ASIC reports 10.8% of seniors have problem credit card debt

12 October 2018

ASIC’s review of credit cards reveals that more than 1 in 6 consumers are struggling

Recently, the Australian Securities & Investment Commission (ASIC) completed a report on credit card lending in Australia^. In the report findings, ASIC found that over 1.9m Australians (or 18.5% of consumers) were deemed to have ‘problematic credit card debt’.

The impact of this kind of debt can go beyond the obvious financial implications. It can include reduced consumption (i.e. diminished living standards, ‘tightening the belt’ to make ends meet) and stress from the pressure of having to maintain outstanding debts.

Many seniors rely on credit cards to get by

When looking deeper at the report, it highlighted 10.8% of seniors aged 65 and above were experiencing this problematic debt. It’s not difficult to see how this has come about.

In Australia, for 52% of pension recipients, their pension is their main source of income. With costs of living on the basics, such as food, utility bills and medical expenses, continuing to increase, relying on a credit card, personal loan, or another form of debt between pension payments can become an unfortunate reality.

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No one wants to spend their retirement worrying about debt and keeping up with repayments, but it is a sad fact that many on a limited income do.

Heartland is here to help

With an interest rate that is often lower than credit cards or personal loans, a Heartland Reverse Mortgage could allow you to access the equity in your home to pay off outstanding debt. What’s more, additional funds could be accessed for any worthwhile purpose such as additional income, living expenses, home improvements, or medical costs.

One of the benefits of a reverse mortgage is that regular loan payments are not required. The interest is calculated on the balance outstanding, and added monthly to your loan. Voluntary repayments can be made at any time, which reduces the balance and interest charged. At the end of the term of your loan, when you move permanently from your home, the total interest charged, together with the amounts drawn (and any fees applicable), will be payable.

At Heartland, over 40% of our customers use a reverse mortgage to repay debt, easing the squeeze on their cost of living.

If you would like to find out more about how a reverse mortgage could help you, please contact our specialist team at [email protected] or 1300 889 339, or request an information pack to find out more. We are here to help you.



^ASIC Report: Credit Card Lending in Australia

Information provided is accurate as at 11 October 2018 and may change from time to time.