‘Play With the Figures’ Featured Card: ANZ First Visa

It can be difficult to tell exactly how a particular credit card will benefit you, when everybody’s financial situation is so different. Today we launch a series of posts looking at exactly what will happen to your credit card debt and your general budget with a specific card. Our first is the ANZ First Visa credit card – keep reading to find out what happens when we ‘play with the figures’.

Vital Stats on the ANZ Credit Card

Here are your basic numbers on the First Visa ANZ credit card:

• Purchase interest rate: 18.99%
• Annual fee: $30
• 44 days interest free on purchases

Your extra benefits include 7.99% on balance transfer for the first 6 months, and it becomes a no annual fee credit card for the first year.

What Happens If…

The minimum monthly repayment may change from time to time, but we’re assuming that it is 2.5% or so. After the first year when the annual fee and interest go back to normal, with a balance of $3000 on the ANZ First Visa credit card, you can expect:

• If you pay $75.75 per month (calculated minimum)
• It will take 37 years and 7 months to pay off the $3000 balance
• And you’ll end up paying $6,414 in interest

However:

• If you pay $100 per month
• It will take 3 years and 8 months to pay off the $3000 balance
• You’ll end up paying $1,161 in interest

And, even better:

• If you pay $120 per month
• It will take 2 years and 11 months to pay off a $3000 balance
• You’ll end up paying $886 in interest.

Surprisingly, if you chose a ‘lifetime’ balance transfer offer similar to the ANZ’s introductory balance transfer rate, the figures don’t show too much difference. At 7.99% for the life of the balance:

• If you pay $120 per month
• It will take 2 years and 6 months to pay off the balance
• You’ll end up paying $303 in interest.

If you go for an initial no annual fee credit card like the ANZ First Visa … make sure you pay down your balance as quickly as possible, and take advantage of those interest-free days!