No Credit Check :: Articles

Credit - Your Friend or Foe?

Credit - Your Friend or Foe?

Credit - Your Friend or Foe?
In this article, we investigate the difference between money and credit. When either will buy those wicked sunnies or cute earrings, the difference can start to become more than a little blurry.
Often when people use credit, they know they’re paying with money they don’t have, but they fail to appreciate the interest and just how long they might be nursing it …. months on end, maybe even years.

Interest

Say you buy those earrings and you choose only to pay the interest payable on your credit card, rather than paying the balance back by the due date… then you might end up buying those earrings a couple of times over, depending on how long you carry your balance without attending to it.
Boat Loan Specialists
Image for Boat Loan SpecialistsWe provide direct access to the best Boat Loan rates and options in Australia through a national panel of specialist marine finance brokers. Simply complete our quick & easy Boat Loan quote enquiry form to see if you qualify ... and to gain access to the best Boat Loan offers from our broker panel.
If you didn’t buy it on credit, you could have purchased something else with that interest… or you could have paid another debt off or maybe even kept some money aside so you were prepared for contingencies.
Can you see what we’re trying to get at here?
At the end of the day, it’s not your money, and you have to pay that money back… with interest.
Interest is the price of the money used over the given period of time, depending on the risk profile of the person receiving the credit, any security involved and the use of the credit.

Good credit

But credit isn’t always bad either. Even consumer credit.
Access to credit can help smooth out your entire well being and lifestyle.
If you didn’t have access to credit and the unexpected occurred or you budgeted poorly, you’d have to grind it out until the situation improved, surviving on rice and tomato sauce whilst not paying any bills or accommodation.
You wouldn’t be able to buy desired things when they came up or take a holiday for a few days even if you hadn’t quite saved up for it.
You probably couldn’t purchase a car or even dream of buying a house by writing out one big cheque for a few hundred grand.

Weighing up the costs

Essentially, in these cases, you weigh up the cost of paying the price of the item, plus the much larger associated finance cost.
You contemplate having the item now, against not having and perhaps never having it…and generally you go ahead with the transaction.

Wealth creation

Credit facilitates the creation of wealth.
We can borrow to enjoy the leverage of appreciating assets with greater returns than the interest paid.
These returns can create more options and equity, which can be secured by credit providers to borrow even more funds and acquire more assets.
In the meanwhile, our own funds, not credit, should be used for the purchase of depreciating consumer items or we risk never having the opportunity to build wealth.

