This guide has been written to inform you about getting the right credit card to suite your personal needs. There are hundreds of types of cards it is imperative you select the correct card. Selecting the correct card could save you hundreds of dollars in the long run or give you rewards such as free travel, appliances and other benefits.
What is a credit Card?
It is a plastic card with a magnetic strip, issued by a bank or financial institution to a customer to buy goods and or services on credit. Also called a charge card. Credit is money given to a customer to borrow over an extended period of time. Banks and financial institutions make money by charging an interest on money lent to the customer. Generally credit cards charge a high interest rate this is because a credit card is designed for small purchase for short periods of time.
What are the major banks in Australia?
Australia has four major banks with triple A (AAA) credit rating. This is the highest level of credit rating a bank or financial institution can achieve. The 4 major banks for Australia are:
- Commonwealth Bank
- St. George Bank
- Westpac Bank
- ANZ Bank
These banks are always recommend for borrowing money because they are most secure and regulated. However they don’t always provide the cheapest line of credit available. Sometimes smaller banks and financial institutions card offer cheaper credit and a better deal with better customer service. Remember to research all small banks and financial institutions, read the fine print on there contacts myaccountaccess.com.
What credit card suits me best?
There are many types of credit cards on the market today, the shear amount of credit cards can make picking your credit card a difficult decision, and so we have divided all the credit cards on the market into 6 categories.
A balance transfer credit card is great for when you currently have a debit on another credit card (generally over AUD $5000) and you would like to swap it onto your new credit card with a new bank or financial institution for a lower interest rate. You will be given the option depending on the credit card for 6 months 12 months or lifetime interest rate, The lower the time the better the savings. Essentially you can move from card to card taking the lowest 6 month interest rate.
Debit Card (pre-paid)
A debit card is essentially a pre-paid credit card. This kind of card is great for customers who wish not to have credit access. Most Customers who use this card generally purchase items online, because this card works exactly the same as a credit card bar the fact you must put money into the card before you can purchase your good or service.
A frequent flyers card is for customers who wish to get point for purchases and transfer these point into rewards such as free plane flights to locations depending on how many points you receive will translate to how far you can go. To gain points you must purchase items. The average points per dollar is 3 points to 1 dollar.