then we will hit a brick wall then, only good for couple of month...
might use the strategy for big balance deposit then ? and when interest is high....
Credit card working for you!
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then we will hit a brick wall then, only good for couple of month...
might use the strategy for big balance deposit then ? and when interest is high....
just use this strategy sparingly. I suspect that as lending criteria tightens, 0% balance transfer offers may be few and far in between, as opposed to what happened during the boom time. The last time I saw it was HSBC that still had 6 months 0% promotion.. Not sure about now
Warning on 0% balance transfers.
Many cards will charge 0% on the balance for 6 months or more, so you transfer $9,000 at 0% interest. You then draw down $1000 for a purchase and your assumption is because this is not a balance transfer you pay interest on it. To avoid the interest you pay off the $1000 as quickly as possible.
What actually happens is your 0% balance transfer is now $8,000 and you continue to pay interest on the $1000 you spent. The repayments you make go straight to the 0% portion, not to the additional credit to took out later.
The calculation on credit cards is often very complex and almost never understood by the consumer.
I do use a credit card, but my limit is half my monthly income so there's absolutely no chance I can not afford to clear it every single month.
Many cards will charge 0% on the balance for 6 months or more, so you transfer $9,000 at 0% interest. You then draw down $1000 for a purchase and your assumption is because this is not a balance transfer you pay interest on it. To avoid the interest you pay off the $1000 as quickly as possible.
What actually happens is your 0% balance transfer is now $8,000 and you continue to pay interest on the $1000 you spent. The repayments you make go straight to the 0% portion, not to the additional credit to took out later.
The calculation on credit cards is often very complex and almost never understood by the consumer.
I do use a credit card, but my limit is half my monthly income so there's absolutely no chance I can not afford to clear it every single month.
Credit cards can be really helpful, provided you pay them off within those 55 days of interest free. If you go over, then you will be charged.
I use mine to pay for those things that I didnt expect to buy... then I pay the card off within 2-3 weeks max. They can also be really useful to pay for car insurance and so on.
Works great for me.
PT_Bear's warning above is very timely - the Brisbane Courier Mail had an article this morning by Scott Pape (The Barefoot Investor) in which he wrote of exactly this. But beware: a friend of ours got caught by one of these "interest-free balance transfers". If you are going to down this path, don't fall into the trap of putting purchases on this card. You have to make an initial purchase to activate the card, I believe, but keep it small ($10 or so) so that the interest you pay is minimized - then pay it all off as soon as you can!!! Personally, I would not go down this path - but I understand that it's an option which may work for some.
Cheers
LynnH
Cheers
LynnH
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I've only done the balance transfer dance twice .. but I've never needed the card active, so I just don't activate it. Helps stop me from using it!
I would start off with a Westpac Earth card to get free membership to Qantas FF (worth $82.50). The annual fee for the card is $49. There are promotions from time to time offering things like no annual fee for the first year, bonus FF points etc. Look at the site below for details.
The best card for Qantas FF points is the Qantas Amex card... There is a promotion currently on for no annual fee for the first year and 5000 bonus Qantas FF points. There are different versions of this card, so best to research which one suits you best.
A great site for researching the Qantas FF programme and getting the best reward points is:
www.frequentflyer.com.au/community
You can go to each of the reward programmes and look for current promotions and details of how to maximise your FF points.
This is very true if you are disciplined enough to handle them correctly. If you tend to spend frivolously, then it is good to cut them up but if you know how how make them work for you, they are fantastic.
ANZ gold frequent flyer cc is great. I use this for all expenses and it is paid off in full every month using autopay. If you put all your reno costs on it the points increase pretty quickly!
Here is the link to a list of cc offering 0% and low interest rates. Handy if you know you can pay off or transfer to another within 6mths.
http://www.creditcards247au.com/?gclid=CLv8gMHD-Z8CFUcwpAodr2S8WQ
Here is the link to a list of cc offering 0% and low interest rates. Handy if you know you can pay off or transfer to another within 6mths.
http://www.creditcards247au.com/?gclid=CLv8gMHD-Z8CFUcwpAodr2S8WQ
Seeing this old cc thread has been bumped:
Qantas FF may want to take a look at the Qantas site for the Amex Ultimate card. You need to be a new Amex cc customer (but i think existing Amex charge card may be ok?). Spend $4000 over 3 mths and get 50,000 points! That amount of points is enough to convince me to close my existing card & hop over to this one. Of course, read the T & C. Annual fee: $450 Min. income: $65k etc, etc.
Qantas FF may want to take a look at the Qantas site for the Amex Ultimate card. You need to be a new Amex cc customer (but i think existing Amex charge card may be ok?). Spend $4000 over 3 mths and get 50,000 points! That amount of points is enough to convince me to close my existing card & hop over to this one. Of course, read the T & C. Annual fee: $450 Min. income: $65k etc, etc.
Hi Ms Jade,
Like the sound of that card! Great for investors/business owners with lots of bills. A surgeon I used told me him and his wife use a Qantas ff for all business costs and they get several o/s trips/yr! I guess they would have large expenses but also well and truly enough income to pay off each month so cc are great if you have financial will power to not spend on frivolous items!
Like the sound of that card! Great for investors/business owners with lots of bills. A surgeon I used told me him and his wife use a Qantas ff for all business costs and they get several o/s trips/yr! I guess they would have large expenses but also well and truly enough income to pay off each month so cc are great if you have financial will power to not spend on frivolous items!