Published: Tuesday, 3rd Aug 2021
Author: 46


Finance Articles

How to Use Credit Cards Wisely to Enhance Your Credit Score How to Use Credit Cards Wisely to Enhance Your Credit Score
Your credit score is more than just a number; it's a reflection of your financial health. Essentially, it’s a numerical expression that represents your creditworthiness. Lenders use this score to assess the level of risk involved in lending you money. - read more
Top 5 Mistakes That Damage Your Credit Score and How to Avoid Them Top 5 Mistakes That Damage Your Credit Score and How to Avoid Them
Maintaining a healthy credit score is crucial for anyone looking to secure their financial future. A good credit score can open doors to better loan rates, more favourable credit card terms, and even housing opportunities. It's something that impacts many major financial decisions you make in life. Without a solid score, you might end up paying more in interest and find it harder to get approval for the things you really need. - read more
Choosing the Right Loan for Your Personal Needs in Australia Choosing the Right Loan for Your Personal Needs in Australia
Choosing the right loan can be a pivotal decision in your personal financial journey. In Australia, where a diverse range of loan options is available, selecting the loan that aligns perfectly with your needs is more crucial than ever. A judicious choice can help you fulfill your dreams—be it buying a new home, investing in education, or consolidating debt—while ensuring that the repayments remain manageable and do not lead to financial strain. - read more
How Your Credit Score Affects Loan Approval and Interest Rates How Your Credit Score Affects Loan Approval and Interest Rates
Your credit score is a crucial part of your financial health. Essentially, it’s a numerical representation of your creditworthiness, calculated based on your credit history. In Australia, credit scores range from 0 to 1200, with a higher score indicating better creditworthiness. - read more
How to Improve Your Financial Health and Secure Loans Effortlessly How to Improve Your Financial Health and Secure Loans Effortlessly
Financial health refers to the state of one's personal financial situation. It encompasses a variety of factors, such as income stability, expenses control, savings, investments, and debt management. - read more
Understanding Your Credit File: How to Seek Loans without Negative Impacts Understanding Your Credit File: How to Seek Loans without Negative Impacts
Understanding financial health is paramount when venturing into the realm of loan acquisition. It's the backbone that supports not just your immediate monetary requirements but ensures longevity in your fiscal stability. At the heart of this understanding lies a critical aspect: the credit score. It's a numerical representation of your financial trustworthiness, influenced by past fiscal decisions and behaviors. - read more
Understanding Soft Inquiries: How to Check Loan Options Without Affecting Your Credit Score Understanding Soft Inquiries: How to Check Loan Options Without Affecting Your Credit Score
Soft inquiries are a type of credit check that does not impact your credit score. These checks occur when you or a company reviews your credit report as part of a background check, pre-approval process, or other non-lending purpose. - read more
Quick and Easy Tips to Boost Your Loan Approval Odds Without Affecting Credit Quick and Easy Tips to Boost Your Loan Approval Odds Without Affecting Credit
Loan approval can often be a crucial milestone in achieving your financial goals. Whether you're looking to buy a home, pay for education, or consolidate debt, securing a loan can provide the financial boost you need to move forward. - read more
Understanding Soft Credit Checks: Safeguard Your Score During Loan Comparison Understanding Soft Credit Checks: Safeguard Your Score During Loan Comparison
When embarking on the journey to secure financing, particularly for significant purchases such as a car, your credit score takes center stage in the eyes of lenders. A credit score is a numerical representation of your creditworthiness, derived from your financial history and behaviors. It wields substantial influence on your ability to acquire loans with favorable terms. - read more
Effective Debt Management Tips for Young Adults Effective Debt Management Tips for Young Adults
Managing debt effectively is crucial for young adults, especially as they start building their financial independence. Understanding how to manage debt properly can help you avoid financial pitfalls and set you up for a stable future. - read more
How to Improve Your Financial Health and Secure Loans Effortlessly How to Improve Your Financial Health and Secure Loans Effortlessly
Financial health refers to the state of one's personal financial situation. It encompasses a variety of factors, such as income stability, expenses control, savings, investments, and debt management. - read more
How to Use Credit Cards Wisely to Enhance Your Credit Score How to Use Credit Cards Wisely to Enhance Your Credit Score
Your credit score is more than just a number; it's a reflection of your financial health. Essentially, it’s a numerical expression that represents your creditworthiness. Lenders use this score to assess the level of risk involved in lending you money. - read more
Top 5 Mistakes That Damage Your Credit Score and How to Avoid Them Top 5 Mistakes That Damage Your Credit Score and How to Avoid Them
Maintaining a healthy credit score is crucial for anyone looking to secure their financial future. A good credit score can open doors to better loan rates, more favourable credit card terms, and even housing opportunities. It's something that impacts many major financial decisions you make in life. Without a solid score, you might end up paying more in interest and find it harder to get approval for the things you really need. - read more
Maximize Your Loan Options without a Credit Footprint: Strategies to Know Maximize Your Loan Options without a Credit Footprint: Strategies to Know
As we navigate the complexities of today's economy, the significance of credit can scarcely be overstated. Whether we're considering a home mortgage, a new car, or managing our personal finances, our credit health often dictates the terms and accessibility of financial support. A robust credit score can open doors to favorable loan terms and rates, while a poor score can narrow our options and cost us more in the long run. - read more
How Your Credit Score Affects Loan Approval and Interest Rates How Your Credit Score Affects Loan Approval and Interest Rates
Your credit score is a crucial part of your financial health. Essentially, it’s a numerical representation of your creditworthiness, calculated based on your credit history. In Australia, credit scores range from 0 to 1200, with a higher score indicating better creditworthiness. - read more
Understanding Your Credit File: How to Seek Loans without Negative Impacts Understanding Your Credit File: How to Seek Loans without Negative Impacts
Understanding financial health is paramount when venturing into the realm of loan acquisition. It's the backbone that supports not just your immediate monetary requirements but ensures longevity in your fiscal stability. At the heart of this understanding lies a critical aspect: the credit score. It's a numerical representation of your financial trustworthiness, influenced by past fiscal decisions and behaviors. - read more
Understanding No-Credit-Check Loans: A Lifeline for Managing Financial Stress Wisely Understanding No-Credit-Check Loans: A Lifeline for Managing Financial Stress Wisely
Financial stress can feel like an unstoppable force, a cycle of worry that impacts not only our peace of mind but also our fiscal health. It represents the anxiety and pressure associated with the inability to meet financial obligations, be it due to unforeseen expenses, unemployment, or a plethora of other reasons. - read more
How to Use Loan Comparison Tools Effectively - A Guide for the Credit-Conscious How to Use Loan Comparison Tools Effectively - A Guide for the Credit-Conscious
When it comes to securing a loan, the terms you agree to can have a lasting impact on your financial wellness. It's crucial to strike a balance between finding a loan that fits your needs and maintaining a healthy credit score. This delicate equilibrium is where loan comparison tools come into play, serving as navigational aids in the vast sea of credit options. - read more
Loan Hunting with Confidence: How to Check Options Without Credit Damage Loan Hunting with Confidence: How to Check Options Without Credit Damage
Embarking on the journey to secure a loan can feel like navigating a minefield with your credit score as the prize. It's no secret that your credit score is your financial fingerprint, impacting not just your loan prospects but also the terms you're offered. However, the act of loan hunting itself, if not done carefully, can take a toll on this crucial number. - read more
Choosing the Right Loan for Your Personal Needs in Australia Choosing the Right Loan for Your Personal Needs in Australia
Choosing the right loan can be a pivotal decision in your personal financial journey. In Australia, where a diverse range of loan options is available, selecting the loan that aligns perfectly with your needs is more crucial than ever. A judicious choice can help you fulfill your dreams—be it buying a new home, investing in education, or consolidating debt—while ensuring that the repayments remain manageable and do not lead to financial strain. - read more

