Retired credit card options - approval rate/banks

[willclan]

Was the application fulfilled with bonus/promo points attached? If so, that approach could be a possible workaround for CC churning in retirement.

Yes I received bonus points as I had not had a Westpac card previously. I only received a $6k limit but that doesn't worry me as it is easy to transfer 5 or 10k into the account if I have a big spend coming up.

 

[DC3]

I wrote househusband

 

[Cynicor]

Now I’m many many years off retirement so let me know if this is wrong, but those self funded of you would still be doing tax returns that show acceptable income levels, right?

Could you not then use the “self employed” option on applications? Is not technically correct but as someone self employed I know many/most bank Cc apps don’t ask for your bas or abn, they just want the NOA

 

[Brissy1]

I don't get why banks here think salaries are so much more reliable income than pensions. How many companies have folded in the last few years leaving 1000's of people out of work and probably with payments due to them and noncollectable? Jobs are getting shifted to overseas call centres leaving more Aussies unemployed. It seems everytime I refresh the news another construction company is out of business.

Pensions are 100% guaranteed and come with lots of extras like discounts on rates, utilities, transport, medical and such. Not to mention they are tax free. Why wouldn't the banks want to give credit cards to people who have been reliable their whole life, paid bills on time and manage finances responsibility? Just because you have a high income doesn't mean you know how to manage it responsibly.

It isn't like Australia in the USA (thank God) and banks do go on your Fico score and past history to determine if you are a potentially reliable customer. But here I can't even get one of those Citi Ready Credit loans, never mind a new credit card.

Did you actually apply for the citi ready credit (and 70000 velocity points )?
Or just presume you'd be rejected?
I (retired) got auto approval (have the Citi FFL cr card).
Go for it .

 

[burmans]

Now I’m many many years off retirement so let me know if this is wrong, but those self funded of you would still be doing tax returns that show acceptable income levels, right?

Could you not then use the “self employed” option on applications? Is not technically correct but as someone self employed I know many/most bank Cc apps don’t ask for your bas or abn, they just want the NOA

Depends on your income, I get a very good (self funded) pension income but it's not taxed.

 

[Cynicor]

Ah, pity (in a way)

 

[Brissy1]

Ah, pity (in a way)

As reported in The Australian on the weekend, self funded retiree Dick Smith's "taxable" income was $0, so he gave $1M to the ato as he said that it wasn't morally right otherwise. Pity we can't elect him as President.

 

[burmans]

Ah, pity (in a way)

Well fortunately on my last CC application (Westpac Black) they were smart enough to realise that this was still income by looking at a couple of bank statements and seeing it regularly hit my account.

 

[Tiki]

Did you actually apply for the citi ready credit (and 70000 velocity points )?
Or just presume you'd be rejected?
I (retired) got auto approval (have the Citi FFL cr card).
Go for it .

I applied a few months ago and was rejected, it was a higher SUB. I don't have any Citi cards, just a no-fee NAB card that came with the mortgage 20 years ago, Amex Edge and Westpac Rewards grandfathered as a no fee card from some previous card.

I think it's expired, the link on Oz Bargain is gone.

 

[Seat0B]

Now I’m many many years off retirement so let me know if this is wrong, but those self funded of you would still be doing tax returns that show acceptable income levels, right?

Could you not then use the “self employed” option on applications? Is not technically correct but as someone self employed I know many/most bank Cc apps don’t ask for your bas or abn, they just want the NOA

This might work, but for us they actually wanted to see payslips in addition to tax returns, which makes it a challenge if you haven't paid yourself a salary. I suppose one could bodgy something up, but I am a bit nervous about doing that as it could well be construed as fraud and they might decide to make an example out of someone - unlikely probably, but not a risk I would be willing to take.

And of course, once you have started a conversation (and ours was in person at the CBA), they know you are retired and it can be hard to backtrack from there. Probably just have to wait until that person moves on, which isn't long these days based on our experience, and hope the keep totally cough records like all their predecessors have in our experience, so that there is nothing for the next person to know either way if you tell them you are self employed.

In the end, we just decided to let it go - both of us have several credit cards with high limits, and I have a no limit Amex charge card, so we don;t really need new cards, just wanted to churn for points like most people on AFF do.

But the lesson from my friend to sort it before retirement was the main reason we have a lot of cards with high limits - we acted on her advice just before retiring and I am so, so glad we did.

