Credit Cards

[kangaroo19]

Hi,

Just wondering what credit card transaction fees are like? I'm asking this because the only card I have seen a mention of transaction fees was with the Wizard card which promotes "0 transaction fees". Any help would be appreciated.

Also, what determines the credit limit? I'm a uni student at the moment on about $14,000 but next year I have a job starting at an accounting firm with $32,000 - will they consider this situation?

Cheers

 

[HeLMie]

probably better off staying away from credit cards if your still attending uni mate.

 

[TigerCraig]

Most credit cards don't have a transaction fee (debit cards do). They do have annual fees which vary depending on whether you want frequent flyer awards, interest free peiods etc.

Credit card applications are "credit scored", meaning all the details from the application are entered into a computer which spits out the approved/declined decision, and the approved credit limit. Minimum credit limit these days is usually $1000.

 

[la47]

From memory Virgin Credit Cards are annual fee free, but they offer no added benefits at all, and I think they're stricter than some with the giving of credit cards out to low income earners

 

[kangaroo19]

So typically credit cards don't have fees for eftpos? what about cash withdrawals - still have my normal savings ATM card for cash withdrawals, but just wanting to know.

 

[TigerCraig]

You don't use a credit card for EFTPOS (unless it is a VISA Debit card - which isn't a credit card despite the VISA branding). If you have your savings account attached to a credit card and use it for EFTPOS transactions, you pay teh normal fees attached to your savings account.

 

[Gets!]

Debit Cards are the way to go. Without a shadow of doubt.

 

[MrAaron]

Most credit cards don't have a transaction fee (debit cards do). They do have annual fees which vary depending on whether you want frequent flyer awards, interest free peiods etc.

Credit card applications are "credit scored", meaning all the details from the application are entered into a computer which spits out the approved/declined decision, and the approved credit limit. Minimum credit limit these days is usually $1000.

but surely anytime you use it there is a small transaction fee right ? even if they dont say it, surely it still has to be there while you use it.

 

[utility]

Debit Cards are the way to go. Without a shadow of doubt.

Debit cards are good IF you don't need to borrow... sort of like comparing oranges to apples.

I don't know of any credit card that charges by transactions, it's just interest on borrowings and an annual fee, though some cards don't have an annual fee. I did some shopping around and St George seem to have the best rates, for example:

Vertigo MasterCard
- 8.99% p.a. on purchases.
- 18.99% p.a. on cash advances.
- $45 annual fee.
- 55 day interest free period.
- MasterCard only.

No Annual Fee
- 16.00% p.a. on all borrowings.
- No annual fee.
- No interest free period.
- Visa or MasterCard.

They have three others too but I'm considering those two or the gold card. I currently have a Westpac credit card, the annual fee is around $50-60, not sure of the rate off the top of my head though it's around 16%. I can probably bump up the limit to $11,500 so I don't think I'll get rid of it.

You need to find a card that suits your needs. If you are disciplined and don't really need a credit card I would obtain one ASAP, as you can quickly and easily obtain a good credit record, which is better than no credit record. Having good credit may help with obtaining loans or borrowing in general in the future.

If you don't need to borrow and have a 55-day interest free period this is extremely easy to do - pay groceries on credit etc. and do an online bank transfer to pay off the credit card.

 

[TigerCraig]

but surely anytime you use it there is a small transaction fee right ? even if they dont say it, surely it still has to be there while you use it.

No - all credit cards (and charge cards) that I know of do not have transaction fees. You may pay an annual fee, and you pay interest if you don't clear the debt in full each month.

Credit cards are the best way to pay every bill - so long as you clear the debt in full every month. Debit cards or cheques are for idiots or poor financial managers.

 

[Philzsay]

On some credit cards you will get a fee for any cash advances (ie taking money out of an atm). It should all be detailed in the fine print...

Just make sure you pay off the credit card in full each month. Only paying off the minimum amount each month is financial stupidity...

 

[TigerCraig]

On some credit cards you will get a fee for any cash advances (ie taking money out of an atm). It should all be detailed in the fine print...

Just make sure you pay off the credit card in full each month. Only paying off the minimum amount each month is financial stupidity...

Good point - cash advances are a major trap, especially if you do them in the branch. You can get slugged up to $50.

 

[la47]

but surely anytime you use it there is a small transaction fee right ? even if they dont say it, surely it still has to be there while you use it.

The only time this would be true is when the retailer charges an extra fee to cover their transaction fee, but this is a ripoff as its usually 2%-5% and they don't pay anywhere near that if they're big enough