28 June 2017

The dollarydo’s and don’ts of credit cards

When most people decide to get a new credit card, it’s with the best of intentions. You’ll often hear the words “emergencies only” while signing up, but sometimes this is followed months later by “there’s a sale on flights to Europe!”

It’s always a good idea to know your intentions when using your credit card. You should have a plan for how you want to use it, and things you want to avoid. To help, here are a few common dos and don’ts to look out for to best control your credit card spending.

Dollarydos

Pay your debt in full

It’s always best to be ahead of the game when it comes to credit card management. You should always prioritise paying your credit card bill in full each month. ING’s Orange One has on interest free period of up to 45 days, meaning if you pay your bill in full each month you’ll avoid extra debt adding up. If you find keeping up with your payments difficult, it may mean you’re spending more than you can afford. Set up and stick to a clear budget so you’re always prepared.

Recurring monthly payments

Monthly memberships, subscriptions and bills are a way of life these days. Whether it’s your gym membership, public transport top-up (Opal card, Go card or Myki card) or your mobile phone bill, using your credit card enables you to keep track of these expenses. By setting up automatic payments with your credit card, you’ll generally pay on time, every time. Keep in mind this only works when you pay back your card debt in full – you don’t want to be paying interest on these small expenses!

Pay more than your minimum

Though you should always aim to pay in full, if there ever is a circumstance where you can’t make the full payment, its good practice to pay more than the minimum repayment. Orange One has a 5% minimum payment per month, which helps you pay off your balance faster than some other cards. This also helps to save money on interest in the long run. Just remember if you can’t make the full payment consistently, have a look at your budget and spending habits, or contact your bank if you need assistance.

Instalment plans

You may be able to manage the purchases on your credit card by putting them on an instalment plan and paying them off over a set period of time. Orange One instalment plans are available for purchases $250 and above, and for terms between 3 months and 7 years (depending on the value of the instalment plan), and have a lower interest rate. But remember, you can always pay more to clear them off sooner and avoid unnecessary interest.

Contact the bank

If you’re ever in doubt about paying off your card, contact your bank. They’ll be able to help you out with the best steps forward.

 

Dollarydon’ts

Cash advances

While getting cash out from your credit card may be necessary in an emergency, you are better off withdrawing cash from your regular account. Cash advances (which also include other forms of quasi-cash transactions like the purchase of gaming chips and travellers cheques) can be expensive and the interest can quickly add up, as you are charged from the moment you withdraw the cash from the ATM. With most credit cards, you’ll incur a fee for withdrawal or account transfers and on top of that, interest on the amount is usually higher than normal and calculated daily from the first day. This will leave you with no grace period and less wiggle room to pay it off.

Don’t expect to ‘max’ your credit card

You’ve probably heard the term ‘maxed’ in regards to credit cards from somewhere and you could take a guess that it’s not a great thing. Maxing your credit limit isn’t something that should be considered an option, and you should check your balance often and always keep an eye on your spending habits through your credit card statement. Set an alert on your Orange One credit card so you’ll be notified when you’re approaching your limit.

Don’t spend more than you can afford

If you’re finding that you’re only able to make the minimum repayment this might mean you’re spending more than you can afford. Having a financial plan is a great way to ensure you never spend more than you can comfortably repay. Keep close to your budget so you can always cover your repayments and financial obligations while growing towards your goals.

Don’t be flippant with fraud

Just like you would keep your debit card safe, protect your credit card in the same way. Ensure you know where your card is at all times, never lend it or tell someone your pin, and keep an eye on your balance in case of any suspicious transactions. You can read more about security and how to protect yourself here.

Setting up good credit card habits is easier when you’ve found the card that suits your lifestyle. ING’s Orange One is now available to find out more about its features, you can visit here. 

