
Why Gen Z Aussies want this boomer staple gone: 'Financially dangerous'
Queensland woman Nat, 24, said she had made the switch to buy now, pay later (BNPL) services as they don't have high interest rates like credit cards.
Afterpay revealed earlier this year and that 84 per cent of Aussies deemed credit cards 'financially dangerous' with their use in decline since 2018.
There were about 12.1million credit cards as of March last year with a national debt accruing interest of $20.1 billion.
Nat said she had accrued thousands of dollars in debt after she got a credit card to pay for a laptop that she could use at university.
'It was really scary because it had massive amounts of fees, and I was so nervous about not paying it on time and ruining my chances of being able to buy a house,' she told news.com.au.
'I just found that it kept accruing interest and I was trying to pay it off, but it felt like a massive weight on my shoulders and it wasn't pleasant.
'I saw the amount of interest I had to pay and thought, "Actually, no".'
After that experience she decided to ditch the credit card and sign up to Afterpay.
Nat said she didn't understand why people had credit cards which come with annual fees and high interest charges if they're not paid off.
She recalled how an ex-boyfriend used a credit card to live beyond his means and could only cover the interest and couldn't get his balance down.
'I think it was about $7,000. It was terrifying,' she said.
Nat now prefers the lower risks involved with BNPL options.
BNPL services allow people to split their purchase into smaller, interest-free instalments, often paid bi-weekly.
Services may charge late fees, while credit cards offer more flexibility and potential rewards, but can also accrue high interest if balances aren't paid off on time.
Credit cards allow shoppers to pay for multiple transactions through a revolving line of credit with variable interest rates.
They are more flexible, which can lead to unpredictable statement balances and out-of-control debt.
'Our January 2025 survey found that nearly one in three Australians (32 per cent) have an Afterpay account, with Gen Z (45 per cent) and millennials (41 per cent) leading the charge,' Mozo's personal finance expert Rachel Wastell said.
Many Aussies online didn't agree with Gen Z however, and preferred to use a credit card, which offers benefits BNPL doesn't.
'I've had a credit card for 30 years with a 40-days interest-free period and I've never been charged interest,' one said.
'Credit cards are for emergencies and to be paid off on the last day of the month.'
'Get yourself a really decent credit card that gives you rewards and as long as you pay your card off each month, put everything you buy onto that credit card then use the cashback app and attach your credit card and get paid even more. Every year I get back around $2,000 in rewards, another said.
Graham Cooke, head of consumer research at Finder, said Afterpay was a 'great way to spread a purchase over time'.
'While there is no interest, there are late fees,' he said.

Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles


Daily Mail
5 hours ago
- Daily Mail
How Albanese's 1.2million housing policy failure and record immigration has created a new category of Aussies with nowhere to go
Australia's housing emergency is now so dire nurses are living in cars while thousands of mothers and their children are sleeping rough or crammed into crisis accommodation with no path out. Prime Minister Anthony Albanese promised to fix the housing crisis but Australia today is home to some of the most expensive real estate in the world, with near record low rentals available and the worst levels of homelessness in living memory. Recent data by Homelessness Australia reveals the number of people accessing their services each month has grown by 10 per cent since the Albanese government came into power in May 2022. The situation is even more dire for women and girls, with an increase of 14 per cent. But while women and children go without a roof over their heads, immigration is booming, which experts say is putting unprecedented strain on the local property market. Australian Bureau of Statistics figures show in the year to May, 1.1million permanent and long-term arrivals hit Australian shores, including international students and skilled workers. In cities soaking up the bulk of the arrivals like Sydney, Melbourne, Perth and increasingly Brisbane, the competition for rentals is fierce, sending rents and house prices soaring. Australian Population Research Institute president Bob Birrell blamed the housing crisis on record overseas migration, which meant working Australians were being pushed out of the market, unable to buy or rent. 'The Albanese government is completely irresponsible on this issue,' he said. Freelancer CEO Matt Barrie (pictured) said the Great Australian dream of home ownership is out of reach for many now and he places the blame on record migration 'They have neglected it ever since they got back into power in 2022, they've just let immigration rip. 'We've had enormous levels of migrants, which is just unprecedented, and irresponsible in the context of the housing crisis.' Dr Birrell said part of the problem is the skilled migration program recruits hardly any tradespeople, especially for the beleaguered building industry. 