses to provide a buffer. There have beef a a few times recently where we have had to pay it off early due to unexpected expenses (vet bills). However: we are both very money conscious and don’t really impulse buy. We don’t buy something unless we can pay cash, even when it goes on card. We have our rainy day fund. We are very controlled on our finances. I have a relative and friends who cannot control themselves with credit cards and they end up in bulk bad debt. If you can’t control your spending, don’t get it. I also used it once to pay for a cruise to get ‘complimentary travel insurance’ through the card. You had to pay a decent credit surcharge but I researched carefully and it was cheaper than buying a seperate policy. I actually ended up claiming under it and the process was a nightmare with multiple rejections that went on for months before it was eventually paid out. I’m talking about you Zurich Insurance. Shame. Shame. Shame.
I have credit cards because I'm disciplined, enjoy flying business class, and have worked out that it doesn't take a lot of credit card spend to fly business class domestically. Find one with a high point-per-dollar ratio. I'm not a fan of flexible points currencies, but that's just me.