Credit card options for retirees

[Seat0B]

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

I think this is very wise.

 

[Seat0B]

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

Which is intensely frustrating when one of the assets is a significant amount of cash held at that bank...which could easily be used to pay off a balance or to repay the whole shebang if you did unfortunately fall off the perch. Yes I am talking about my person experience here. And it was a LOT of cash. So frustrated with the whole thing.

 

[Tiki]

I really wish one of those Current Affair programs would call the banks out on this. If they are denying pensioners credit cards based on statistics and not individual performance it's not fair and responsible people should not be paying the price because irresponsible people are defaulting or not paying their bills.

 

[clifford]

I'd been knocked back by several banks, but was successful with Bankwest (the foreign fee free Mastercard), who gave me exactly what I asked for.

I just wonder if this was because I already held a couple of top level cards with CBA...

I do have a reasonable pension income plus a fair amount of cash at bank.

 

[levelnine]

I actually earn a shed load of points annually on regular spend.

You are definitely the exception rather than the rule.

Even if they spent 100% of their income on their credit card, the average retiree is earning enough income to get them one or two return trips Melbourne-Sydney on points with a $1/pt credit card. Not all that lucrative.

 

[SYD]

You are definitely the exception rather than the rule.

Even if they spent 100% of their income on their credit card, the average retiree is earning enough income to get them one or two return trips Melbourne-Sydney on points with a $1/pt credit card. Not all that lucrative.

Probably not. As discussed throughout this thread, there are plenty of us who aren’t “pensioners” but because we are no longer salaried employees, it’s difficult to get a new CC or increase the credit limit on the ones we have.

My example earlier for a credit limit increase for 28° MC isn’t even a points earning card but it’s invaluable for the regular international traveller.

 

[Gremlin]

I really wish one of those Current Affair programs would call the banks out on this. If they are denying pensioners credit cards based on statistics and not individual performance it's not fair and responsible people should not be paying the price because irresponsible people are defaulting or not paying their bills.

Really?!? When you apply for a credit card, you are asking someone to loan you money.

They are literally lending money with an unlimited term on an unsecured basis.

It’s THEIR money. They have EVERY right to determine who they lend to and on what terms.

 

[pyffii]

Went through the 3rd degree tonight with the Citi rep who was hopeless and kept asking for documents that had previously been uploaded and then had the audacity to say that the accountants letter of confirmation that was supplied via email was not acceptable and had to be in letter form !!!!....I then told her to ring the accountant....Geez its not supposed to be difficult and we hold 20 years of expenses ( we're in our 70's ) in CASH

 

[mel-world]

I have a problem here.

Don't want to pay $96pa for the few overseas purchases I make and maybe two or three times a year travelling. But I'm retired and if I give up [the 28 Degrees] CC, how do I go overseas with only a debit card, especially renting a car or guaranteeing accommodation when they sometimes take out the payment a day or two before arrival with little or no notice?

I've had no luck applying several times for a no fee CC from several institutions - just as a back up. Even if you have sufficient financial means, I can understand why a bank may not want you as a customer if you repay in full every month but, a CC is really a necessity, especially when it sometimes takes a week for a hold to be released after you return a car or check out of accommodation.

How do other members get by without any CCs?

 

[ellen10]

@mel-world , I am in a similar situation as you. Retired and no chance to get another cc card. I used this card extensively on our last 6 week trip overseas, for car hire accommodation, meals, drinks etc and saved lots on foreign currency fees. I am not going to cancel the card. Less than $2 per week is good value in my situation.

@RAM your analysis is excellent and very informative and I agree with what you said. For a retiree this card is worth keeping in my opinion.

 

[Lat34]

I'm in a similar situation - have held the Latitude/ 28 degrees card for a very long time but now retired. It's beyond frustrating that NO financial institution seems to understand that there are a fairly significant number of retirees who DO have sufficient income to manage $20k or $30k CC without even blinking. Just as there are a significant number of retirees who don't want or need a credit facililty.

Surely someone out there in banking land can seize the day and come up with a simple, retiree-centric credit card application process where maybe standard super fund / SMSF reports can be submitted to show mandatory drawdowns paid for say the previous three years. Plus maybe some info from your accountant. The current process is all about working people earning a regular income. Retirees also have a regular income, with a regulated drawdown amount that is often paid quarterly or half-yearly rather than weekly/ fortnightly. But you already know that.

It's insane that we are basically stuck with whatever credit cards we have at retirement with little or no opportunity to shop around for a better deal when new products become available. Or existing products "evolve"

Thank you for listening.

/rant over

 

[BJReplay]

That's great but... it's actually being approved for BW (or any other) card as a retiree is the main hurdle for many.

That may be true or it may not.

Yes, every retiree has different circumstances, but Mrs BJReplay with no separate income (just funds coming into a joint bank account - that could be mine, could be hers), no superannuation income, got a BW Platinum card by applying.

My main point is that it can't hurt to apply - especially if you can say to the person assessing your application (and it will be a person) that you're about to close your Lattitude 28° card if approved.

Worst case scenario is that your credit rating takes a hit because there's a record on a credit file.

If you apply to a big four bank, you'll probably be knocked back.

But if you apply to Bendigo or Bank West, you may be - as we were - pleasantly surprised.

