Credit card or personal loan? How the two stack up when paying for your Christmas trip home

For many Aussies, Christmas involves a trip home to visit loved ones.

And whether you’ve left it to the last minute or are well ahead of time, there’s always the question of how to pay for it - either putting travel costs on your credit card or taking out small personal loan.

But since many trips don’t necessarily cost an arm and a leg, it can be tricky to know which option to choose.

Both come with their benefits and drawbacks, which you’ll need to sift through before picking the right choice for you.

To help, we’ve jotted down some of the things you will need to consider when tossing up between a credit card and a personal loan.

Credit card


  • Flexibility in repayments - If you’re someone who prefers to make payments one month and then skip the next, then a credit card provide you with that flexibility. However, you should keep in mind that carrying a balance does mean you’ll have to pay interest on your purchases, which can add up over time.

  • Option to pay zero interest - Some cards come with an interest-free period when you first apply, meaning you won’t have pay any interest when your bill arrives.


  • Higher rates - Depending on your plastic, many credit cards come with higher interest rates, compared to a low rate personal loan.

  • The revert rate - While paying no interest on your plastic might sound like a big win, once the ‘honeymoon’ period ends, your card may revert to a high interest rate.

Personal Loans


  • Easier to budget for - A personal loan comes with set repayments that must be met on either a weekly, fortnightly or monthly basis. And if you opt for a fixed rate, you’ll always know your repayment amount, so you can work it into your monthly budget.

  • Lower interest rates - Generally, personal loans come with lower interest rates than credit cards.


  • Tricky to pay out loan early -  If you are choosing a fixed rate personal loan, some providers may charge a hefty break cost fee.

  • May have to offer security - While secured personal loans generally come with lower interest rates, you will have to offer up an asset, like your car, to be used as security against the loan. This gives the provider the right to repossess your vehicle if you ever default on the loan.

Thinking a personal loan might be the right option for you this Christmas? You can check out some personal loan deals down below or jump onto our personal loan comparison tool for more options.

* 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

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