Credit card costs catch the unwary
Alarming new RACQ Bank research has revealed almost 60 percent of credit card holders were unaware of the adhoc fees they could be charged by their bank each month.
RACQ spokesperson Lucinda Ross said with nearly 16 million credit cards in circulation nationally, unexpected costs had the potential to impact the majority of Australian households.
“More than half of those surveyed told us they paid off their balance each month to avoid interest but admitted to a limited understanding of other costs which may apply to their credit card,” Ms Ross said.
“Fees for annual account keeping, late payments and exceeding your credit limit can all too quickly add up leading to an unpleasant surprise.
“Rewards programs where points can be accrued for flights and vouchers are popular, but they can attract fees too.”
Ms Ross said the Australian Financial Complaints Authority, which replaced the Financial Ombudsman Service last November, received more than 35,000 complaints in its first six months of operation and credit cards topped the list.
“Before you apply for a credit card, think carefully about why you want it and how you’ll pay for it,” she said.
“Make sure you understand the additional charges which apply to different cards. Think about the features you need and what you’re prepared to pay for them.
“When you’ve selected the right one for you, monitor your balance and set yourself reminders so you can plan for extra costs in advance.”