Top ways to use your tax return this year
Monika Gudova
09 Aug 2018
Putting this year's tax return in your savings account seems like a no-brainer right? Well, with the average savings account offering up a return of just 1.79% p.a., Mozo research has shown there are some much better options for money savvy Aussies.
“We found depositing the average tax refund of $2,602 in a savings account with this 1.79% rate delivers a return of just $48 in interest a year- not much better than if you were to put it under your mattress,” said Mozo Data Manager, Peter Marshall.
So what should you do with your tax return windfall? We’ve broken down a couple of the best ways to use your tax return so you can watch your hard-earned money grow this year.
Make an extra repayment on your home loan
One way Aussies can save is by putting their tax refund towards their mortgage. By funnelling your tax refund into your mortgage you could save $230 in interest over the next year*. Over a 30 year loan, this would wind up saving you $6,895 in interest.
“Nearly one million Australian mortgage holders are now experiencing mortgage stress across the country,” said Marshall^.
“Using your tax refund as an extra repayment is a great strategy to build up a bit of a buffer within your mortgage when interest rates inevitably rise.”
Pay off credit card debt
With ASIC findings suggesting that as many as one in five Aussie cardholders are struggling with credit card debt, paying off a lingering balance with your tax return could be a way to get out of deep water.
Using your tax refund to pay the average credit card debt of $4,400 off a card collecting interest at 17.06%* could save you up to $344 over the year, helping you clear your card debt up to seven months earlier.
“For debt-holders receiving a tax refund this year, this could be the kick start they need to finally get their finances from the red into the black,” said Marshall.
If you’re tired of high interest rates and accumulating debt, check out some great deals to help you save below. Or, if you’d like to compare more options, head over to our credit card comparison tool.
*Calculations based on the average tax refund from the Australian Taxation Office Annual Report 2016/17. Annual credit card savings calculated are based on the average purchase rate of 17.06% and average credit card debt. Annual home loan repayment savings are based on an average $300,000, owner-occupier home loan. ^From Digital Finance Analytics: https://digitalfinanceanalytics...
Balance transfer credit card offers
Rates updated daily. Advertiser disclosure.
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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.
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20.74% p.a.
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0% p.a. for 28 months and then 20.99% p.a.
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20.99% p.a.
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55
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0.0
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3.30%
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$129 $0 in the first year
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$30.00
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2.7%, Min $2.70
Read our Mozo Review to learn more about the Virgin Australia Velocity Flyer Card - Balance Transfer Offer
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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.
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20.74% p.a.
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0% p.a. for 12 months and then 20.99% p.a.
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20.99% p.a.
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44
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3.30%
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$289
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$30.00
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2.7%, Min $2.70
Read our Mozo Review to learn more about the Virgin Australia Velocity High Flyer Card
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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.
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13.74% p.a.
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0% p.a. for 28 months and then 21.49% p.a. (1.00% balance transfer fee)
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21.49% p.a.
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55
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0.0
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3.00%
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$59 $0 in the first year
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$15.00
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3%
Read our Mozo Review to learn more about the Low Rate
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Great Southern Bank Low Rate Credit Card
0% p.a. for 33 months and then 21.74% p.a.
11.99% p.a.
$49 $0 in the first year
0% balance transfer rate for 25 months and up to 55 interest free days. No annual fee for the first year and $49 after. Mozo Experts Choice Balance Transfer Platinum Credit Card Winner 2020^
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11.99% p.a.
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0% p.a. for 33 months and then 21.74% p.a.
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21.74% p.a.
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55
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0.0
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3.40%
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$49 $0 in the first year
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$12.50
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2.00%, Min $3.50
Read our Mozo Review to learn more about the Low Rate Credit Card
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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.
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0% p.a. for 15 months then 9.90% p.a.
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0% p.a. for 15 months
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0% p.a. for 15 months and then 9.90% p.a.
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21.99% p.a.
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55
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0.0
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2.95%
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$49 $0 in the first year
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$25.00
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2%, Min $4.00
Read our Mozo Review to learn more about the Breeze Mastercard
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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.
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13.99% p.a.
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-
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0% p.a. for 32 months and then 21.49% p.a.
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21.49% p.a.
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55
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0.0
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3.00%
-
$55 $0 in the first year
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$15.00
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3%
Read our Mozo Review to learn more about the Vertigo - Balance Transfer Offer
Details Close
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Apply By 24 February 2022
BankSA 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.
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13.99% p.a.
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-
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0% p.a. for 32 months and then 21.49% p.a.
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21.49% p.a.
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55
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0.0
-
3.00%
-
$55 $0 in the first year
-
$15.00
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3%
Read our Mozo Review to learn more about the Vertigo - Balance Transfer Offer
Details Close
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HSBC Platinum Credit Card
0% p.a. for 36 months and then 21.99% p.a.
19.99% p.a.
$129 $29 in the first year
0% p.a. on balance transfers for 36 months with no balance transfer fee. Terms and Conditions apply. Mozo Experts Choice Premium Rewards and Balance Transfer Platinum Credit Card Winner 2020.
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19.99% p.a.
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0% p.a. for 36 months and then 21.99% p.a.
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21.99% p.a.
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55
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29.0
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3.00%
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$129 $29 in the first year
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$30.00
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3%, min $4.00
Read our Mozo Review to learn more about the Platinum Credit Card
Details Close
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Apply By 24 February 2022
St.George 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.
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13.99% p.a.
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0% p.a. for 32 months and then 21.49% p.a.
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21.49% p.a.
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55
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0.0
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3.00%
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$55 $0 in the first year
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$15.00
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3%
Read our Mozo Review to learn more about the Vertigo - Balance Transfer Offer
Details Close
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NAB Low Rate Card
0% p.a. for 32 months and then 21.74% p.a. (0% balance transfer fee)
12.99% p.a.
$59 $0 in the first year
0% p.a. interest on balance transfers for the first 32 months, plus a low ongoing purchase rate after that means you can spend with confidence. There's also up to 55 interest free days on purchases to help you manage your budget better.
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12.99% p.a.
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0% p.a. for 32 months and then 21.74% p.a. (0% balance transfer fee)
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21.74% p.a.
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55
-
0.0
-
3.00%
-
$59 $0 in the first year
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$15.00
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2%, Min $2.50
Read our Mozo Review to learn more about the Low Rate Card
Details Close
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^See information about the Mozo Experts Choice Credit cards Awards
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