Money

Cashflow crisis for millions as credit cards become lifeline

Published

2 years ago

February 12, 2024

Ahron Young

A staggering number of Australians are resorting to credit cards to navigate financial hardships, reveals recent research conducted by Finder.

Finder’s Credit Card Report 2024 indicates that nearly half of credit card holders (44%) have made unplanned purchases on their cards within the past year, affecting approximately 4.6 million Aussies who found themselves unprepared for unexpected expenses.

Among these, nearly 750,000 individuals (7%) have resorted to credit cards after depleting their funds before payday, while one in five (21%) have been caught off guard by emergency expenditures.

Black Friday

Additionally, 14% admitted to overspending during sales events like Black Friday, further exacerbating their financial strain.

Amy Bradney-George, a credit card expert at Finder, underscores the impact of rising expenses and inflation on household budgets, driving many to rely on credit cards as a last resort.

“Persistently high inflation rates and aggressive interest rate hikes have taken a toll on finances, leaving many Australians with dwindling savings and credit cards as their sole lifeline,” Bradney-George explains.

Gender disparity

The data also reveals a gender disparity, with women (12%) being four times more likely than men (3%) to turn to credit cards due to insufficient funds before payday. Additionally, millennials are disproportionately affected, with a quarter (25%) admitting to relying on credit cards during emergencies over the past year.

In light of these findings, Bradney-George urges Australians to exercise caution with their spending and prioritize essential expenses. She advises those grappling with credit card debt to explore options such as transferring balances to cards offering introductory 0% interest rates on balance transfers.

“This allows individuals to repay their debt without incurring additional interest charges for a specified period,” Bradney-George explains. “However, it’s crucial to have a repayment plan in place to avoid accruing higher interest fees after the introductory period.”

For those facing financial stress, Bradney-George recommends reaching out to lenders for assistance or seeking guidance from free financial counseling services like the National Debt Helpline (1800 007 007).

As Australians navigate economic uncertainties, proactive measures and responsible financial management are essential to mitigate the impact of credit card reliance on household budgets.

Money

Fed cuts rates, signals more potentially ahead

Fed lowers rates amid job market concerns, signalling potential further cuts in upcoming meetings

Published

5 days ago

September 18, 2025

Ahron Young

Fed lowers rates amid job market concerns, signalling potential further cuts in upcoming meetings

In Short:
– The Federal Reserve cut interest rates by a quarter-point to address job market concerns.
– Officials expect at least two additional rate cuts by year-end amid ongoing economic uncertainties.

The Federal Reserve has reduced interest rates by a quarter-point, addressing concerns about a weakening job market overshadowing inflation worries.

A majority of officials anticipate at least two additional cuts by year-end during the remaining meetings in October and December.

Fed Chair Jerome Powell noted a significant shift in the labour market, highlighting “downside risk” in his statements.

The recent rate cut, supported by 11 of 12 Fed voters, aims to recalibrate an economy facing uncertainties from policy changes and market pressures.

Policy Dynamics

The decision comes amid intense political scrutiny, with President Trump openly criticising Powell’s reluctance to lower rates.

Despite the controversy, Powell asserts that political pressures do not influence Fed operations.

The current benchmark federal-funds rate now sits between 4% and 4.25%, the lowest since 2021, providing some reprieve to consumers and small businesses. Economic forecasts indicate ongoing complexities, including inflation trends and the impact of tariffs on labour dynamics, complicating future policy decisions.

Money

Fed faces unusual dissent amid leadership uncertainty

Fed’s Powell navigates contentious meeting amid Trump-appointed dissenters as rate cut looms and succession contest heats up

Published

5 days ago

September 17, 2025

Ahron Young

Fed’s Powell navigates contentious meeting amid Trump-appointed dissenters as rate cut looms and succession contest heats up

In Short:
– This week’s Federal Reserve meeting faces unusual dissent as Chair Powell approaches his term’s end.
– Analysts predict dissent over expected rate cuts due to political pressures from Trump-appointed officials.

This week’s Federal Reserve meeting is set to be particularly unusual, with Chair Jerome Powell facing significant disagreements over future policy as he approaches the end of his term in May.Tensions began before the meeting when Fed governor Lisa Cook won a court ruling allowing her to attend, despite opposition from President Trump, who is attempting to remove her.

The situation is further complicated by the recent swearing-in of Trump adviser Stephen Miran to the Fed’s board, following a Senate confirmation.

Analysts believe Powell may encounter dissent on an expected quarter-percentage-point rate cut from both Trump-appointed officials and regional Fed presidents concerned about inflation.

Potential Dissent

Trump has urged significant rate cuts and for the board to challenge Powell’s decisions.

Some analysts predict dissenting votes from Miran and other Trump appointees in favour of larger cuts. Federal Reserve veterans express concerns that political motivations may undermine the institution’s integrity, with indications that greater dissent could become commonplace.

Money

RBA plans to ban credit card surcharges in Australia

Reserve Bank of Australia plans to ban credit card surcharges despite banks warning of potential higher fees and weaker rewards

Published

6 days ago

September 16, 2025

ticker NEWS

Reserve Bank of Australia plans to ban credit card surcharges despite banks warning of potential higher fees and weaker rewards.

In Short:
– The RBA plans to ban surcharges on debit and credit card transactions, supported by consumer group Choice.
– Major banks oppose the ban, warning it could lead to higher card fees and reduced rewards for credit card users.

The Reserve Bank of Australia (RBA) intends to implement a ban on surcharges associated with debit and credit card transactions. Consumer advocacy group Choice endorses this initiative, arguing that it is unjust for users of low-cost debit cards to incur similar fees as credit card holders.

The major banks, however, are opposing this reform. They caution that the removal of surcharges could prompt customers to abandon credit cards due to diminished rewards.

A final decision by the RBA is anticipated by December 2025.