Finance News

Increasing Number of Qualified Financial Advisers Opt Out of Practice Increasing Number of Qualified Financial Advisers Opt Out of Practice
11 Jul 2025: Paige Estritori

Recent analysis from WealthData indicates a growing trend among financial advisers in Australia, where a significant portion of those who have successfully passed the financial adviser exam are opting not to practice. As of now, 5,096 individuals, representing 33.31% of active advisers, have chosen not to proceed into practice after passing the exam—up from 28.36% a year prior. - read more
Melbourne's Housing Market: A Prime Opportunity For Buyers Melbourne's Housing Market: A Prime Opportunity For Buyers
11 Jul 2025: Paige Estritori

The Reserve Bank of Australia (RBA) recently surprised many by maintaining the interest rate at 3.85%, against expectations of a cut. This decision is seen as a measure to continue moderating inflation, but it simultaneously delays potential spikes in the housing market, providing a favorable window for prospective homebuyers. In particular, Melbourne's current market presents significant value, offering a promising opportunity for those looking to enter the property market. - read more
Improving EOFY Planning: The Call for ATO Portal Access for Advisers Improving EOFY Planning: The Call for ATO Portal Access for Advisers
09 Jul 2025: Paige Estritori

In a recent discussion, James O'Reilly, Director and Financial Planner at Northeast Wealth, underscored the benefits that could come from granting financial advisers access to the Australian Taxation Office (ATO) portal. Speaking on The ifa Show, O'Reilly proposed that this access would significantly simplify the services financial advisers provide to clients, particularly at tax time and the end of the financial year (EOFY). - read more
RBA Holds Rates Steady, Shocking Markets and Shifting Economic Expectations RBA Holds Rates Steady, Shocking Markets and Shifting Economic Expectations
09 Jul 2025: Paige Estritori