'Migration is not adding to the supply of those important trades at all,' he said. 'Although a lot of temporary migrants who are adrift in Melbourne and Sydney would probably like to take up an apprenticeship in these areas, they can't, because they're temporaries.' Freelancer CEO Matt Barrie said the Albanese government had created a system so perverse doctors were living in share houses and nurses were sleeping in their cars. 'The Great Australian Dream is now mathematically impossible for the average Australian,' he said. 'In Sydney it now takes 46 years just to save a house deposit. Think about that, for a child born in Sydney today, their retirement party will come before they've saved enough for a house deposit.' Mr Barrie said the housing crisis had been 'engineered' by the government which has flooded the country with the largest immigration wave in history. 'Why, in a cost of living crisis, would they allow nearly one million international student enrolments? 'Why, in a cost of living crisis, would they allow 2.46million people on temporary visas into a country of 27million when there's only 36,000 rental vacancies?' Refuge workers and frontline services are also sounding the alarm on the crisis which is leaving women and children behind. As politicians returned to Canberra for the first sitting week of the new term, Everybody's Home spokeswoman Maiy Azize said the Albanese government has a chance to deliver a lasting legacy on housing or risk being remembered for letting it slip away. It comes after the public release of a written warning to Treasurer Jim Chalmers that the Albanese government could not meet its commitment of supplying 1.2million homes by 2029. 'This is a national crisis that is now pricing out everyday people right across the country,' she said. 'The government can't ignore the increasing number of Australians who are sleeping on streets and couches, forgoing food and medicine to pay rent, and living in unsafe and makeshift housing.' Ms Azize said warnings the government is unlikely to meet its ambitious housing target are further proof that relying on the private market alone won't work. The organisation said social housing has declined to around 4 per cent of all homes, down from 4.7 per cent in 2013. 'To reach six per cent social housing Australia must build more than 36,000 additional social housing dwellings every year for the next decade,' she said. 'If we want one in ten homes to be social housing, we need to build an extra 54,000 social homes every year for 20 years. 'Whichever way you look at it, the scale dwarfs current government commitments and lays bare both the enormous demand and decades of chronic underinvestment.' During Question Time on Wednesday, Opposition leader Sussan Ley pushed Mr Albanese on whether he would abandon his failing policies to tackle the housing crisis. In his defence, Albanese said Labor had 'inherited a decade of neglect' and it would take time to catch up. One Nation Senator Pauline Hanson said Australian cities were full, housing is unaffordable, and services are stretched to breaking point. She said One Nation will cut permanent and temporary migration and restore the population to a level the country can support. 'This isn't extreme. It's common sense,' she said. 'Mass migration must stop. The system is broken. Let's fix it and give our people the chance to thrive.' For many it is too late. Shocking new data from Homelessness Australia reveals a record surge in families stuck in temporary refuges, with thousands of mothers and children sleeping rough or crammed into crisis accommodation. CEO Kate Colvin said one reason for the dramatic deterioration in families and women being pushed further into crisis is rising rents, with Labor's investment in social housing failing to keep pace with demand. Ms Colvin said many were one health tragedy away from losing a stable roof over their heads. 'It's heartbreaking when you meet people who have cancer and due to the number of hospital visits they attend they can no longer work. They lose their home and end up living in their car because you can't afford rent on income support payments,' she said. 'I've spoken to lots of young people who have been in and out of refuges for years, slept in parks or are couch-surfing with dubious people. 'There's always someone who'll offer a 16-year-old girl a bed but it comes with obligations.' Ms Colvin said homelessness is increasing for all, but women and girls are copping the brunt of this crisis. 'The Prime Minister talks about leaving no one behind but the harsh reality is that with 45 per cent of women and girls seeking homelessness support having experienced domestic and family violence, more women and girls are returning to violent homes.' Housing and Homelessness Minister Clare O'Neil said the government has invested more than $1.2billion in crisis and transitional housing. 'We're acutely aware of just how complex the challenge of homelessness is, which is why we continue to listen to people with first-hand knowledge right across the homelessness sector,' she told the ABC.


