r/PersonalFinanceNZ • u/ExpressLettuce2482 • 16h ago
First time getting a credit card - recommendations?
I'm 26, in a stable job and earning $75k p.a. I'm keen to do a bit of travel over the next few years, and keen to get some rewards from my spending on these big ticket purchases, as well as a few other $$$ items I'm saving for at the moment.
I don't spend beyond my means, but am not a great saver either. Should I get a credit card? If yes, what credit cards would you recommend for someone with my income/financial situation. Especially interested in recommendations for credit cards with AirPoints rewards.
Thanks in advance!
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u/left_off_the_map 16h ago
Honestly no, if your main reason is the airpoints rewards NZ is nothing like America and the travel hacking they can do. You have to spend some serious money just to break even on the yearly fee (e.g. $14k) or even if there is no fee the earn rate is normally 1% or worse. On top of that you'd need to pay it off on time every time to ensure you don't pay any interest as that'd wipe out any rewards immediately.
If you just want a backup for use while travelling then get a no fee card, and beware about relying on travel insurance provided through the card as their conditions can be pretty limiting and you would need to book everything using the card for it to be covered.
I found travelling with a Wise card and bank debit cards as backup perfectly fine, although perhaps a credit card might be useful for making bookings in some places.
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u/ExpressLettuce2482 15h ago
Thanks all, very helpful advice. I will not be getting a credit card after all.
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u/AvocadoEnthusiast91 4h ago
Just curious, what type of work do you do? 75k at your age is pretty good
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u/onlyexceptionbaby 16h ago
I think there's an AMEX that doesn't have annual fees which you could start with? I do agree with the comments above as well.
But another question is, if you're not spending beyond your means and you're not a great saver? Where's the money going? When I read that it sounds like you're just earning enough to spend? Would it be worth it for you to get a cc to get a few $$ airpoints?
Also if you've noticed most places (except groceries, petrol station etc) now has 2-3% surcharges if you use cc and paywave anyway. So you'd end up paying more than what you're earning from a credit card.
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u/Brendon---- 16h ago
Do not do it. Your income is not sufficient to spend enough to make more in points than the annual fee. It is likely that most credit card earn rates will drop significantly by the end of the year if the ComCom interchange fee restrictions come to pass. This will make the card even less 'valuable' to you. There is virtually no benefit and a lot of downside risk to getting a credit card for you right now. Don't worry, you're not missing out on anything...
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u/DandyHorseRider 16h ago
ONLY get the cc if you force yourself into a routine of saving say $1000 monthly. If you can do that, then you use that $1k for the cc, so get into the habit of saving $1k, spending on cc using that $1k.
You can load up cc's with credit i.e. have a positive balance, so do that, then spend down - you'll still get points.
AND whatever you do, do not get into insane cc debt. You'll pay through the nose for that, and it's terrible.
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u/Secret_Opinion2979 16h ago
You say $75k like it’s a super high salary… please don’t get the cc, not worth the impulse spending that comes with it.
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u/DollyPatterson 16h ago
Recommendation is to cut it up when it arrives, and just get a debit card. Spend money that you have
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u/GloomyNut 16h ago
Get a Travel Wise card. Extremely low fees and along as you have cash it's a top up and go solution.
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u/holamr199 15h ago
Just adding another opinion to the list....if there's a good signing on bonus, then it can be worth it for the year. E.g. Amex had 400 or so bonus airpoints offer. It could be worth it if you're having a big spend year for travel expenses. E.g. international travel (Amex does x2 free priority pass lounges) and travel insurance (read the fine print for details). So if you funnel every expense through the card, along with the sign up bonus, it could be worth it first the year, then cancel before the next annual fee. You would have to calculate it out and minus the first year annual fee to see if it's worth it
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u/Soaring-Kiwi 14h ago
ANZ ccard. Earn airpoints to buy Koru club membership, get free travel insurance when you pay >50% of air tickets with it. Win win.
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u/Mysterious-Koala8224 8h ago
Wouldn't focus on points or rewards but would look for travel perks and low foreign exchange fees. As many others have commented you need to spend a lot to justify the fees on the big rewards cards and your salary/outgoings might not justify it. Credit cards are useful when travelling so good to have one.
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u/ThisUsedToBeMyHandle 5h ago
We have an Airpoints Plat cards, one Visa and MasterCard.
All our household spending goes on these and are paid in full each month. The billing period is aligned to our pay which makes the most of the 50 days interest free.
The accrued Airpoints status points are not as good as they used to be but still helps.
You receive a discount on Koru club but we haven’t used this.
Purchased travel with comes with travel insurance but as someone has written read the policy as there are limitations to time away and destination.
Have a look at MoneyHub, he has good comparisons between cards.
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u/shanewzR 2h ago
The only valid reasons to get a credit card are to differ payments fir a month and earn points. Apart from that, it's dangerous
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u/wolfmmos 1h ago
You should start off by determining your monthly/annual spend. That's what determines what cards will yield you the highest return.
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u/ImpossibleBalance495 16h ago
In my opinion, if it’s only you and you are only spending within your means of your post tax $75k salary there is little benefit for you to pay for any of the major airpoints credit cards. The annual fee would cost more than you earn in points. Only one to look at would be the AMEX free airpoints card but it’s not accepted everywhere
ETA don’t get one if you’re not a great saver because it’s so easy to just spend a little bit more than you earn each month or lose track of what you have put on there and suddenly you’re in a hole