How to choose the right financial product for you
We get it. Borrowing money is a big deal and it’s important for your financial wellbeing that you choose the most suitable way to do it at whatever age, life-stage and income level you’re at.
There are a huge range of payment methods and financial products to choose from, such as credit cards, personal loans and buy now pay later (BNPL) options. So we’re going to take a look at all the options you need to consider before making a decision.
Overall, you should also be asking yourself what are your personal financial goals and objectives? And, how do you like to manage your money?
Here are a few more specific questions worth considering before making a decision.
How much money should I borrow?
Firstly, ask yourself how much money you need to borrow to achieve your objective, and secondly, how much can you afford to repay each month – our Personal Loan Repayment Calculator will give you a good indication. The amount you can afford to repay will depend on other outgoings and living expenses such as mortgage or rent, utility bills, and don’t forget to include TV subscriptions, gym memberships etc. Whatever you decide to borrow, you should always only borrow what you’re comfortable with.
Should I get a credit card or personal loan or BNPL?
This really depends on how you plan to pay back the money you borrow and what you’re using it for. If you require a lump sum upfront that covers the amount you need for, say, an unexpected life event, or, or a car, a personal loan may be what you’re after. If you plan to regularly use credit over an extended period and are comfortable making regular repayments, a credit card could be more suited to you.
If you’re looking to break down your purchases into smaller amounts, a buy now, pay later option, such as LatitudePay, might work better for your budget.
What type of credit card should I get?
Consider the reasons why you want credit in the first place. Is it to help pay for a big purchase that you need? Or to get more value from using a card by collecting points or redeeming rewards when you shop? Do you want it to help manage your budget? Each credit card is different and will have different annual fees, interest-rates, rewards programs and interest-free periods so you should compare all of your options. You can read more about weighing up the different credit card types in our blog article ‘Which credit card is best for you’, or visit the Australian Government’s Moneysmart page on ‘Choosing a credit card’, which covers similar topics.
Does it come with all the bells and whistles?
Credit cards and personal loans often come with many features to help you manage your money, or simply to enjoy the product. In fact, people often aren’t even aware of the full extent of their product’s features!
For example, our Latitude Gem Visa card offers interest-free deals and sometimes even discounts with partnered brands. It’s always worth taking a look at partnered brands and whether they’re places you want to shop.
How often do I need to review my finances?
To ensure the financial product you’re using still suits your needs, you should:
- Compare it other competitors at least once a year
- If you’ve had a big change in your life, such as a new job (including a change to your income), changed where you live, or any other significant life change, then you should reassess your financial products.
Some credit products aren’t always crystal clear for everyone, so if you have any questions your provider should be able to help. You can get in touch with us if you need to discuss anything about our products, or if a life event has changed your circumstances.
Depending on what you’re looking for, we have a range of loans, credit cards and our buy now pay later product, LatitudePay. If you’d like to read more about these, head to our website.
We understand that COVID-19 is having an impact on our community and that it could affect your financial wellbeing. That’s why we have put together a plan to help our customers.
To find out how we can help you, click here.