When you first move to Australia, choosing a prepaid credit card is your best option for convenience and easy approval.
Relocating means that there are a few things you'll need to sort out before you're comfortably settled and can call Australia home.
One of the most important issues is your money situation.
You have to sort out your financial circumstances before you leave your home country and need to have enough money when you arrive.
Once in Australia you'll need to decide:
Opening up your bank account won't be too difficult provided you have an Australian address, a passport, and have started a job or have cash to deposit.
You can actually open it before you arrive.
There are a number of guides about the types of credit cards available , but those usually won't be approved before you have at least six months'
worth of credit history in Australia (regular employment with an income, and in addition a lease agreement or appliance rental contract, for example).
One important question to ask when you open an Australian bank account is whether a prepaid card will suit you (and how to get one).
If you're a new arrival to the country the chances are you'll have to wait at least six months, possibly longer, before you'll be eligible to apply for any type of Australian credit card that isn't a prepaid one.
For the type of credit card that will help you establish a good credit rating and allow you to earn high numbers of rewards points you have to show solid records of employment and income, an Australian correspondence address, and have up to 100 points of identification.
For those who wouldn't pass an Australian credit check because they haven't been in the country long enough to build up a solid credit history the prepaid credit card is a real advantage, for two main reasons.
You can still benefit from the convenience of a proper credit card without having to go through the strict credit checks applied to other types of cards when you go with the prepaid option.
One of the major providers of prepaid credit cards is Australia Post - so if you don't want to you don't even need to go to a bank. You can now purchase a prepaid card from a post office, and it requires no credit check, no interest is charged and you don't need to fill out a long application form.
Major banks also offer their own versions too, and when you want to keep your accounts with the same institution you should look into getting a prepaid card with your existing bank.
With the Australia Post card you simply register it online to keep track of purchases, to track it if it's lost or stolen, reload it automatically or receive alerts via SMS, so many of the usual credit card account features still exist.
When you use your debit card and you know you can press the 'credit' button on the eftpos machine there's always the temptation to buy something you might not necessarily need, and if the transaction isn't processed by the merchant for a few days you won't know when it will be taken from your account, so you can end up with an overdrawn fee if you're not careful.
If you've got a prepaid credit card with money already loaded, you can make sure you're not using your everyday account for spontaneous purchases and you'll be sure not to go over your limit when you can really only spend what's on the card. Having both options available is a good way to separate necessary and unnecessary spending, and stick to your fixed limit for unnecessary spending, definitely worth considering when managing your money in a new country.
This post was supplied by www.creditcard.com.au, a leading Australian credit card comparison service, which also offers tips and personal finance blog posts.
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