With just nine weeks until Christmas, people should use their credit cards wisely to avoid starting 2010 with a debt hangover, a leading credit union says.

Credit Union Australia chief executive Chris Whitehead said making a budget and planning for payments after the festive season was over could prevent people being left with a significant burden on their credit card.

“Many shoppers use credit cards to make their Christmas purchases - thinking they can pay the balance off in the new year,” Mr Whitehead said.

“Unfortunately, when the interest-free period ends, people find day-to-day expenses have mounted or interest rates and home repayments have risen and they are unable to service the accumulated debt leaving leaving them suddenly financially overcommitted.
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Australians should use their tax return to reduce debt rather than spending it frivolously, the nation’s largest credit union says.

Credit Union Australia (CUA) acting chief executive Rob Nicholls said consumers should repay existing debt in the current economic climate or invest the tax return for future growth.

“While those shoes or new pair of jeans may be a `must have’ today, there are better ways to spend a tax return that could provide you with an endless shoe or jeans collection in years to come,” Mr Nicholls said.

There were obvious ways for Australians to use their tax return including to reduce debt, Mr Nicholls said.
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