'Party is over' for consumer spending
As news of companies going to the wall continues to flood in and Australia teeters on the edge of a recession, JP Morgan’s money expert Stephen Walters has urged consumers to put their credit cards down.
Speaking to the Sydney Morning Herald, he said that many people will already be waking up to the realisation that the years of cheap credit card spending and rising personal debt levels have left the country dangerously in the red.
“We’re now entering a period where the desire will be to cut debt,” he told the paper.
“For some, this will be forced upon them by job losses.”
However, some advisers are optimistic that the raft of low-interest home loans entering the market present a number of decent opportunities to get bank accounts back into good health, with paying off credit cards identified as a priority for struggling Aussies.
As the new year has got underway, a number of experts have also been calling on credit card providers to drop their interest rates in line with four months of base rate cuts.