 

[pyffii]

We're trying to get my wife a new credit card with her as the primary holder as a precaution should I "drop off the perch" before her and she's left without a credit card all be it temporarily ( until a new application is successfully made )....Denied denied seems to be the current responses even though substantial assets and income BUT the banks require, as stated previously, to see cash actually hitting an account....Accountants letter of proof of income is not necessarily accepted but AMEX have suggested we could try that avenue so lets see what happens....It wasnt meant to be this difficult !!!

 

[Flyfrequently]

@pyffii we sent through a letter from our Financial Planner outlining proof of income ie monthly drawdown and Super account balances (along with tax returns.)

Westpac were happy with that, though all they had to do was look at 4th of every month for the past 4+ years to see the $$ hitting our Westpac account!

You are correct- it shouldn't be this difficult!

 

[DC3]

… denied seems to be the current responses even though substantial assets …

I’m not sure that the banks put much (if any) weighting on assets

 

[pyffii]

zero weighting on assets and an unblemished credit history for over 45 years....its all about income hitting the bank account

 

[CaptJCool]

I’m not sure that the banks put much (if any) weighting on assets

zero weighting on assets and an unblemished credit history for over 45 years....its all about income hitting the bank account

seems to be none

Easiest credit cards to get approved for in Australia | Finder

Credit cards with low limits and easy eligibility requirements. Go directly to the application in one click and get a response in 60 seconds.

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apparently, Credit providers must assess your ability to repay potential debt within a 3-year period. As your income affects how much you can repay, it will have an impact on your approved credit limit.

 

[willclan]

seems to be none

Easiest credit cards to get approved for in Australia | Finder

Credit cards with low limits and easy eligibility requirements. Go directly to the application in one click and get a response in 60 seconds.

www.finder.com.au

apparently, Credit providers must assess your ability to repay potential debt within a 3-year period. As your income affects how much you can repay, it will have an impact on your approved credit limit.

It is certainly easier to get a cc before retirement, so a wise move. Assets seem to be totally ignored, it's all about income to your account
The issue of ability to repay within 3 years is the Government requirement that is apparently causing problems with the banks having issues with giving a cc to a retiree, as though we are going to drop off the perch! Definitely age discrimination which somehow should be taken up with Government.

 

[levelnine]

While I'm not in this situation, I don't see much point in getting a credit card prior to retirement for points collection purposes (I can see why you'd get it for other benefits — perks such as travel insurance & cash flow management).

Say you get a card that earns 1pt per dollar. Even if you put a huge amount (for a retired person) of spend on it (eg $100K pa), you're getting a measly 100K points. On Qantas, that will barely get you one way to the US in J and not even all the way to Europe. And you're probably paying up for those points in the form of a hefty annual fee. Sure, some points earning is better than a poke in the eye, but it barely moves the needle.

Outside of churning, points earning through credit cards is a bit of a losing exercise imo.

 

[Peregrine]

Taking the point about the value of points - value of points is in upgrades. As suggested, rewards type cards can also have additional benefits that may be valuable - eg travel insurance that does not rise in price with age than if bought as a stand alone policy.

The requirement for credit card borrowers to be able to pay balance back in 3 years is set out in ASIC's REGULATORY GUIDE 209.

In relation to assets it says that "Although the general position is that consumers should be able to meet the financial obligations from income rather than equity in an asset, assets are an important part of the consumer’s financial situation.."

From the lenders perspective it also refers to the risk for lenders of taking account of assets - the risk of asset stripping where borrowers sell down assets to pay for credit debits. Clearly a complicated factual assessment for lenders and while I'm a retiree myself, can understand why for simplicity lenders just look at income.

 

[willclan]

Everyone to their own, but having a points earning cc for my normal spend has allowed us to travel overseas multiple times in Business Class comfort, which has saved us a lot of money if tickets were purchased.

 

[SYD]

While I'm not in this situation, I don't see much point in getting a credit card prior to retirement for points collection purposes (I can see why you'd get it for other benefits — perks such as travel insurance & cash flow management).

Say you get a card that earns 1pt per dollar. Even if you put a huge amount (for a retired person) of spend on it (eg $100K pa), you're getting a measly 100K points. On Qantas, that will barely get you one way to the US in J and not even all the way to Europe. And you're probably paying up for those points in the form of a hefty annual fee. Sure, some points earning is better than a poke in the eye, but it barely moves the needle.

Outside of churning, points earning through credit cards is a bit of a losing exercise imo.

I actually earn a shed load of points annually on regular spend. Fortunately I have two good cards already.

But points aside, one important reason to have a CC for frequent traveller is holding deposits - Hotels, rental cars etc. Using a debit card is cash out of your bank and a random number of days before it lands back - so I’ve heard.