And now, what was an "emergency" credit card - it was set up so that Mrs BJ Replay had a card in her name so that if I got hit by a bus, she wasn't without a credit card where she was the primary card holder - is now our primary spare fee free international transaction free credit card (CBA is our primary card, still, as a points earning card, but this is our backup if we have to cancel the CBA card because it is defrauded and we're travelling).

 

[luckypierre]

I'm in a similar situation - have held the Latitude/ 28 degrees card for a very long time but now retired. It's beyond frustrating that NO financial institution seems to understand that there are a fairly significant number of retirees who DO have sufficient income to manage $20k or $30k CC without even blinking. Just as there are a significant number of retirees who don't want or need a credit facililty.

Surely someone out there in banking land can seize the day and come up with a simple, retiree-centric credit card application process where maybe standard super fund / SMSF reports can be submitted to show mandatory drawdowns paid for say the previous three years. Plus maybe some info from your accountant. The current process is all about working people earning a regular income. Retirees also have a regular income, with a regulated drawdown amount that is often paid quarterly or half-yearly rather than weekly/ fortnightly. But you already know that.

It's insane that we are basically stuck with whatever credit cards we have at retirement with little or no opportunity to shop around for a better deal when new products become available. Or existing products "evolve"

Thank you for listening.

/rant over

Agree 100% with your rant
Since AFF/Point Hacks regularly “promote “
CCS, it would be great if AFF could advocate on behalf of responsible, financially secure and retired members to obtain a better access to credit cards offers

 

[oobi doobi]

I'm in a similar situation - have held the Latitude/ 28 degrees card for a very long time but now retired. It's beyond frustrating that NO financial institution seems to understand that there are a fairly significant number of retirees who DO have sufficient income to manage $20k or $30k CC without even blinking. Just as there are a significant number of retirees who don't want or need a credit facililty.

Surely someone out there in banking land can seize the day and come up with a simple, retiree-centric credit card application process where maybe standard super fund / SMSF reports can be submitted to show mandatory drawdowns paid for say the previous three years. Plus maybe some info from your accountant. The current process is all about working people earning a regular income. Retirees also have a regular income, with a regulated drawdown amount that is often paid quarterly or half-yearly rather than weekly/ fortnightly. But you already know that.

It's insane that we are basically stuck with whatever credit cards we have at retirement with little or no opportunity to shop around for a better deal when new products become available. Or existing products "evolve"

Thank you for listening.

/rant over

Agree100%.

 

[oobi doobi]

Agree 100%. Same situation here. Have more disposable income now in retirement than we ever had in our working years.
Cheers

 

[Lat34]

Agree 100% with your rant
Since AFF/Point Hacks regularly “promote “ CCS, it would be great if AFF could advocate on behalf of responsible, financially secure and retired members to obtain a better access to credit cards offers

@AFF Editor any chance AFF might be able to do a bit of advocacy with CC providers on behalf of poor, struggling retiree frequent flyers desperate to spend as much of their kid's inheritance as they can without wasting money on foreign transaction fees??? Pretty please??

 

[kamchatsky]

@AFF Editor any chance AFF might be able to do a bit of advocacy with CC providers on behalf of poor, struggling retiree frequent flyers desperate to spend as much of their kid's inheritance as they can without wasting money on foreign transaction fees??? Pretty please??

Whilst I am nowhere near retirement age, maybe my strategy is to get as many low cost CCs just before retirement, and just leave them in the drawer until they are needed as the cards get “evolved”?

 

[SYD]

Whilst I am nowhere near retirement age, maybe my strategy is to get as many low cost CCs just before retirement, and just leave them in the drawer until they are needed as the cards get “evolved”?

Very sensible. It’s actually not an “age” thing as such. Anyone who retires young still has the same issue. They could be sitting millions in assets, but the Bot sees no salary, so no deal!

Manual intervention works some times.

Another thing to consider is the max credit limit you might want to consider. Getting a credit limit increase can be just as hard as a new card - and with inflation, $5k today will be insufficient in 5 yrs time.

 

[BJReplay]

They could be sitting <reasonable> assets, but the Bot sees no salary, so no deal!

That was me, immediately post retiring before the age that I could access superannuation.

Living off savings before drawing down on investments during the COVID crash (which was the plan) didn't do anything good for proving my ability to prove that I could afford a credit card.

Human assessed credit card providers were more accommodating.

my strategy is to get as many low cost CCs just before retirement

I wish I had. Oh, actually, I did. Lattitude 28°, for example

Low credit limits are a bit of an issue, but not much, as I can readily fund the cards, but big purchases are still problematic as you point out.

 

[Jacques Vert]

While I agree that it is far more difficult to successfully apply for credit cards once you retire, it is not impossible. I've been able to get a number of new cards since retirement and my retirement income is not that high. (I've also been rejected a number of times. far more often than approved.)

The trick is to find out what the income requirement is and only apply for cards where you can meet the requirements. I have a friend who did this recently by speaking to the local bank branch, then increased his pension payments to match the requirements. Once he was approved, he reduced his pension payments back to what they previously were.

It's about playing the game and being persistent.

Of course, make sure you get approved for the new card before you cancel the old one.

Good luck to all.