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

By Katherine O'Chee · · 5 min read
Fact Checked
Advertiser disclosure

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.


Compare debt consolidation loans

Mozo may receive payment if you click products on our site. We don’t compare the entire market, but you can search our database of 234 personal loans.
Last updated 24 November 2024 Important disclosures and comparison rate warning*
  • Debt Consolidation Loan

    $5,000-$75,000

    interest rate
    comparison rate
    Monthly repayment
    6.57% p.a.to 18.99% p.a.
    7.19% p.a.to 19.39% p.a.based on $30,000
    over 5 years

    Competitive fixed rates on loans up to $75,000 depending on your credit score. Zero monthly account keeping fees, no exit fees and no early repayment fees. Make weekly, fortnightly or monthly repayments, over 1 to 7 years managed entirely online, at any time. Fast and easy, 100% online application.

    Repayment terms from 1 year to 7 years. Representative example: a 5 year $30,000 loan at 6.57% would cost $35,528.12 including fees.

    Compare
    Go to site
    Details
  • Unsecured Personal Loan

    Fixed

    interest rate
    comparison rate
    Monthly repayment
    6.75% p.a.to 26.95% p.a.
    6.75% p.a.to 26.95% p.a.based on $30,000
    over 5 years

    Borrow up to $50,000 unsecured. Perfect if you earn more than $22,100 p.a. and have good to excellent credit. Multi-year winner of Mozo’s Experts Choice Unsecured Personal Loan Award, 2021, 2022, 2023 & 2024^'

    Repayment terms from 2 years to 7 years. Representative example: a 5 year $30,000 loan at 6.75% would cost $35,430.23 including fees.

    Compare
    Go to site
    Details
  • Low Rate Personal Loan

    Excellent Credit, $5,000 - $75,000

    interest rate
    comparison rate
    Monthly repayment
    6.57% p.a.to 8.39% p.a.
    7.19% p.a.to 8.75% p.a.based on $30,000
    over 5 years

    Competitive low rates for borrowers with excellent credit on 1-7 year loans from $5,000 up to $75,000, plus free extra repayments. Winner of Mozo's Experts Choice Excellent Credit Unsecured Personal Loan 2024 and Excellent Credit Secured Personal Loan 2024 awards ^. Min. income of 25k after tax, to apply.

    Repayment terms from 1 year to 7 years. Representative example: a 5 year $30,000 loan at 6.57% would cost $35,528.12 including fees.

    Compare
    Go to site
    Details
  • Unsecured Personal Loan

    Fixed

    interest rate
    comparison rate
    Monthly repayment
    5.76% p.a.to 24.03% p.a.
    6.55% p.a.to 24.98% p.a.based on $30,000
    over 5 years

    Fast, easy and 100% online, this is a low cost loan with no ongoing fees or extra repayment penalties. It's perfect for savvy borrowers with great credit. If you’re over 18 and earn above $30,000, you could qualify (other eligibility criteria may apply).

    Repayment terms from 3 years to 7 years. Representative example: a 5 year $30,000 loan at 5.76% would cost $35,173.52 including fees.

    Compare
    Find out more
    Details
  • Debt Consolidation Loan

    interest rate
    comparison rate
    Monthly repayment
    5.76% p.a.to 24.03% p.a.
    6.57% p.a.to 24.99% p.a.based on $30,000
    over 5 years

    Roll multiple debts into one loan to streamline your finances with one set of repayments and one interest rate. Competitive fixed interest rates with no monthly or early repayment fees and flexible repayment options. Easy online application and funding in as little as 24 hours (subject to approval).

    Repayment terms from 3 years to 7 years. Representative example: a 5 year $30,000 loan at 5.76% would cost $35,173.52 including fees.

    Compare
    Find out more
    Details

*Calculations as of 20 August 2019

* WARNING: The Comparison Rate combines the lender's interest rate, fees and charges into a single rate to show the true cost of a personal loan. The comparison rates displayed are calculated based on a loan of $30,000 for a term of 5 years or a loan of $10,000 for a term of 3 years as indicated, based on monthly principal and interest repayments, on a secured basis for secured loans and an unsecured basis for unsecured loans. This comparison rate applies only to the example or examples given. Different amounts and terms will result in different comparison rates. Costs such as redraw fees or early repayment fees, and cost savings such as fee waivers, are not included in the comparison rate but may influence the cost of the loan.

^See information about the Mozo Experts Choice Personal Loan Awards

Mozo provides general product information. We don't consider your personal objectives, financial situation or needs and we aren't recommending any specific product to you. You should make your own decision after reading the PDS or offer documentation, or seeking independent advice.

While we pride ourselves on covering a wide range of products, we don't cover every product in the market. If you decide to apply for a product through our website, you will be dealing directly with the provider of that product and not with Mozo.

Compare personal loans