Information and interest rates are current as at the date of publication and are subject to change. Limitations and exclusions apply to the establishment of instalments, including minimum purchase values, number and term of instalments. Interest free period available only where entire revolving balance plus monthly instalment amounts are repaid in the previous statement period. All applications are subject to ING’s eligibility and credit assessment criteria. Fees and charges apply. Any advice on this website does not take into account your objectives, financial situation or needs and you should consider whether it is appropriate for you. Before making any decision in relation to our products you should read the relevant Terms and Conditions, Fees and Limits Schedule, Key Facts Sheet, Credit Guide, Cashback Rewards Terms and Conditions and Complimentary Insurance Terms and Conditions available at ing.com.au. To view these documents you may need Adobe Acrobat. Products are issued by ING, a business name of ING Bank (Australia) Limited ABN 24 000 893 292 AFSL 229823, Australian Credit Licence 229823. Rebate Offers for Orange One and Orange One Platinum Customers.  The Global ATM Rebate Offer and the Foreign Currency Conversion Fee Rebate Offer will apply for the next calendar month when you perform the following during the current calendar month: – deposit at least $1,000 from an external bank account to any personal ING account in your name (excluding Living Super and Orange One), and also make at least 5 card purchases using your ING debit or credit card (excluding ATM withdrawals, balance enquiries, cash advances and EFTPOS cash out only transactions). Card purchases includes in store credit or EFTPOS purchases, online purchases, regular card payments, payWave, Apple Pay, and Google Pay transactions made with an Orange Everyday Visa card, Orange One or Orange One Platinum Visa card or Nil Interest Visa card provided with an eligible ING home loan. Card purchases made in store or online this current calendar month which settle next calendar month do not count towards the 5 card purchases needed this current calendar month. When determining if you are eligible under the offer, we also take into account the behaviour of any of your joint account holders or additional cardholders. If eligible: for ATMs in Australia – any ATM fee charged by the ATM operator is rebated immediately following the transaction, for ATMs outside Australia – ING will rebate the International ATM withdrawal fee of $2.50 immediately after it is charged and rebate any ATM fee charged by the ATM operator at settlement of the transaction. While the transaction is pending the amount of the acquirer fee will be deducted from your available balance and will be reinstated after the transaction is finalised. ATM transactions outside Australia can take up to 5 business days to finalise, and  – for ING international transaction fees. ING will rebate the Foreign Currency Conversion Fee of 2.5% of the amount of the international transaction immediately after it is charged. Merchants may charge you a separate fee for their services (which is not rebated under this offer). This offer may be changed or withdrawn at any time at ING’s sole discretion. The ING cash advance fee is not rebated under this offer. Apple Pay is a trademark of Apple Inc., registered in the U.S. and other countries. The Apple Pay Terms and Conditions for ING customers are available to consider when setting up Apple Pay on your eligible iOS device. Android Pay is a registered trademark of Google Inc. The Google Pay Visa Debit Card Terms and Conditions for ING customers are available to consider in the Google Pay app.

The information is current as at publication. Any advice on this website does not take into account your objectives, financial situation or needs and you should consider whether it is appropriate for you. Deposit products, savings products, credit card and home loan products are issued by ING, a business name of ING Bank (Australia) Limited ABN 24 000 893 292, AFSL and Australian Credit Licence 229823. ING Living Super (which is part of the ING Superannuation Fund ABN 13 355 603 448) is issued by Diversa Trustees Limited ABN 49 006 421 638, AFSL 235153 RSE L0000635. The insurance cover offered by ING Living Super is provided by Metlife Insurance Limited ABN 75 004 274 882, AFSL 238096. ING Home and Contents Insurance is issued by Auto & General Insurance Company Limited (AGIC) ABN 42 111 586 353 AFSL Licence No 285571 as insurer. It is distributed by Auto & General Services Pty Ltd (AGS) ABN 61 003 617 909 AFSL 241411 and by ING as an Authorised Representative AR 1247634 of AGS. All applications for credit are subject to ING's credit approval criteria, and fees and charges apply. You should consider the relevant Product Disclosure Statement, Terms and Conditions, Fees and Limits Schedule, Financial Services Guide, Key Facts Sheet and Credit Guide available at ing.com.au when deciding whether to acquire, or to continue to hold, a product. Before interacting with us via our social media platforms, please take a minute to familiarise yourself with our Social Media User Terms https://www.ing.com.au/pdf/Social_Media_User_Terms.pdf.

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