Let's be honest—staring at multiple credit card statements, BNPL reminders, and personal loan notices feels like drowning in quicksand. The harder you thrash, the deeper you sink. But here's the thing: thousands of Australians dig themselves out every year, and they're not financial wizards. They just know which levers to pull.
You. Yes, you—the one juggling three credit cards while that Afterpay notification just pinged your phone. Maybe you're asking yourself: "What's actually the fastest way to torch this credit card debt?" Or perhaps: "Should I roll everything into one loan and be done with it?"
Good questions. Real answers coming.
Forget the fluff. Here's what works:
Picture this: credit card interest averaging 20.99% p.a. according to Finder's RBA data. Meanwhile, Money.com.au reckons the actual rate charged on outstanding balances sits around 18.80% p.a.
And we're not talking pocket change here. Australians hold 12.15 million credit card accounts with total balances hitting $41.96 billion. Average balance per account? A hefty $3,454.
Translation? Every extra dollar you throw at the principal—especially at these eye-watering rates—can shave months off your sentence.
Grab a coffee. Open a spreadsheet. List everything: balance, interest rate, minimum payment, due date, sneaky fees. Credit cards, personal loans, BNPL, that parking fine you're pretending doesn't exist.
Here's where it gets interesting: connect everything to a finance app so it's all visible in one hit. The WeMoney app lets you link accounts, categorise spending, and set debt goals—watching that progress bar climb becomes oddly addictive.
Already behind? Don't spiral. Ring your lender for hardship assistance or dial the National Debt Helpline on 1800 007 007 (free, confidential, zero judgment). ASIC's Moneysmart has step-by-step guides too.
Two schools of thought here, and both have merit:
Debt snowball: Pay minimums everywhere, then unleash hell on the smallest balance. Quick wins = dopamine hits = you keep going.
Debt avalanche: Pay minimums everywhere, then carpet-bomb the highest interest rate. Mathematically optimal, emotionally... slower.
Snowball lovers celebrate early victories—perfect when you've got multiple small debts nagging at you. Sure, you might pay slightly more interest overall, but momentum matters more than maths if it keeps you consistent.
Avalanche disciples save the most money long-term. But watching that 20% credit card balance crawl down while smaller debts mock you? That takes discipline.
Choose based on your personality, not what some finance guru preaches.
Here's the deal: rolling multiple high-interest debts into one fixed-term personal loan can work brilliantly. Emphasis on "can."
Your new rate (including the comparison rate—that's the real number) beats your weighted average credit card rates by a meaningful margin. And you're picking the shortest term you can stomach, not stretching it out for lower monthly payments.
Most importantly? You're closing or slashing limits on those consolidated cards. Otherwise, you're just creating space for more debt. Ask me how I know.
According to Moneysmart's guidance, extending your loan term can mean paying more interest overall—even at a lower rate. And if you keep using those old cards? You'll end up worse than where you started.
WeMoney surfaces personalised consolidation loan offers from Australian lenders, letting you compare rates and fees without the tab-explosion. Their members improve credit scores by an average of 63 points in the first 9 months—better scores unlock better rates.
Zero percent for 24 months sounds dreamy, right? It can be—if you're disciplined enough to actually use that window.
Here's how to make it work, per ASIC's Moneysmart:
Not ideal if you're already behind on payments or lack the discipline for a strict payoff plan. Consider consolidation instead.
Paying only minimums? Moneysmart shows this can trap you for years, bleeding thousands in interest.
The fix: automate a fixed amount above minimum, scheduled for the day after your salary lands. Set it and forget it. Use your bank's calculator to pick a target date and monthly amount that actually gets you there.
Time for tough love. Press pause on everything non-essential: streaming services you forgot about, that third coffee, the weekend Uber Eats spiral.
Quick wins Aussies consistently find:
WeMoney auto-detects recurring charges and flags zombie subscriptions—those $14.99 monthly vampires add up fast.
Ring your card provider. Ask for a lower rate. Request fee waivers. If struggling, mention hardship support.
They want you to pay successfully—defaulting helps nobody. You'd be surprised what a five-minute conversation can achieve.
Ask your bank to slash credit limits to bare minimum. As you pay off cards, close them. Ceremonially cut them up if it helps.
Keep one low-rate emergency card if absolutely necessary—then freeze it in a block of ice. Literally.
Even a modest $500-$1,000 buffer stops car repairs or dental emergencies becoming new credit card debt. Park it in a separate high-interest savings account. Label it "Break Glass in Emergency."
Watching utilisation drop and on-time payments stack up? That's dopamine gold. Plus, it's rebuilding your credit score for future you.
WeMoney tracks your free credit score with trend charts alongside debt balances—seeing both lines move in the right direction keeps you hungry.
No shame in needing help. The National Debt Helpline (1800 007 007, Mon-Fri) offers free, confidential financial counselling. They'll even negotiate with creditors for you.
ASIC's Moneysmart has plain-English guides covering everything from balance transfers to bankruptcy alternatives.
Qualify for a much lower fixed rate and want one predictable payment? Consolidation loan might be your move—but close those old cards.
Can clear everything in 6-24 months with military discipline? Balance transfer could work—just don't touch that new card for purchases.
Want the absolute lowest interest cost? Avalanche method. Need quick wins to stay motivated? Snowball all day.
Already behind or overwhelmed? Call the National Debt Helpline before applying for new credit. Seriously.
Say you've got $5,000 on a card at 20.99% p.a., paying $250 monthly. That's roughly 24 months to clear, bleeding about $1,100 in interest.
Consolidate to a 10.9% p.a. personal loan over 24 months? Around $587 interest. Add a $195 establishment fee, total cost approximately $782. You've just saved a few hundred bucks—enough for that emergency buffer.
But remember: actual results depend on your specific rates, fees, and how aggressively you attack it.
Think of it as mission control for your debt destruction:
Highest interest (avalanche) saves money. Smallest balance (snowball) builds momentum. Pick whichever keeps you consistently paying extra—consistency beats optimisation.
If the comparison rate's genuinely lower, fees are reasonable, you won't extend the term unnecessarily, and you'll actually close those old cards? Then yes, it can accelerate your payoff.
The application adds a hard inquiry—minor temporary ding. But clearing balances and reducing utilisation? That's long-term credit score gold.
Contact your lender's hardship team immediately or call the National Debt Helpline on 1800 007 007. Free financial counsellors will help you negotiate and plan. Don't wait.
Minimum viable number. Most Aussies do fine with one low-rate/low-fee card for emergencies. Cancel the rest post-payoff to eliminate temptation and fees.
Your score might wiggle when limits and account age change. But eliminating debt risk and avoiding fees? Usually worth the temporary blip. If score's crucial, reduce limits first, then gradually close cards.
BNPL can still spiral into over-commitment and late fees. Treat it like any other debt—list it, pay it down, and pause new BNPL while in payoff mode.
Important: This is general information only—not personal financial advice. Consider your circumstances or seek independent advice before taking action. Always check costs, fees and terms for any financial product.
This information is general in nature and does not take into account your objectives, financial situation or needs. It is not personal financial advice. Consider whether it is appropriate for your circumstances and seek independent advice before making financial decisions.
‍
ABN: 88 633 007 860 WeMoney Pty Ltd
All rights reserved.
Built with ❤️ in Australia
Australian Credit Licence (ACL): 526330
WeMoney acknowledges and pays respect to the past, present, and emerging Traditional Custodians of the land in which we live and work.
.png)
