Andrew Boyd
Vidhu Bajaj
David Boyd
Cards for pensioners, retirees and Centrelink income
Pensioners, retirees and Australians on Centrelink income can get a credit card, but it's harder than for someone on a full-time salary. Age can count against older applicants.
Part of the reason is that banks make less from retirees, who often clear their balance before the due date to avoid interest (the smart way to use a card). Approval is still possible with the right approach and some preparation.
Types of cards for pensioners
Low rate cards suit anyone carrying a balance month to month, and may offer an introductory low or 0% rate. Rewards cards earn points or cashback on everyday spending, as long as you pay in full each statement. No annual fee cards have fewer frills but cost nothing to keep open.
An expert view
David Boyd, co-founder of Credit Card Compare, on the main hurdle: "It is more challenging for a pensioner applying for a credit card when you rely on a pension as your primary source of income. The banks tend to consider pensioners to be similar to people on a low income or unemployed. Expect to have to present details of your assets and to have a low credit limit if approved."
Andrew Boyd, co-founder of Credit Card Compare, on preparing: "To increase the chances of being accepted, make sure to check your credit score before applying and address any issues it may raise. If you want to play it very safe, look for credit cards with no rewards attached, as this could mean the card has lower fees and rates."
What to consider
Compare interest rates if you might carry a balance, and weigh up annual, late payment and foreign exchange fees. Check the rewards only if you'll use them, make sure the credit limit fits your capacity to repay, and confirm the eligibility criteria, including any age and income conditions.
How to apply as a pensioner
Review your income, expenses and credit history to gauge your borrowing capacity. Compare cards suited to pensioners, gather your ID, proof of income and recent bank statements, then submit your application and wait for the decision.