Credit card borrowing drops in January
New data from the Reserve Bank of Australia highlights that total credit and charge card balances outstanding declined by 1.6 per cent in January.
The amount owed on credit cards dropped from $46.912 billion in December to $46.152 billion, perhaps showing that people are being more cautious with their spending.
In total, Australians spent $17.18 billion on their credit cards in January, 22 per cent less than the previous month.
However, the figures are not seasonally adjusted and a fall is normal at the beginning of the year as people cut back after an expensive Christmas period.
Credit card repayments rose by 2.8 per cent year-on-year in January. However this was compared with an average annual growth rate of 8.9 per cent over the previous five years.
Last week, lifehacker.com.au advised that when deciding which credit cards to pay off first one with a high balance, or one with a high interest rate – people should work out which leaves them with the biggest bills and pay that one off in full first, rather than upping repayments on all cards.
This article is brought to you by Mozo – Helping you compare credit cards