If you find yourself in the situation that you are unable to pay your credit card debt balance off each month then there are steps you can take to reduce your interest charges.
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Not all credit cards are created equally. And so it makes it that much harder to decide which credit card offer to choose. There are many factors you sh.....
CreditMart recently undertook some analysis around interest rates on reward program credit card offers and found that the average interest rate on these cards was 18%, with some cards as high as 20.34%, and the average annual fee around $93 (some cards charge a reward fee on top of this).
With this in mind, should we be throwing away these rewards based credit cards and opt for a card with a lower interest rate.
Shane Stocks the Managing Director of CreditMart.com.au would suggest NO. He believes that any credit card purchase should be based around how you use the card, annual spend and repayment patterns, and not purely based on interest rates.
“The fundamentals around credit card selection don’t change with interest rates going up, the smart shopper will match their usage and repayment patterns with the card features and benefits”.
The key things you need to consider when selecting a card is:
How much would you spend on the card
Do you pay your balance off each month
If you spend more than 10K per year (this will earn you about $100 in reward points to cover the basic annual/reward fees) on your card and you pay your balance off each month you should consider a rewards program card. The amount you intend to spend should also determine which credit card offer to go with as some rewards programs have points capping. That being, you can only earn X amount of points per year and then you stop earning them until the next annual cycle period.
CreditMart has developed the Credit Card Search Wizard to help people find the type of offer they should be looking at. We ask them a series of question and based on these answers we will return offers they can apply for from CreditMart that we believe are suitable.
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