The Reserve Bank of Australia (RBA) has decided to keep the official cash rate steady at 3.85%, taking many by surprise after expectations of a 25-basis-point cut had built up in financial circles. This unexpected move comes amid recent data indicating easing inflation and weaker than anticipated economic growth, conflicting with prior predictions of a cut. - read more
RBA to Continue Interest Rate Cuts Amid High Unemployment RBA to Continue Interest Rate Cuts Amid High Unemployment
08 Jul 2025: Paige Estritori

The Reserve Bank of Australia (RBA) is anticipated to maintain its trajectory of incremental interest rate reductions, according to insights from leading financial analysts at ANZ. Recent data from the ANZ-Indeed Australian Job Ads series revealed a rise from 114.8 in May to 116.9 in June, suggesting a potential rebound in job advertisements after previous declines. Despite a stable unemployment rate and hours-based underutilisation rate since mid-2024, the Australian labour market remains strained. - read more
RBA Poised for Cash Rate Cut Amid Inflationary Trends RBA Poised for Cash Rate Cut Amid Inflationary Trends
07 Jul 2025: Paige Estritori

As the Reserve Bank of Australia (RBA) prepares for its forthcoming monetary policy announcement, economic analysts anticipate a further reduction in the official cash rate by 25 basis points. This prediction, supported by Finder’s RBA Cash Rate Survey, reveals that 88% of participating experts foresee a cut that would lower the interest rate to 3.6%, aligning the decision with the recent decline in both headline and core inflation to the central bank's target range of two to three percent. - read more
Uncovering the Impact of Unsolicited Solar Sales on Consumers Uncovering the Impact of Unsolicited Solar Sales on Consumers
04 Jul 2025: Paige Estritori

In a concerning revelation, Australian retiree Christine Hirchfield shares her ordeal with an unsolicited solar installation that turned into a financial nightmare. Despite her initial enthusiasm for cheaper energy bills and a greener home, the project remains incomplete more than a year later. Consumer groups are now advocating for a nationwide prohibition on deceptive sales practices that target vulnerable consumers like Ms Hirchfield. - read more
Australian Online Retail Sees Continued Growth in May Amidst Nationwide Spending Surge Australian Online Retail Sees Continued Growth in May Amidst Nationwide Spending Surge
03 Jul 2025: Paige Estritori

Australian online retail sales experienced a modest rise in May, as consumers continued to invest in fashion, games, and toys. According to the latest figures from the National Australia Bank, there was a 0.7% increase in online sales for the month, compared to a 1.1% growth in April. Over the past year, Australians have spent approximately $63 billion on online retail purchases. - read more
Pay Boosts and Policy Changes: A Closer Look at Financial Updates for Australian Workers Pay Boosts and Policy Changes: A Closer Look at Financial Updates for Australian Workers
03 Jul 2025: Paige Estritori

The starting days of the new financial year bring significant changes for Australian workers, particularly those on minimum wage. As of Tuesday, the minimum wage will rise by 3.5 per cent, increasing hourly earnings to $24.95, or $948 weekly. This adjustment also affects award wages and comes as a response to rising living costs, outpacing current inflation rates. - read more
US Dollar Faces Historic Decline Amid Trump’s Tariff Policies US Dollar Faces Historic Decline Amid Trump’s Tariff Policies
03 Jul 2025: Paige Estritori

The US dollar has experienced an unprecedented decline, marking its worst first-half performance since 1973. Concerns surrounding President Donald Trump's tariff policies have intensified, leading to a substantial drop in the value of the world's primary reserve currency. Specifically, the dollar weakened by 10.7% against a basket of major trading partners' currencies in the first six months of the year, reminiscent of Nixon's era when the dollar was untethered from gold. - read more

Need Help Finding a Loan?
Find out now if you qualify and compare rates, offers and options from multiple lenders - without a credit check!
Loan Amount:
Postcode:
All finance quotes are provided free and without obligation. We respect your privacy.

Knowledgebase
Portfolio:
A range of investments held by an individual or institution.


Quick Links: | Personal Loans | Car Loans | Bike Loans | Boat Loans | Truck Loans | Home Loans | Business Loans | Debt Consolidation