Telegraph
5 hours ago
- Telegraph
Britain risks following France into a terrifying debt crisis
Last week brought more bad news about the UK's public finances. June's figures for public sector borrowing came in at £20.7bn, well above the OBR's forecast and City expectations. What's more, £16.4bn of this was accounted for by debt interest payments. Yes, that's right: £16.4bn in one month. We are borrowing enormous sums to pay the interest on past borrowings of enormous sums. We are getting dangerously close to what economists call 'the debt trap'. This is when, under the pressure of rising debt interest payments, the debt ratio starts to explode. It goes without saying that it is good to avoid this, if you can. But can we? Be warned, you may need a ready supply of hot towels for this next bit. The key players in the debt drama are: the budget deficit, the debt ratio, the growth rate of the economy in money terms (which is equal to the real growth rate plus the rate of inflation) and the rate at which the Government can borrow. If the rate at which the Government borrows exceeds the growth of the economy (in nominal terms), then debt interest payments and the overall debt will rise as a share of GDP. In order to stop this process from leading to an ever-higher debt ratio, the Government must run a primary budget surplus (meaning a surplus on its budget without interest payments), requiring higher taxes and/or cuts in government spending. And the higher the initial debt ratio, the larger the surplus needs to be to stabilise the debt ratio. The debt dynamics are merciless. When emerging market countries become stuck in the debt trap, the result is usually default or much higher inflation, or both. Remarkably, given our pitifully low to non-existent real growth rate, the nominal growth of GDP (i.e. expressed in money terms), exceeds the average rate at which the Government borrows by a small margin. Phew! But this is somewhat misleading because the average cost of government debt is heavily influenced by past borrowing, some of which was at lower interest rates. When this debt matures, there is a risk that it will be refinanced at higher interest rates. So we are currently just avoiding the debt trap, but with the deficit so large, the debt ratio is still rising. In these circumstances, it is hardly surprising that the gloom is still gathering about the fiscal prospects that the Chancellor faces in the Budget this autumn. It hardly makes our position any better, but we are not alone. Amid all this domestic pessimism, few people have noticed what is happening to our close neighbour across the channel. France is facing a fiscal predicament every bit as serious as ours. For a start, France's ratio of government debt to GDP is higher than ours – 113pc of GDP compared with our 100pc. And its deficit is higher too – 5.8pc last year compared to our 5.1pc. And ours is set to be just under 4pc this year. In both countries, GDP growth has been weak, and prospects are clouded with uncertainty. The one area where France is better positioned is the cost of borrowing, and this really does show the weakness of the UK's position. Whereas 10-year bond yields here are 4.6pc, in France they stand at about 3.5pc, similar to other euro-zone members. In this regard, however, something extraordinary has been happening. French yields have been converging on Italy's. The gap between them is now only 0.18pc, the lowest for almost 20 years. It doesn't seem too fanciful to imagine that French yields will soon surpass Italy's. Admittedly, after a recent period of comparatively strong growth, it looks as though Italian economic growth is set to be slower than growth in France, returning to the long-established norm. That certainly does not make the job of stabilising the public finances any easier. And, at 135pc of GDP, Italy's debt ratio is a good deal higher than in France. But Italy possesses two striking advantages. First, its fiscal deficit is only 3.4pc of GDP, compared to France's 5.8pc. And excluding interest payments (the so-called primary budget), it is in a surplus of 0.5pc, compared to France's deficit of 3.7pc. The result is that to stabilise the debt ratio, Italy needs to tighten the budget deficit (through a mixture of higher taxes and expenditure cuts) by only 0.5pc of GDP. By contrast, to stabilise her debt ratio, France needs to tighten fiscal policy by over 3pc of GDP by 2027. Italy's second advantage is surprising to anyone who has followed Italian politics over the past 80 years. She seems to be more politically stable than France. Giorgia Meloni looks likely to be Italy's first post-war prime minister to complete their term. In France, there have been six prime ministers since 2020, and the current incumbent, Francois Bayrou, who heads a minority government, could be ousted any time soon. He recently announced a plan to tighten French fiscal policy by 1.5pc of GDP. By comparison, Rachel Reeves' Budget last October increased taxes by 1.2pc of GDP, but this was more than offset by increases in public expenditure. There is little chance of the proposed French tightening getting through parliament unscathed. The failure to pass a budget for next year, leading to the fall of the present government, could cause French bond yields to flare up. And then there is the presidential election in 2027. On voting intentions in the first round, Jordan Bardella, the likely candidate of Marine Le Pen's National Rally, is well ahead of the other candidates. Obviously, there's many a slip twixt the cup and the lip. But if the markets were to view a victory for the National Rally as likely, then they would surely send French bond yields much higher, thereby putting France in a dangerous fiscal position. We cannot gloat. There but for the grace of God go all of us.


