Covid-19 is the financial “wake up call” Aussies need, says Mozo

Ceyda Erem

14 Jul 2020

Down with debt content

Over the last few months, we’ve seen the Covid-19 pandemic affect all aspects of day-to-day life, from grocery shopping to heading into work. 

But according to new Mozo research, it seems like it may have had a positive impact on the way we think about debt. 

Before the pandemic hit, a considerable 67% of Aussies believed that debt was a ‘necessary part of everyday life’, but now one in four are reportedly working toward erasing debt for good. 

“Historically, Australians haven’t been afraid of debt, particularly through our love of credit cards. We’ve racked up debt with the assumption that job security and a steady paycheck is a relatively safe bet, but a global pandemic has tipped that notion on its head as unemployment soars,” said Mozo Director, Kirsty Lamont. 

“For many people, Covid19 has been a wake up call to get their finances in order, and eliminating debt is a key part of that.” 

Mozo found that 68% of Australian households currently have some form of personal debt, like a credit card or personal loan, while 73% of those with debt are concerned about the level it has reached, with one in five unsure how they will repay it. 

Other financial goals Aussies are keen to work on include building an emergency savings fund, spending less on non-essentials and no longer spending beyond their means. 

Taking the first step toward banishing credit card debt 

Although credit card balances have fallen by 8.5% in the last two years and the average balance sits under $2,000, many Aussies may be in the dark about making their first move. 

One option may be to take out a balance transfer credit card. These allow you to transfer the balance of your current credit card onto another with a 0% interest rate for a certain period of time. This potentially allows Aussies to save a bundle in interest. 

In fact, following a Mozo number crunch using the average credit card debt ($4,200) and a typical interest rate of 16.88%, a balance transfer card with a 0% interest rate could deliver savings of up to $560 over 12 months.

However Lamont has warned that in order for a balance transfer card to be effective, Aussies will need to have a repayment plan in place to avoid being stung by interest. 

“While balance transfer cards are a great way to put all your debt in one place, it’s crucial for you to use a card with an interest free period that is attainable. It pays to be aware that you can be hit with some massive interest price hikes after the interest free period,” said Lamont.

If you’d like to find out more about how balance transfer credit cards work, check out our handy guide

Or if you’re ready to eradicate your credit card debt once and for all, head on over to our balance transfer credit card comparison tool!

Compare balance transfer credit cards

Rates updated daily. Advertiser disclosure.

  • Virgin Money Virgin Australia Velocity Flyer Card - Balance Transfer Offer

    0% p.a. for 28 months and then 20.99% p.a.

    20.74% p.a.

    $129 $0 in the first year

    Get in the air with a $129 Virgin Australia Gift Voucher each year. 0% p.a. for 28 months on balance transfers.

    • 20.74% p.a.

    • -

    • 0% p.a. for 28 months and then 20.99% p.a.

    • 20.99% p.a.

    • 55

    • 0.0

    • 3.30%

    • $129 $0 in the first year

    • $30.00

    • 2.7%, Min $2.70

    Read our Mozo Review to learn more about the Virgin Australia Velocity Flyer Card - Balance Transfer Offer

    Details Close

  • Virgin Money Virgin Australia Velocity High Flyer Card

    0% p.a. for 12 months and then 20.99% p.a.

    20.74% p.a.

    $289

    Earn up to 100,000 bonus Velocity Points (minimum spend applies) plus snag a $129 Virgin Australia Gift Voucher and two free Virgin Australia domestic Lounge passes each year to kickstart your travel adventures.

    • 20.74% p.a.

    • -

    • 0% p.a. for 12 months and then 20.99% p.a.

    • 20.99% p.a.

    • 44

    • 3.30%

    • $289

    • $30.00

    • 2.7%, Min $2.70

    Read our Mozo Review to learn more about the Virgin Australia Velocity High Flyer Card

    Details Close

  • Westpac Low Rate

    0% p.a. for 28 months and then 21.49% p.a. (1.00% balance transfer fee)

    13.74% p.a.

    $59 $0 in the first year

    Enjoy a super low rate of 13.74% with 55 days interest free plus 0% balance transfer for up to 28 months at 1% BT fee. No annual card fee for the first year, $59 thereafter. New Cards only. Offer ends February 24th 2022. T&C's and exclusions apply.

    • 13.74% p.a.

    • -

    • 0% p.a. for 28 months and then 21.49% p.a. (1.00% balance transfer fee)

    • 21.49% p.a.

    • 55

    • 0.0

    • 3.00%

    • $59 $0 in the first year

    • $15.00

    • 3%

    Read our Mozo Review to learn more about the Low Rate

    Details Close

  • Bankwest Breeze Mastercard

    0% p.a. for 15 months and then 9.90% p.a.

    0% p.a. for 15 months then 9.90% p.a.

    $49 $0 in the first year

    Enjoy 0% p.a on balance transfers for 15 months then 9.90% thereafter. No annual fee for the first year. Limited time only. Other fees, T&Cs apply. New Breeze Mastercard customers only.

    • 0% p.a. for 15 months then 9.90% p.a.

    • 0% p.a. for 15 months

    • 0% p.a. for 15 months and then 9.90% p.a.

    • 21.99% p.a.

    • 55

    • 0.0

    • 2.95%

    • $49 $0 in the first year

    • $25.00

    • 2%, Min $4.00

    Read our Mozo Review to learn more about the Breeze Mastercard

    Details Close

  • Apply By 24 February 2022

    Bank of Melbourne Vertigo - Balance Transfer Offer

    0% p.a. for 32 months and then 21.49% p.a.

    13.99% p.a.

    $55 $0 in the first year

    0% p.a. for 32 months on balance transfers requested at card application. 0% balance transfer fee applies. Rate then switches to applicable variable cash advance rate. No annual fee for the first year, $55 thereafter. New cards only, Eligibility criteria and T&Cs apply. Offer ends February 24th 2022.

    • 13.99% p.a.

    • -

    • 0% p.a. for 32 months and then 21.49% p.a.

    • 21.49% p.a.

    • 55

    • 0.0

    • 3.00%

    • $55 $0 in the first year

    • $15.00

    • 3%

    Read our Mozo Review to learn more about the Vertigo - Balance Transfer Offer

    Details Close

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