The season of giving may be fast approaching with Christmas just six weeks away, but that doesn’t mean you need to extend that generosity to forking over excessive interest and fees when you’re paying for presents this year.
New research from Mozo.com.au has revealed that Aussie Christmas shoppers could end up paying up to $934 in interest and fees in the New Year depending on their payment method, with the research predicting an average December household credit card spend of over $3,700.*
“For many households, turning to loans or credit cards may seem the only option to cover the cost of Chritsmas, but choosing the wrong payment method can add 25% to the cost of Christmas,” said Mozo Director Kirsty Lamont.
Payday loans top the list of the worst ways to pay for Christmas, with interest rates of above 45% and hefty establishment fees adding a whopping $934 in cost to the average silly season spend.
Putting Christmas on a typical credit card will add $309 in interest and fees to the average festive spend, while a typical unsecured personal loan comes in third on the list at a cost of $300.
But if you have to whip out the plastic, using a 0% purchase rate credit card was found to be the best value way to pay for festive shopping - costing just $68 in total interest and fees on the average $3,744 Christmas household spend.
If you're looking for a cost-effective way to help spread the cost of festive shopping, here are some 0% purchase rate credit card and low rate personal loan options.