Aussies paying back home loans and credit cards this Christmas

Aussies are going to be paying off their home loans and cheap credit cards this Christmas instead of hitting the shops, according to a new study.

The Loan Market Group conducted a survey that found 56 per cent of people are planning on cutting down on how much they spend over the festive season.

Instead they plan on giving a boost to their home loans and credit card repayments, the study indicated.

Meanwhile, 14 per cent said they would be asking for money as a gift – perhaps to give a boost to their savings accounts.

The Reserve Bank of Australia’s confidence in the economy, as expressed in Wayne Swan’s recent justification for the base rate hike, may have encouraged some to splash out, however.

Some 30 per cent of those questioned said economic optimism has encouraged them to push the boat out.

But Dean Rushton, Loan Market Group chief operating officer, warned that the base rate rise may mean "party over" for Aussies.

"This Christmas looks like being a fairly subdued one," he said.

"Higher interest rate for many people will mean less money to spend this Christmas."

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