Compare credit cards for good credit rating

To get a new credit card, generally you need to be at least 18 years old and have a good credit rating. You don’t need to be an Australian citizen. Usually you can apply online or in person at a branch of the card issuer. You’ll typically have to supply information like:

• What you regularly earn (e.g. wages, salary) and what you regularly spend (e.g. rent/mortgage, loan repayments, living expenses)
• Your employer’s contact details
• Details of your assets and any debts you are paying off

Before applying for any credit card, be sure you can afford the repayments. It also helps to do some research, comparing different credit cards and what they offer in terms of fees, interest, rewards etc.

When managed properly, credit cards can be a convenient way to access cash and reap rewards. As convenient as they can be, it’s important to keep on top of your repayments so you don’t end up paying more in interest than the item originally cost. Each month, you’ll get a credit card statement detailing how much you owe and how long it will take to pay off the balance by making minimum repayments. If you only make the minimum repayments, it will take you years to pay off your outstanding balance and add extra costs in interest charges. To avoid any extra charges, you should pay the entire bill.

Credit card interest can quickly turn a manageable balance into unmoveable debt. So being able to understand how interest rates translate into dollars is an important skill to acquire.

The common mistake people make is focusing on the credit card’s annual percentage rate (APR), which often sits between 15 and 20 per cent. While the APR does provide a rough idea of how much interest you’ll pay, it’s not entirely accurate.

This is because you actually accrue interest on your balance daily, not annually. So, you need to work out your daily periodic rate (DPR). To do this, divide your card’s APR by the number of days in a year (e.g. 16.9 per cent divided by 365, or 0.05 per cent). You can then apply this figure to the daily balance on your credit card.

Credit cards can be useful, provided you understand the risks. If you’re wondering about how to make a credit card online application, here are some steps to follow:

• Test the market – Many credit card options are available online. Compare providers by fees, interest and perks to ensure you’re getting the best deal.
• Complete the application – Once you’ve selected a card, head to the provider’s website and complete the online credit card application form. Forms vary by providers.
• Provide details – Most cards require you to meet age, residency, income and credit status condition, and you need to provide details like a bank account statement to prove this.
• Review details – Ensure the information you’ve entered is correct.

There are two reasons you should check your credit rating: so you have a better understanding of your financial position, and so you can take action (if necessary) to improve your credit rating.

Lenders often use credit ratings or credit scores to assess loan applications. The higher your score, the more likely you are to get approved – and the more likely you are to be charged lower interest rates and lower fees. Conversely, the lower your credit score, the less likely you are to get approved – and the more likely you are to be charged higher interest rates and higher fees.

If you discover you have a substandard credit rating, there are nine steps you can take to improve it. Those steps include consolidating multiple debts, fixing errors on your credit file, making repayments on time, paying off loans and closing extra credit cards.

Yes, some lenders will provide credit cards to Australians with bad credit scores but it depends on their individual lending criteria and whether you’ve presented your personal finances to show you’re an ‘ideal’ borrower.

Losing your credit card is a serious situation, and could land you in financial trouble. Here is a simple guide detailing what to do when you lose your credit card.

Lock you card – Contact your provider and inform them about your lost credit card. From here lock, block or cancel your card.

Keep track of transactions – Look out for unauthorised credit card transactions. Most banks protect against fraudulent transactions.

Address recurring charges – If your card is linked to recurring charges (gym membership, rent, utilities), contact those businesses.

Check credit rate – To ensure you’re not the victim of identity theft, check your credit rating a month or two after you lose your credit card.

There are a few ways to pay a credit card bill. One way is to pay via BPAY. This means you can make your credit card payment on the phone or via the internet.

You can set up an automatic payment from an Australian bank account to pay your credit card bill each month. You can choose how much you want to pay of your credit card bill when you set up the auto payments.

Different Australian banks will also allow you to pay off credit card bills in person at one of their branches.

Some credit card companies also allow you to pay your credit card via an app whenever each statement is due.

Credit card debt can cripple your finances. If you’re wondering how to get rid of credit card debt, here are a few steps to get you back in the black:

Calculate your debt – Knowing the magnitude of your credit debt is important. Online credit debt calculators make it easy to determine the debt size, and repayments required.

Work out a repayment plan – Take some time to formulate a credit repayment plan. Consider increasing your income, scaling back your lifestyle or refinancing.

Talk to your credit provider – If you’re still struggling with your debt, talk to your credit provider. You may be able to come to a new arrangement.