Why are Credit Cards still charging such high interest rates in New Zealand?

February 15, 2009 by
Filed under: Banks, Cost of living, General Budgeting, Interest Rates, Credit Cards & Mortgages in NZ, The Book and Website 

Call me nuts, but I do wonder: if my mortgages are now at around 6% interest, and the official cash rate in New Zealand is down to an all-time low of 3.5%, why the hell is my Credit Card still carrying a whopping 20.5% interest rate???

mad
Now – before I beat the bank up mercilessly and without cause – I will in fairness say that the interest rate has dropped on the card. It used to be 20.95%. Let’s give credit where credit is due. Not.

Why is this important?

Well, an awful lot of people do not clear the balance on their credit cards each month – so for anyone in this situation – it is horrendous. Personally it doesn’t affect me: since I got my finances sorted I am able to pay off the balance in full and I do not pay interest on my credit card bill – and haven’t for over 4 years.

Do you have a balance on your Credit Cards that you are paying interest on? If you have – get it paid off as fast as you can. You might want to look at getting a new card and transferring the balance to lower the interest rate. Of course, because we are in New Zealand, that still means a hefty 5-10%, but it’s better than 20% charged on most cards. And you do have to remember that New Zealand banks can’t possibly cope without slapping fees on everything, so you will need to pay a yearly fee on the new card.

If you still have consumer debt and you have not started dealing with it – now is the time to make a start. With the financial crisis still ongoing – it pays to get your personal finances in order, and make sure you spend less than you earn. Avalon’s Guide contains two chapters on Debts one of which deals specifically with how to pay them off quickly and effectively.

wink
One of the best things we ever did was stop paying interest on credit cards. And with such ridiculously high rates here – I think it’s a good time to tell the New Zealand banks that this is unacceptable, and for everyone to do the same.

Rant over.

Related posts:

  1. I’m a credit card tart and proud of it!
  2. Paying off debt – still too hard for most people :(
  3. Arghhh – having to pay interest on the credit card!
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Comments

4 Comments on Why are Credit Cards still charging such high interest rates in New Zealand?

  1. » Why are Credit Cards still charging such high interest rates in New Zealand? on Sun, 15th Feb 2009 10:01 am

    2. [...] | MyBlogarama wrote an interesting post today onHere’s a quick excerptWhy are Credit Cards still charging such high interest rates in New Zealand? February 15th, 2009 Call me nuts, but I do wonder: if my mortgages are now at around 6% interest, and the official cash rate in New Zealand is down to an all-time low of 3.5%, why the hell is my Credit Card still carrying a whopping 20.5% interest rate??? Now – before I bet the bank up mercilessly and without cause – I will in fairness say that the interest rate has dropped on the card. It used to be 20.95%. Let’s [...]

  2. Interest Rates » Avalon’s Blog » Blog Archive » Why are Credit Cards still charging … on Sun, 15th Feb 2009 9:23 am

    3. [...] Read the rest of this great post here [...]

  3. Credit Cards Guide - Avalon’s Blog » Blog Archive » Why are Credit Cards still charging … on Sun, 15th Feb 2009 2:35 pm

    4. [...] Read more from the original source: Avalon’s Blog » Blog Archive » Why are Credit Cards still charging … [...]

  4. householdbank on Mon, 16th Feb 2009 10:48 pm

    5. Thank you, I love it. That is nice
    wamucards.com

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