There are various types of credit cards and choosing the right type for you, your budget and your occupation may help you to save money on credit card costs or your purchases.
Credit Card Types In Australia
- No annual fee credit cards: Although these cards generally have high standard purchase rates, they still help you to save money since they will not require you to pay off a yearly account fee. Considering they will have higher interest rates, you need to pay off your account balance timely each month.
- Low interest rate credit cards: These type of credit cards often have average 9.99% interest rate which can only be applied to purchases while interest rates of other credit cards are usually around 17-18%. Some credit cards may even have no interest for a promotional period.
- Balance transfer credit cards: Can be used for debt consolidation. You can transfer all of your current debts onto that credit card to make your monthly repayments without interest until promotional period (generally 6 to 20 months) ends.
- Rewards credit cards: Although they usually come up with premiums and higher interest rates and fees, they allow you to earn points as you spend and use that points for many purposes including entertainment, travel and flights.
- Frequent flyer credit cards: Allow you to earn points as you spend and use that points especially for your travel expenses including flights, lounge passes, hotels, car rentals, etc.
- Gold, platinum and black cards: They are suitable for people who earn a high income since they come up with higher annual fees and premium options. Their minimum credit limit is higher than normal and there is a strict criteria to be found eligible for these cards.
- Student credit cards: They are specially designed for students and usually have low annual fees and low credit limits.
- Business credit cards: They are designed for people who run a business and help you to keep track of company expenses.
- Travel credit cards: Since they offer free international ATM withdrawals and you will not be charged foreign transaction fees, they can be good for traveller.
How To Choose The Right Type?
- Consider your occupation: For example, if you are a student you may consider applying for a student credit card to get lower annual fees and credit limits or if you are a business owner you may want to have a business credit card to track your cash flow.
- Consider your income: Companies may want to see if you meet minimum income requirement and decide whether you can get a credit card accordingly.
- Consider your repayment ability: Annual fees and interest rate may cause you to face financial issues so you need to find the most suitable type for your budget.
How To Apply For A Credit Card?
Firstly, you need to meet the eligibility criteria which requires you to be 18 years old or older, to be an Australian citizen, to meet minimum income requirements and to have a good credit history. Then, you should provide the necessary documentation including:
- Personal details
- Employment details
- Financial details
- Card details