The latest Reserve Bank of Australia data shows the nation's credit card debt has fallen to its lowest level since 2003. With 'buy now, pay later' options such as Afterpay growing in popularity, it doesn't come as much of a surprise. But the credit card industry is still worth billions of dollars. It's worth doing your research if you're thinking about applying for, and/or using one.

With Christmas around the corner, it's important to be aware of the pros and cons. Even if you're a long-time credit card owner, keep scrolling to learn more.

• They work in any currency (check conversion rates or whether there are any additional fees before making a purchase)
• They can be quickly cancelled in the event they are stolen, or suspected of being used fraudulently (making them safer than cash)
• They give you an emergency line of credit
• They provide flexibility and can help you manage cash flow effectively
• They can be used to build your credit rating
• They can be used without incurring any interest (as long as you make your repayments during the designated interest free period)
• They can offer reward points when you spend (depending on your provider).

• If you are unable to make your repayments, you could pay significant interest fees (some providers' interest rates could be as high as 22%)
• Missed repayments may damage your credit rating
• You could become a target for credit card fraud
• You may end up paying significant yearly fees (make sure you research the providers' total costs before making a decision to apply for one)
• Due to ease of access and use, you could quickly spend beyond your means
• Some businesses apply a 'credit card surcharge' when you pay with a credit card
• It can be very expensive if you need to withdraw cash using your credit card (interest rates apply).

Best-selling author (and regular National Seniors contributor), Noel Whittaker told CreditCard.com.au that today's culture of 'buy now, pay later' encouraged impulse buying and poor financial decision-making. 

He said the main difference between financial winners and losers is the discipline exercised by winners, compared with losers who "give in to temptation."

Takeaway: The only way to get to a position of financial freedom is through discipline. Credit cards can be an asset, but only if used diligently, with discipline and purpose. Spend within your means and pay your bills on time. It sounds simple, but there is a reason why so many Australians find themselves in significant credit card debt.

If you would like to learn more about credit cards, including how they work and whether they are a suitable option for you, check out the free courses and resources available at CreditCard EDU.

With up to 55 days interest free on purchases* and a competitive interest rate of 8.99% p.a.** on purchases, the National Seniors credit card could be the right option for you.

As an additional bonus, half of the $40 annual fee^ will go back to National Seniors' advocacy, research and education programs so we can help build a better future for all Australians.