Australians are being urged to stay on top of their credit card debt in 2024 after interest ticked up in December following a huge Christmas spending splurge in November.

Figures published by the Reserve Bank this week showed Australia’s total credit card debt attracting interest rose $21 million to $17.3 billion, following a record-high month for card spending in November.

Canstar’s finance expert Steven Mickenbecker said cards are supporting a higher proportion of Christmas spending this year, reflecting households struggling amid the cost-of-living crisis.

“We are back at work now, but Christmas 2023 won’t be forgotten for quite a while by the many Australians who will be paying it off over 2024.

“The combination of mounting living costs, higher mortgage repayments and rents, coupled with Christmas and summer holiday spending could prove too much for many.”

Here are some tips for getting in control of your credit card bill in early 2024.

Get out the scissors

The first step towards getting your credit card bill under control is stopping the debt from rising.

Canstar analysis shows the average balance with interest is $3598, which could take almost 25 years to pay off in minimum repayments at an average purchase rate of 17 per cent.

If that sounds like you, cut up your card and remove it from your phone too, because temptation can be your worst enemy.

Be careful though, even if you deactivate or lock your credit card through your bank’s mobile app recurring expenses can still be charged.

To stop those you’ll have to close the account or report the card as lost.

Dawn Thomas, a senior financial adviser at TWD, said Australians should avoid “putting their head in the sand” with a credit card bill, because in many cases that’s what the bank wants.

“Credit cards are set up in a way to make sure you fail,” Thomas said.

Beware balance transfers

One option to consider is a balance transfer, which will allow you to roll over outstanding credit card debt onto another deal with an interest-free period, Mickenbecker said.

“Anyone who has put Christmas and summer holiday spending on their credit card and is struggling to get on top of it could consider moving their debt to a card with a zero-interest balance transfer offer as a way to cut the interest bill,” Mickenbecker explained.

But you need to be careful because if you keep using the card it will get worse, Thomas warned.

“Balance transfers from one card to the next work if you’re not going to use that card any more,” Thomas said.

Circumspect about points

Any points you’ve built up using your credit card can be useful in helping you pay down debt because you could redeem vouchers for goods and services like groceries.

That means you’ll have more income left over to pay down any debt.

Discipline is key here though, according to Thomas, who says it’s easy to get distracted by points and rewards while your outstanding debt continues to grow.

“When people think about having a card with points it’s actually a minority of people who know how to effectively use it,” Thomas said.

Help is available

There is help available if your credit card or any debt is getting out of control.

Lenders are required to offer hardship services to borrowers and the National Debt Helpline can connect you with a financial counsellor for free to discuss a strategy tailored to your specific financial needs.

You can find them online here, or over the phone at 1800 007 007.