The Adult’s Guide To Owning A Credit Card

By Rachel Lay
9th Apr 2018

Real talk: debt is scary. But, because we live in a time when avo toast sets you back ten bucks, and a broom closet in Sydney will set you back over a million dollars, us millennials are being forced to get really savvy with money, and that means not being scared of debt. So let's get our shit together, together, and start saving some serious cash.                 

Sounds like a lot, right? But don’t worry—we’ve got you. To bring you this list of credit card must-dos, we've teamed up with the people who know a whole lot more about money than us, Bendigo Bank, to give you the best advice going. Because let’s be real: we will never give up avo toast, but we will want to be rich as hell. 

Interest rates are basically a percentage of your outstanding loan, that you get charged for having a loan. If they were people, we probably wouldn’t want to get stuck with them at parties—let’s put it that way. So, the higher the interest rate, the more you pay back. It’s important, then, that you shop around to find the perfect card for you, that you can actually pay back—including interest!

Bendigo Bank’s new Low Rate Mastercard is a goodie because it gives you access to some of the lowest interest rates out there—seriously, we’re talking half the rate you’re used to. How? Because, dear reader, even if your current credit card has the same interest rate as Bendigo Bank’s you still could still be paying more based on how and when you’re charged interest. At Bendigo Bank, you’re only charged interest from the time of your statement—not from the time of your purchase, and it’s based on the amount you don’t repay in full. If you add it up, that’s around a 50% saving on each bill. Sign. Us. Up. 

When you have a credit card it can be easy to think of it as free money. But trust us, that “free money” piles up real quick, and then you’ve got yourself a hefty pile of debt to pay back (with interest). Been there, done that, and it’s not fun. So, skip all of that and get yourself into the habit of paying it back each time your income comes in, or pay at least the minimum by your statement's due date and maximize your 55 days interest-free. Set yourself up with a budget where you nut out what you earn and what you spend to reveal your ~surplus~ income, aka, what you can put straight onto your credit card or save for a rainy day.

Quick tip, though: don’t go crazy putting all of your cash onto your credit card at once. Keep your repayments reasonable so that you’re not just forced to reach for your credit card again when your spending money runs out four days before payday.

Saving is hard if you like doing things, eating things, or hanging out with people. We feel you. But, if you’re doing all of the above it’s totally fair to treat yourself (within reason). Your budget should take into account what brings you joy, not just what you need to keep a roof over your head. E.g. if you love getting a coffee each morning, budget it in! Whatever your guilty pleasure is, just account for it—and try to keep a log of what you’re spending so it doesn’t go totally haywire. If you're obsessed with designer labels, you might need to spend less on your phone bill or car to make it work, for example. 

Bonus tip? Each time you get paid, put a little money aside into a “credit card fund” that you can treat as your credit when you want to spend cash on something big, but it’s actually just your money so there’s no interest, repayment, or debt. Winning!

If you’re keen to start having an adult relationship with your credit card, check out Bendigo Bank’s Low Rate Mastercard here and switch to fair. 

Editor's note: this article was produced in partnership with Bendigo Bank. Thank you for supporting the sponsors who make The Urban List possible. To read our editorial policy, click here

Image credit: Sarah Law for The Urban List

Note: This article contains general advice only. Readers should seek a trusted professional’s advice on financial matters.

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