3 in 5 Aussies miss the mark when repaying holiday credit card debt, Experian research finds

By Katherine O'Chee ·

Back from an overseas trip, only to find you now have thousands of dollars of debt hanging over your head? Experian’s new research has revealed three in five Aussies who used their credit card during their holiday didn’t pay it off immediately after they returned home. 

Young Aussies are among the biggest culprits of outstanding holiday debt. In fact, four in five of respondents aged 25-34 said they took anywhere between one month to two years to repay their vacation credit card balance.

Meanwhile, more than half of all respondents said they spent up to $4,000 on their credit card for their holiday, with most using their card to splurge on accommodation (41%), travelling to and within destinations (39%) and experiences (34%). 

Experian’s survey found 16% hit their credit card limit while on vacation, the majority being in that younger age bracket. 

RELATED ARTICLE: New report reveals the cost of travel is the biggest worry for Aussie first-time travellers

According to Experian Executive General Manager of Credit Services & Decision Analytics A/NZ, Poli Konstantinidis, many young Aussies aren’t thinking longer term and bigger picture when it comes to their finances. 

“It’s easy to get swept up in the splendour of a holiday but it’s important to make informed decisions when spending on credit cards, so as not to end up with unmanageable debt upon return and a case of post-holiday blues,” Konstantinidis said.

“Australian consumers, particularly in the younger age bracket of 25-34 who may well be looking into purchasing their first home in the near future, need to be aware of the long-term implications of lingering holiday credit card debt.” 

Sayonara, holiday debt! 

Thankfully, it’s not all doom and gloom. If you used your credit card to pay for holiday expenses like many other Aussies, and now you’re stuck in a rut of trying to keep up with expensive monthly repayments, a great way to lower those repayments and pay off debt more quickly is to refinance to a debt consolidation loan

This is a great strategy if you’ve run up a balance on multiple credit cards, or used a credit card in combination with a personal loan. By combining all of your debt into one debt consolidation loan, you’ll find it much easier to manage and stay on top of your repayments, since the debt is all in one place. What’s more, you’ll be able to save heaps on interest costs, as you’ll only have one (usually much lower) interest rate for multiple debts, instead of one per debt. 

Here's an example to illustrate just how much you be saving. 

Let’s say you ended up with the following debt after your holiday abroad:  

  • $4,000 credit card balance with a 19% interest rate and no annual fees. If you were making monthly repayments of $150, you’d pay $1,238 in total interest and it would take you just under 3 years to clear the debt - that’s if you stop spending on the card all together!
  • $5,000 personal holiday loan with a 7% interest rate, paid back over 3 years. That’s another monthly repayment of $154 and $558 total in interest. 

This totals to $304 in monthly repayments and $1,796 in interest over three years. But if you took out a debt consolidation loan with an 8% interest rate, your monthly repayments would drop down to $282 and you’d be paying $1,153 total in interest over three years instead, saving you $643 in interest!* 

Going on holiday soon? Head over to our travel hub to find the latest travel articles to help you prepare for your big trip. And be sure to check out our debt consolidation comparison tool to find a refinance loan deal that suits you.


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Katherine O'Chee
Money writer

Katherine O’Chee is Mozo’s international money transfer and forex expert and business banking writer. She keeps Mozo’s readers on top of the latest news and writes in-depth features to inform and help Australians make smarter financial decisions. Her work has been published in major media outlets including Sydney Morning Herald, SBS News and Bangkok Post. She has a Bachelor of Arts (Media and Communications) from the University of Sydney.