Is a credit card right for you?

Credit cards can have a number of advantages if they’re used wisely. It's a good idea to look at the pros and cons to see if they're right for you.

Credit cards can be a convenient way to spend when you need to and pay back later, and as a backup when you’re travelling. They can be useful in emergencies and many also offer great rewards and other benefits. But they can also have some downsides that you need to be aware of before applying for one.

In this article we’ll look at some of the benefits and potential pitfalls, to help you decide whether a credit card could be a good option for you.

When a credit card can be great


It’s reassuring to have access to a credit card in emergencies – for example if you need to pay for an urgent flight home for you or a family member, and you have a plan to repay it.

Interest-free days

Many cards offer interest-free days, which means you effectively have access to interest-free credit on purchases for a short time – as long as you pay your card off in full by the due date each month. 

Other benefits

Some cards offer additional benefits such as Airpoints or cash back.

When a credit card may not be right for you

You don’t pay off your credit card in full every month

If you don’t pay your balance in full each month, you’ll pay interest. Even if you pay some of your balance, you’ll still pay interest. It pays to have a plan in place so that you can always repay the balance in a short time period, to avoid paying more interest than you need to. 

You use it for impulse purchases, or ‘wants’ rather than needs

Having access to credit can be very tempting. So if you think you’ll find it hard to avoid those temptations, a credit card may not be for you. If you use it to buy things you haven’t budgeted for your balance can quickly mount up and make it difficult to pay off – which means you’ll incur interest that could make that ‘bargain buy’ more expensive than you thought.

What’s the best credit card for you?

If you’ve weighed it up and believe a credit card could be right for you, the next step is to decide what type of card. It all depends on your situation and what’s important to you. For example, do you want a card that offers rewards or one with a low annual fee? If you travel overseas a lot, you may want a card that offers overseas travel insurance. Need help? Talk to your bank to find out what options you have.

Important information

The information is current as at August 2020 and may be subject to change.

Information in this article refers to personal credit cards, is general in nature only and does not take into account your personal objectives, financial situation or needs. The information may not reflect how interest and charges are calculated under your credit card conditions of use. We recommend you review your personal credit card conditions of use for information about the terms that apply to you.

Talk to us for financial advice and see our advice statement.

Lending criteria, terms and fees apply to all ANZ credit cards. See Rates, fees and agreements for more information.