The Guardian
8 hours ago
- The Guardian
On a roll: Who Gives a Crap toilet paper co-founder aims for ‘world domination'
It has been ubiquitous in middle class British bathrooms since a flush of growth during the Covid pandemic. Now Who Gives a Crap is aiming to wipe out the Andrex puppy, Cushelle's koala and Little Duck's little duck with a more ethical version of toilet roll. Its product, made from recycled paper or bamboo and wrapped in colourful paper, has risen rapidly to become the UK's third biggest non-supermarket brand. Now, the company – which claims to be the first ever online specialist loo roll maker – is aiming for 'world domination' with a rollout into Tesco supermarkets, and beyond. The Australian brand gives 50% of its profits to clean water and sanitation projects, and raising money for good causes is a key part of the company's purpose, according to its co-founder, Simon Griffiths. After experiments with a 'click to give' donations website and then a bar that sold beer and wine from developing countries, he settled on the idea of linking philanthropy to an everyday product that could reach every household. Griffiths says a trip to the loo inspired a 'quarter-second epiphany' on what that product could be, alongside the company's risque name and its mission to raise funds to provide access to clean water and sanitation in developing countries via partners including WaterAid. From the beginning, the company promised to donate half its profits to sanitation projects and as sales around the world have rapidly grown, it has raised close to £10m so far for projects such as eco-friendly waterless toilets in Kenya and school toilet blocks in Timor-Leste. Sales at its UK arm rose 17% to £45.5m in 2024 when operating profits more than doubled to £2.8m, according to the most recent figures available at Companies House. The company does not reveal international profits, but it donated £2.43m to sanitation projects last year, suggesting they have hit almost £5m. The brand is aiming to more than double donations to A$50m (£24m) by 2028 and within a decade collect 'hundreds of millions' of donations by adding new products and new countries. 'The reason why we exist is because there's still 2 billion people without access to adequate sanitation today, globally,' Griffiths says. 'If you're going to solve that problem that affects billions of people, you need to eventually be everywhere. That's not something we plan to do in the next 12 months. In 30 years' time, I think we will want to be in every supermarket in the UK.' The brand, which began online, is already in more than half of Australian supermarkets and went on to Tesco shelves earlier this month in the UK after launching in Whole Foods Market and Waitrose in 2023 . However, further expansion may be tough during a cost of living squeeze and the imposition of US tariffs on Chinese-made goods which is pushing up prices in what is now its biggest market – just ahead of the UK. Even in the UK, the ethical stance comes at a price for shoppers, with its 100% recycled rolls priced at 39p for 100 sheets for a six-pack at Tesco – on a par with Cushelle's six-pack but a considerable mark-up on the 16p for the supermarket's recycled own-brand and ahead of the 32p for 100 sheets for Andrex's 'family soft' nine-roll pack. He cheerfully admits that its success so far is down partly to the colourful paper wraps on its loo rolls, which people like to show off in their bathrooms, as much as its environmental and ethical considerations. Sign up to Business Today Get set for the working day – we'll point you to all the business news and analysis you need every morning after newsletter promotion From the outset the plan was to provide a stylish and ethical counterpoint to 'this sea of white and purple and different colours and pictures of puppies and pillows and feathers and things that were entirely unrelated to toilet paper' on supermarket shelves, Griffiths says. He has said the company might be only a fifth of the size it is today if it wasn't for the wrapping. Having started with 100% recycled loo roll made using waste – such as old letters and cardboard boxes – it now also sells a version made from bamboo. Other products include recycled tissues and, perhaps more controversially, recycled plastic bin bags and dog poo bags. The group is also expanding geographically including entering Canada this year – taking it to 37 countries in total. It is a long way from the toilet seat where Griffiths sat for 50 hours as part of a 2012 crowdfunding campaign that raised A$50,000 to back the first order and where it also signed up the brand's first 1,000 customers. Expansion today is underpinned by A$41.5m in 2021 from investors including Verlinvest, the Belgian investment company behind the oat milk Oatly and the fair trade chocolate brand Tony's Chocolonely. So far, a rising number of shoppers seem persuaded that the product is worth paying more for than bog-standard rivals and Griffiths insists it is more than a passing fad with every decision based on 'trying to do the right thing'. 'We've been around now for about 12 years in Australia. I don't think there's a risk of us kind of going out of fashion in the same way that you might see with clothing,' he says.