On television and the big screen, credit cards are often portrayed as a consequence-free solution to our financial woes. In the real world, it’s not quite that simple.
There are interest rates, expiry dates, reward programs and minimum payment requirements – all vital considerations to ensure you get the most from your credit card and avoid being overrun by debt.
We provide the lowdown on the risks and rewards to help you decide whether a credit card is the right financial decision for you.
This is the first question you should ask before jumping into a major decision. After all, a credit card isn’t for everyone. Below are just a few of the advantages:
As with any debt, using a credit card comes with a degree of inherent risks. As long as you , however, you won’t spend beyond your means. Here are some common credit card risks to monitor:
Reward programs, for example, offer loyalty points based on how much you spend. These points can then be exchanged for various rewards, such as purchasing products or receiving cashback.
When comparing credit card reward programs, consider the rewards you actually want and whether or not they’re worth the fees associated with the card. Finding this balance will capitalise on your spending style and provide true value for money.
If you’re struggling to choose a credit card, iSelect’s comparison tool can help take the stress and confusion out of your search. Simply tell us what you’re hoping to get out of a credit card and we’ll provide you with a list of options to compare.
iSelect does not compare all products in the market. Not all products are available at all times. iSelect does not compare all products in the market. Not all products are available at all times. Any advice provided in this content is of a general nature and does not take into account your objectives, financial situation or needs. You need to consider the appropriateness of any information or general advice we give you, having regard to your personal situation, before acting on our advice or purchasing any product.