Two days ago the Reserve Bank of Australia (RBA) lowered the borrowing rate 100 points, ie. 1% to try and stave off the burden of the world wide financial crisis. A number of banks quickly reacted by lowering their home loan rates up to 80 points, ie. 0.8%. People across Australia cheered at the step taken by the RBA, and jeered the banks for not passing on the full 1%.
No one mentioned credit card interest rates at all
I heard a statistic on Sky News Australia this morning, on any given day Australian banks make approximately 1 million dollars on credit card interest alone. Holy crap that’s a lot of money. That’s 365 million a year, just on interest. This doesn’t include card fees, account keeping fees, any other fees, just interest alone!
I’m not going to be some sort of twat and complain that we’re all in so much debt and it’s the banks fault and wah wah wah, I have a credit card myself and it’s often at the limit, we only have our selves to blame. However what I will say is that while all the banks are helping ease the weekly burden on families by reducing home loan interest rates, why don’t you guys have a quick squizz at the ridiculous interest rates you’re charging on credit cards and lower them a percent or two. Yes I understand that it is an unsecured loan, and therefore a lot riskier, but come on I can get an unsecured personal loan up to $75,000.00 at 13.74% compared to say $10,000 credit card limit at up to 20.45%.
If there is one lesson I’ve learnt from this financial crisis it’s this;
Get rid of your credit cards, go back to basics.
If you have cash you can buy stuff, if you don’t then you have to wait till you do.
It’s not the end of the world if you can’t have that new tv, phone, computer, game, whatever, etc. now.