It’s late February, and almost a quarter of Aussie credit card holders say they’re still paying off Christmas debt.
According to a survey of 2,000 Australian credit card holders by ME Bank, around 23 per cent continue to suffer a Christmas debt hangover.
You can understand why, with the costs of summer holidays and back-to-school expenses also taking their toll over what can be the most expensive months of the year for some. It’s a time where paying back debt can be particularly difficult.
Not only that, but many may be taking on even more debt around this time – such as young people starting university. Besides the debt they’ve taken on via HECS, some students might find themselves needing to borrow more in order to purchase a car or furnish their rentals. Also, heaven forbid they take out a “student” credit card and fail to pay it off by the end of the month. At the time of writing, there are four credit cards targeted towards students and yet three out of four have interest rates around the 20 per cent mark!
The financial struggles of young people were apparent in the ME survey results. For Gen Ys (18-34) over the last six months:
Whether you’re new to debt or it’s something of a continuous battle for you, there are some simple tips you can follow to keep it under control and pay it off faster.
Student and low fee cards too good to be true?
Head of Deposits and Transactional Banking at ME, Nic Emery, says people struggling with credit card debt should address the issue as soon as possible.
“Set up a repayment plan or consider consolidating debts through a personal loan,” Mr Emery said.
“It’s also important to break any repeat behaviour. Make a plan to save or consider cutting unnecessary expenses during peak spending periods.
“Once you’re in a position to start saving, consider making automated deposits into a high-interest savings account or term deposit to keep you on track.”