According to the latest data from the Reserve Bank of Australia, more than $19.7 billion of personal credit and charge card balances were accruing interest in the lead-up to Christmas last year.
During the same November period, there were over 783,000 cash advances taken on personal credit cards, which are generally calculated at a higher rate and begin accruing interest immediately.*
Spending typically peaks in December, with credit and debit card transactions reaching record levels, leading to increased debt.
While options like credit cards and buy now, pay later services can feel convenient at the time, they often come with high interest rates, fees or ongoing repayments.
With the average credit card interest sitting at an eyewatering 18.52%, regaining financial footing can be challenging.
If the festive season has you feeling financially stretched, it might be a good time to press pause.
Aside from making repayment plans, and resisting the urge to borrow for non-essential purchases – we’ve got tips to help you manage without resorting to credit debt.
Little known support for back-to-school costs
For families, the start of the year can bring additional financial pressures. Back to school costs such as uniforms, books and technology can quickly add up.
So, if you’re a parent facing several large bills at once, an advance payment might be an option worth considering.
If eligible, you can get some of your income support payment or Family Tax Benefit Part A early as a lump sum amount. You then pay that back by getting a bit less in your next 13 payments.
Unlike personal loans or credit cards, advance payments don’t attract interest or fees.
We know families are the biggest users of the advance payment option, with around 1 million advances paid to families recipients over the last 12-months.**
Many families take an advance on their Family Tax Benefit at back-to-school time to help pay for essential costs.
The amount you’re eligible for will depend on your circumstances. You can test your eligibility using your Centrelink online account through myGov or your Centrelink Express Plus mobile app.
Update your family income estimate
Another handy tip for families is to make sure your details are up to date for Child Care Subsidy and Family Tax Benefit.
As well as your income, you should update us if your family circumstances like your work, or study arrangements have changed.
Services Australia uses this information to calculate how much Child Care Subsidy or Family Tax Benefit to pay you.
Families need to keep us updated to avoid overpayments that might need to be paid back later.
The last thing we want is for you to get a debt because you’ve forgotten to let us know about changes to your income, or family circumstances.
You can update your details online using your Centrelink online account through myGov or your Centrelink Express Plus mobile app. There’s a handy guide on the Services Australia website.
Support to help you build your money skills
Where possible, planning ahead for larger or irregular expenses – like school costs, car repairs, or annual bills can help ease financial pressure.
Delaying non-essential purchases and setting aside small amounts over time can reduce the need to rely on credit during emergencies. However, we understand that planning ahead isn’t always possible.
Many people living paycheck-to-paycheck or relying on income support are focused on immediate needs. This reality requires empathy and understanding rather than judgment.
If you’re feeling unsure about your finances, we have information to help you budget, manage debt and your money on our website.
You can also speak to one of our Financial Information Service (FIS) officers for free.
While this service doesn’t provide personal financial advice, it helps people to improve their financial capability by looking at financial options in addition to the payments we offer.
You can call FIS on 132 300 and say ‘Financial Information Service’ when asked why you’re calling.
*Reserve Bank Australia Credit and Charge Cards – Original Series – Personal and Commercial Cards data released on 12 January 2026.
**Services Australia data October 2024 – September 2025 is for payments not individuals (one customer can have multiple payments).
Originally published by Yahoo Finance on 23 January 2026.