Cheapest Way of Paying HECS down before Indexation

Caerdyddblue on 17/05/2023 - 22:07
Last edited 17/05/2023 - 22:18

Hi everyone,

My partner is looking to pay off a large chunk of her HECS before the indexation and she had been thinking of signing up for an introductory 0% credit card and paying the limit off the HECS and make monthly repayments to pay off the card before the interest rate goes up. It seems like this isn't as straightforward as we had hoped, as the HECS attracts a large fee for using a credit card.

Is there any other savvy ways of paying a larger chunk off the HECS and then repaying over the coming months?

Thanks!

Debt is about $30k so paying down the whole amount isn't an option this year.*

Financial HECS-HELP

Comments

  • nubix on 17/05/2023 - 22:52

    Citibank allows you to withdraw 90% of credit limit as cash https://www1.citibank.com.au/personal-loans/features-benefit…

    I've never used it, nor do I know what the interest rate is. I've been tempted to do this several times due to the supposed interest-free for 1 year (again, this could be a promotional thing) but concluded it wasn't worth the time and effort every time.

    It's been posted here pretty often, one just 2 weeks ago in fact: https://www.ozbargain.com.au/search/node/citi%20quick%20cash…

  • JohnSy on 18/05/2023 - 00:40
    +1

    I am not certain if it would work for a HECS debt, but I use beemit to pay the ATO with no credit cards fees. If the payment is made as a BPAY payment, and the provider accepts credit cards as a payment method it should be fine. (Zippay is another option for providers who don't generally accept credit cards for BPAY payments). The limit for Beemit is $2000 per transaction, but you can make multiple transactions on the same day.

    Be careful of using credit card debit to pay off your HECS debt, you may have good intentions, but if you fall behind the credit card payments the interest may be larger than the indexation saving.

    • Caerdyddblue on 18/05/2023 - 21:16

      Is there a way of knowing if your specific credit card attracts any fees through beemit? I've got a st george amplify and Westpac altitude cards so hoping one of them are.

      Thanks for the concern, I agree but she won't be able to take on too much as they are both low limits.

      • JohnSy on 18/05/2023 - 21:23

        I have used beemit on both of those card types - there has never been any fees for using beemit with the tranactions I have made in the past (ATO included). When I used it to pay ATO tax, there was no credit card fees on those beemit transactions (whereas there usually is if you pay directly via credit card). You can always make a test payment for $100 or more and if there is a way log in to check your balance in a few days time to ensure the full amount was credited. Not much time before June 1st though. Keep in mind it may take a day or two for the transaction to appear at the other side.

  • wei13 on 18/05/2023 - 18:22
    +1

    Reminder that HECS indexation will happen on 1st of June, so it's a bit late now to sign up to credit cards. I'd say just pay off what you can afford.

    • park on 18/05/2023 - 22:59
      +1

      Yes I'm intending to send my bpay payment off early next week. Bpay payments can take up to three business days to go through, and there's enough riding on this particular payment for me that I'm giving it a couple of extra days for maximum odds of success

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