As the cost of living continues to rise, more and more people are using a credit card for their day-to-day expenses. But there is one big mistake to avoid.

“Avoid credit cards at all costs – you will be in debt for the rest of your life.”

It’s a warning seemingly given to all Australians as they embark on their financial journey, with worried loved ones pointing to horror stories of takeaway shopping sprees leading to lives of financial misery.

At the end of last financial year, it emerged that millions of people had ignored dire warnings about the credit card trap, with billions of dollars in credit spending owed by Australians.

However, as cost of living pressures continue to weigh on Australian household budgets – with forecasters warning things will only get worse – two experts have endorsed the idea of ​​using credit cards not only as a short-term solution, but as a way to pay on a day-to-day basis. expenses all the time – as long as you have the money to pay the expenses as soon as possible.

“It’s fine to put everything on it — even a coffee — it all adds up, especially if you’re making small purchases every day,” Daniel Sciberras, editor of Point Hacks Loyalty Guide, told .to.

Mr Sciberras noted that rewards programs, such as frequent flyer points and gift vouchers, made credit cards an attractive option at a time when many Australians had little disposable income.

“ANZ, Westpac, AMEX – most of the big banks and American Express have good sign-up and frequent flyer bonus point programs – obviously it all depends on what kind of card you get,” he said.

“You are going to get 70,000 to 130,000 frequent flyer points with some of them (120,000 points can be valued up to 24 one-way upgrades from economy class to business class on short domestic flights around Australia ) … and you can find those that have a restaurant rewards system where you get free wines at certain restaurants – there are a lot of different little quirks as many companies have a whole bunch of different features and addons back -plan.

“Loyalty points generally offer better value for money.”

Mortgage broker George Popadalis added that while there are plenty of benefits to be had from making your credit card your default, it’s imperative to make sure you can meet your monthly repayments.

“Make sure you know when you will have to start paying interest, because you will suffer if you do not repay your loans in full,” he warned.

“The biggest mistake is balance transfer (transferring money between banks) – a lot of people get caught up in it because you start earning interest from day one (instead of a month).

“You should also check first what the terms and conditions are – some customers were unaware that the merchant would charge a 2% fee for using a card at a certain terminal for example – this can skyrocket the cost of this way.”

Mr. Sciberras and Mr. Popadalis both pointed out that any vouchers or flyer points accumulated by the cards would always result in a loss to the user if interest rates come into play.

“The key is to repay that credit every month, otherwise the points benefits you earn will be offset by the costs,” Sciberras said.

Mr. Popadalis added that it is better to inform your bank as soon as possible if you are having trouble keeping up with repayments.

“If you find yourself in trouble, the first thing to do is call the bank and get the finance department and get help right away – don’t wait, anticipate this as far ahead as possible” , did he declare.

“It is better to address difficulties as soon as possible than to miss refunds and fall even further behind.”