Compare some of the best credit cards in Australia

There is no one “best” credit card in Australia, as there is such a large variety of credit card types and uses in the market.

To find your best credit card, you may want to look at your income, expenses, and the type of cardholder you are. Then, think about exactly what you want to use the credit card for to help narrow down your best credit card search. 

Habitual spenders 

You use your credit card like a debit card and are constantly racking up interest on your outstanding balance.

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Occasional/emergency spenders 

You use your credit card as a helpful financial tool and don't rely on it for everyday spending. You're only bringing it out for large purchases you otherwise couldn't afford in one go, in emergencies, or just when travelling/shopping online on overseas websites, and pay back this debt over time.

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Everyday spender 

You use your credit card every day for purchases like groceries or to pay bills. You may do so to maximise the amount of rewards points you could earn. Compared to the habitual spender, you ensure your credit card balance is always paid in full each statement period. 

Suggested cards - Low rate credit card, low fee credit card, rewards credit card, frequent flyer credit card, travel credit card

Big spender 

You are a higher income earner and put over $5,000 a month on your credit card. You may use your credit card for convenience or to try and earn rewards points and game point hacks. You are strict about paying off your balance in full to avoid interest charges.

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The best way to find the right credit card for you is to do your research and compare your options carefully. Use comparison tools, such as tables and calculators, to help you in this process.

1. Check credit card comparison tables: Comparison tables allow you to compare apples with apples. You can filter down and sort from the options shown based on what you're looking for, such as card type, purchase rate, number of interest free days, and annual fees. This will help you to find the best credit card for your needs from RateCity's top pics. You'll also get a clear indication of any features and perks linked to the new credit card.
2. Make a check list of the cards you're considering: Once you've narrowed down your search, it’s worth making a short list of potential cards and carefully looking at each card's PDS, key fact sheet or equivalent document.
3. Check the eligibility criteria: Once you've settled on a choice, triple check the eligibility criteria set by the credit card provider before you begin your card application. If you don't meet the card issuer's criteria, you may not get card approval and be rejected. This can seriously hurt your credit score and will be noted in your credit history.

Credit cards can be a helpful financial tool but when misused can result in you accruing debt. Maxing out your credit limit and having too much credit card debt will also hurt your credit score.

When deciding on the best credit card for your budget, a general rule of thumb is to aim for one that keeps fees and charges down. These costs can add a lot to your bill, and may result in you accumulating debt. Some common charges include:

• Annual fees
• Late payments fees
• Cash advance rate
• Fees for exceeding your credit limit
• Foreign transaction fees

However, not all credit card fees are considered bad. In fact, if you opt for a credit card with a rewards program, it's generally accepted that you will pay a little more in annual fees or interest rates for the benefit. These costs help to pay for the rewards, and may be unavoidable for this type of card.

For a full breakdown of any potential fees, read the Product Disclosure Statement (PDS) and terms and conditions linked to your credit card. It's crucial that you’re aware of these charges so that you can budget accordingly. The PDS will also have a breakdown of the earn rate on rewards programs.

Credit cards can be a handy asset when you don’t have the cash reserves to make a big purchase, when you're travelling overseas; and when you want to earn bonus points for your everyday spending. But that convenience can also come with a cost. This is why it’s crucial you understand the pros and cons of credit cards before you sign on the dotted line.