About eight years ago Whitney Steel took out a balance transfer card thinking it would help her get on top of her mounting debt, but she was so wrong.
The Victorian based millennial is just like many women who are struggling financially and often turn to payday loans, personal loans, credit cards and even trying to access their super early to get on top of their situation.
But sometimes these decisions can cause more stress and be full of extra fees and charges.
In Whitney’s case, she had taken out the balance transfer card in her early twenties to help consolidate some small debts she had accumulated into one repayment but didn’t cut up the credit cards she had been using and accumulated more debt.
Whitney also didn’t realise that any new payments she made with the balance transfer card would be charged interest and used the balance transfer card for other payments.
It took Whitney four years to pay off the card, which had an initial interest-free period of 18 months as although she could make the minimum repayments, she had trouble reducing the balance.
According to new research by SocietyOne many Australian women are risking a lifetime of revolving debt by misusing their balance transfer card and not understanding all the costs involved.
The study found that women are about 20 per cent more likely than men to not be able to pay off the balance of their transfer within the interest free period.
Other findings show that 58 per cent of women who have taken out a balance transfer card did so to save money on interest. while 52 per cent did so to pay off debt faster and 41 per cent said they did it to make repayments easier to manage.
Women were also found to be less likely than men to be aware of transfer fees with 32 per cent of women saying they didn’t know what they were compared to 35 per cent of men.
When it came to annual fees, 49 per cent of women were unaware of the cost versus 35 per cent of men, while 41 per cent of women knew about the level of interest on new spending versus 45 per cent of men.
Women were also found to be 27 per cent more likely to have used their balance transfer card for new purchases compared to 17 per cent of men.
But in brighter news, only 3 per cent had taken out another credit card to solve their debt problems versus 20 per cent of men.